Nintendo in trouble

February 2nd, 2012

There was a time when Nintendo reigned king of all video game systems. Since then, both Sony and Microsoft have become giants themselves in the market with the Playstation and the Xbox, respectively.

Now, it seems like these competitors could be the least of Nintendo’s worries. As it falls into financial trouble, Nintendo is looking to invest in the future.

The company has been through hard times before. After dominating the market with the original Nintendo Entertainment System, the Super Nintendo faced huge competition in the Sega Genesis, and in the past years, the Nintendo 64 and Nintendo Gamecube both failed to outsell their competitors.

The Nintendo Wii however, has sold almost 98 million units worldwide, and was the most successful console of this past generation. Also, the Nintendo DS has annihilated Sony’s PSP in the portable market. So then why the financial trouble?

A little over a week ago, the company released its quarterly earnings, and it wasn’t pretty. The company reported profits of $631 million for the October to December period, representing a 61percent quarterly drop. Forecasts have been significantly lowered to due these reports as well.

Nintendo has predicted a net loss of $838 million (ending in March 2012). If this holds true, it would mark Nintendo’s first annual loss in a full 30 years.

This is the result of a number of things. Nintendo’s newest portable, the 3DS, was launched with an extremely bloated $250 price tag. Along with that, the system had a pretty pitiful handful of launch titles. Its only two first-party releases were re-releases of classic Nintendo 64 games.

Sluggish sales forced the company to admit defeat and implement a premature price drop. After the system’s price was changed to $170, sales for the 3DS skyrocketed. Unfortunately, analysts have reported that they are selling at a loss.

Another reason for Nintendo’s recent struggles is its inability to support its current console, the Wii. Sales for the Wii have dropped, perhaps because there aren’t many more potential buyers, or maybe because a high quality game hasn’t come out for the system in ages.

Besides last year’s phenomenal “The Legend of Zelda: Skyward Sword,” the new releases for the system have been mostly boring collections of mini games and unsuccessful ports of games from other systems. Added to this, Nintendo has failed to import successful Wii games from Japan that have an audience in the United States.

Lucky for all the rabid Nintendo fanboys out there, the company isn’t worried. According to them, the 3DS will start garnering profit soon enough. New big name releases like “Super Mario 3D World,” “Resident Evil: Revelations” and the upcoming “Kid Icarus: Uprising” are finally drawing large amounts of people to buy the system.

Nintendo’s real secret weapon is that its new system, the Wii U, is going to be a revelution in gaming. The system, which is slated for a late 2012 release, is apparently three times as powerful as the Xbox 360, and boasts an interesting new controller.

Just like the Wii’s innovative Wiimote controller, the Wii U comes with a tablet controller, not unlike an iPad, which also is equipped with the standard controller buttons. The graphics on the tablet screen are just as powerful as they will be on your TV, and if you want, the games can be simply played on the tablet. Have to go somewhere but just can’t bear to tear yourself away from your brand new game? Simply change the setting so your game is on the tablet and you instantly have a portable gaming device.

In addition to that, the company has stated that they are entirely committed to bringing in third-party developers to make solid games, which was something the Wii was severely lacking. So far, feedback has been terrific from companies such as Capcom, Ubisoft and Electronic Arts.

Nintendo has also promised an all new online gaming service, The Nintendo Network. The company has infamously been stuck in the stone age when it comes to online play, and this is a huge step forward for them.

The Wii U’s goal is to win back the “hardcore gamer” audience that was turned off by the Wii’s casual attitude, while still maintaining that casual audience.

The future is uncertain for Nintendo. After being unveiled last year with a few awesome technology demos, the Wii U is said to be officially revealed in its final form at this year’s E3 convention. Nintendo is seriously hoping that after this year’s presentation, Wii would like to play.