Competitive Strategy in Game Consoles Jay Conrod, Klimka Szwaykowska; Mar 7, 2007 The interactive entertainment industry has grown remarkably quickly in recent years. Since 2001, the market has been dominated by three major players: Sony, Microsoft, and Nintendo. Of these, Nintendo had the smallest market share, even though the company had historically dominated the market. In 2004, faced with strong competition from larger and wealthier rivals, Nintendo had to come up with an innovative strategy to maintain profitability.
At that time, the optimal strategy was differentiation into a neglected segment of the market: casual gamers who wanted a simpler, more intuitive gaming experience. Nintendo’s status in 2004 Unlike its competitors, both of which are powerful players in consumer electronics and business software, Nintendo is primarily a video game company. Nintendo has three main products: consoles, handhelds, and software (games). Typically, only one console product is sold at a time; production of one generation ceases shortly after the next generation is released.
Nintendo’s console in 2004 was the GameCube, which had been on the market for three years. The competitors’ products (Sony’s PlayStation 2 (PS2) and Microsoft’s Xbox) were approximately the same age, but had several advantages over the GameCube. Though they cost a little more ($150 for the Xbox and $130 for the PS2, compared to $100 for the GameCube), they had more advanced networking and media-playback features. By March 31, 2004, only 14. 6 million GameCubes had been sold worldwide (Nintendo 2004 Annual Report). Nintendo’s position was stronger in the handheld gaming market.
The handheld Game Boy Advance (GBA) was introduced at roughly the same time as the GameCube, and sold 51. 4 million units by March 2004. Nintendo develops software for all of its gaming systems. Although software is expensive to develop, it can be sold at a high margin. Nintendo has a wide variety of recognizable franchises such as Mario and Pokemon that keep sales strong. However, most of the software developed by Nintendo was targeted at a younger audience and does not appeal to older gamers. Porter Forces in the game console market Customers
The customers in this market are almost all individuals or families who purchase consoles from Nintendo through retailers. Customers tend to buy only one console at a time. Since console manufacturers suggest retail prices over entire countries or regions, individual customers have no bargaining power. Software purchased for one console cannot be played on other consoles so switching costs are high; if an individual wants to play a particular game, he or she is usually locked into the console that plays it. By 2004, there was a tendency for console games to be increasingly complicated.
Becoming involved in a game required a significant time investment to learn how to play. Game companies aimed mainly at servicing the “hard-core” demographic which enjoyed this kind of game. Relatively few games were produced for the larger demographic of “casual gamers”. Suppliers Suppliers are companies which make hardware and games for the consoles. Nintendo designs some of the hardware components for its consoles, but manufacturing and assembly are often outsourced, and many components are purchased “off the shelf” from large companies.
This keeps costs higher than competitors like Sony and creates a threat of forward integration by parts suppliers, who could potentially manufacture their own consoles. Switching costs are also high, as Nintendo software is made to be compatible with technologies supplied by the outside companies. The situation is different for software. Nintendo does much of the game development for its consoles, though most of its games are made for a fairly young audience. It also licenses a software development kit (SDK) to outside game developers. In a manner, these firms are Nintendo’s customers. Firms hich have made successful games in the past will probably have some bargaining power in this transaction, since Nintendo is interested in keeping their services for future game development (as will be discussed below, games are an essential complement for game consoles). Overall, Nintendo’s SDK tends to be priced lower and have better support than similar packages offered by competitors. Threat of new entrants The console market has a strong threat of new entry. There is very little patentable technology in game consoles, and most consoles tend to have similar features and functionality.
The greatest barrier to new entry is the economy of scale; producing consoles is prohibitively expensive unless done on a very large scale. In addition, a potential entrant would have to develop games to sell alongside the console. An exceptionally strong marketing campaign would be required since Nintendo, Microsoft, and Sony are already household names in many countries, which gives them a strong advantage in this sort of competition. Nevertheless, many large companies could potentially enter the market, as Microsoft did in 2001 with the introduction of the Xbox. Substitutes
Though they have negligible bargaining power, customers have a wide range of available substitutes, spanning over all sorts of possible forms of entertainment. In addition to competitors’ products available to them, they may choose television, movies, PC games, board games, literature, sports, etc. , in their leisure time. Thus, game consoles have to make an effort to be wanted since they are not needed. Complements Strong complements are an important part of getting customers to choose game consoles. The greatest complement to consoles is games, without which a console is useless.
Controllers and memory cards are also complements, as is the Internet, which allows players to network with each other and play video games with their friends. Nintendo’s handheld devices are also a complement for the consoles: the GBA could be connected to the GameCube, unlocking special features in some of the games. Rivalry Overall, there is strong rivalry in the console market. In 2004, there were three main competitors, all going after the same general audience. Product diversity was fairly low; the most significant difference between the consoles manufactured by Sony, Microsoft, and Nintendo was in the games available for each.
This led to price competition that drove prices down from the initial $200-300/unit to $100-150/unit. Nintendo, as the weakest competitor, would have suffered most loss from price competition. This situation gave a fairly strong indication that Nintendo would have to stop competing directly with Sony and Microsoft if it was to remain profitable. Strategies Available to Nintendo In 2004, a number of potentially successful strategies were available to Nintendo. It had become clear that a “stay-the-course” tactic would not allow Nintendo to beat Microsoft and Sony.
Vertical integration presented the opportunity to lower costs and expand into other markets at the same time. Exiting the game console market would allow Nintendo to continue making money on software and handhelds. A third and ultimately most promising strategy was differentiation from competitors, which would enable Nintendo to capture other market segments that had been largely ignored. Vertical integration Sony entered the game console market when it introduced the PlayStation in the mid-90s. Sony was able to make much higher margins than Sega and Nintendo because it was already a large manufacturer of consumer electronics.
Sony could design and manufacture parts for the PlayStation in-house while Nintendo had to buy parts off-the-shelf and outsource manufacture and assembly. This became a significant weakness for Nintendo which could be addressed by vertical integration, both into manufacturing and Internet service Integration of manufacturing has a number of advantages. Although it would cost a significant amount of money to expand, Nintendo would be able to dramatically reduce the cost of its consoles as well as complementing products such as controllers.
A lower cost would also allow Nintendo to introduce additional features to its consoles while maintaining lower retail prices than competitors. Nintendo could then expand into other consumer electronics markets such as cellular phones and digital music players. Integration of Internet service would involve developing an online gaming service similar to Xbox Live. This would greatly enhance the multiplayer capability of its consoles while providing an additional source of revenue: subscriptions. Although both of these integration tactics could be effective, they would not allow Nintendo to beat Microsoft or Sony.
Nintendo would never be able to match Sony’s capability or experience in manufacturing consumer electronics. Adding Internet services for newer consoles would only be adding a feature that Microsoft already provided to its customers. It would be unwise for Nintendo to base its new strategy on vertical integration, when both of its competitors were already very experienced in many other markets. Exit the market After Sega’s Dreamcast console flopped, Sega decided to exit the game console market entirely while continuing to develop software for other consoles.
This proved to be a fairly successful strategy. Like Nintendo, Sega had several popular game characters like Sonic the Hedgehog. The Dreamcast had proven to be a money pit; rumors had surfaced that Sega was losing money on each console sold. Slow sales drove down software sales as well. Sega games had the potential to be much more successful on a more popular console, and Sega could reduce its costs by ceasing hardware development. Although Nintendo’s GameCube was doing poorly against competitors, sales were still strong for handhelds and software.
There were no significant exit costs in the market, so the transition could be made cleanly by simply halting console hardware development and developing software for other platforms. Nintendo would still make a significant amount of money on high-margin software development and would still dominate the handheld market, at least in the short-term. The main disadvantages to this strategy are that it leaves Nintendo cornered in the longterm and that it does not hold the same potential for profitability as other strategies.
The handheld market was still vulnerable, and Sony had already introduced the PlayStation Portable as a competitor to the Game Boy Advance. Software sales could sustain Nintendo indefinitely, but would never restore the company to its former position. As such, this strategy should be used only as a last resort. Sega was forced to exit the market because it did not have enough cash to vertically integrate or to differentiate significantly from Nintendo and Sony. Exiting the market allowed Sega to survive, but nothing more. Differentiate from competitors
In the last several years, the game market had grown somewhat stale, although profits have remained high. Many game developers were focusing on the “hard-core” demographic: customers who were willing to invest a lot of time and money on a narrow range of games. Many new games were sequels, offering very similar game play to their predecessors. At the same time, games were becoming more complicated and difficult to learn for casual gamers. This presented Nintendo with an opportunity: create a console and games that appeals to people who had been ignored by Microsoft and Sony.
Although hard-core gamers were much more willing to spend money on games, they were outnumbered by casual gamers. The console would have to be easier to use than its competitors; a controller with 15 buttons would not be an option. The games would have to be easy enough to learn that someone who had never used a console before could learn and enjoy a game within a few minutes. Both consoles and games would also need to be cheaper to be more appealing to a wider range of customers. The primary advantage of this strategy is that it is one that Microsoft and Sony cannot effectively copy.
In order to appeal to the hard-core market, both companies were competing on hardware performance and features. In order to reduce costs enough to compete with Nintendo, they would need to abandon these goals, alienating their customers. Why differentiation was the best strategy The Nintendo Wii was originally conceived in 2001 shortly after the release of the GameCube. At the time, it was known by its codename “Revolution. ” It was first released on November 19, 2006, in North America. Its key feature was a new form of player interaction, nicknamed the “Wiimote”: a wireless controller that could detect its position in space.
In addition to using buttons and joysticks to control games, users could swing or point the new controller as they would with a sword or tennis racket. This provides gamers with a more enjoyable experience and much more intuitive interface than other consoles, especially if the game involves swinging swords or tennis rackets. Games for the Wii were also targeted at a broader audience, although few games have been released to date. The Wii is also much cheaper than the other consoles. It can currently be purchased for $250, less than half of the price of the PS3.
In the months since its release, it is estimated that the Wii has sold 4. 15 million units, overtaking both of its competitors. Although Nintendo may not be making such a large profit on each unit as Sony or Microsoft, a larger number of consoles on the market will drive software sales in the future. The only thing currently limiting sales is manufacturing capability, and of the three consoles in the newest generation, the Wii has been in shortest supply. Microsoft and Sony, as predicted, continued to appeal to the hard-core market with very advanced consoles.
For instance, Sony bundled its Blu-ray optical disc technology with the PlayStation 3 and included IBM’s Cell processors as the CPU, causing the price of the PS3 to be between $500 and $600. Microsoft included a wide range of media-center and online capabilities in the Xbox 360, expanding into the broader home entertainment market. While Microsoft and Sony’s strategies will undoubtedly be highly profitable, they will not be able to compete directly with Nintendo without alienating their existing customer base. Sources January Game Sales Explode; Wii Dominates. GameDaily BIZ. Feb 21, 2007. http://biz. amedaily. com/industry/feature/? id=15294=AOLGAM000500000000021. Nintendo Says Women, Elderly Key to Wii Game Player. Bloomberg. com. Sept 18, 2006. http://www. bloomberg. com/apps/news? pid=20601080=asia=a0kklJ1sNgDI. Nintendo Annual Reports, 2002-2006. http://www. nintendo. com/corp/annual_report. jsp. The Nintendo Strategy Wednesday, December 21, 2005 I’m going to define two phrases for you — the “current video game industry” and the “other video game industry”. Current Video Game Industry – the current video game industry grew from the idea that better technology leads to better games.
The current video game industry anticipates the next-generation because it promises bigger environments full of better and flashier graphics. The current video game industry gives the award for “Game of the Show” at the Electronic Entertainment Expo to technical or video demonstrations rather than playable software. Other Video Game Industry – the other video game industry is growing from the idea that good technology, good interactivity, good variety, and good access ultimately breeds better games for more people. The other video game industry acknowledges that a variety of games within a selection of genres CAN appeal to everyone.
The other video game industry recognizes that, at the end of the day, games are about interactive entertainment. Sony and Microsoft are pursuing the current video game industry. And there’s absolutely nothing wrong with that. The current video game industry, although perhaps not entirely healthy, has nevertheless proven itself to be profitable and highly lucrative. Many fortunes have been made and will continue to be made from this market. Nintendo, however, has identified the other video game industry. Nintendo has nothing to gain from copying the competition and pursuing their current video game environment.
Besides, Sony and Microsoft already adequately satisfy that segment. The reasoning behind Nintendo’s new pursuit is especially apparent when you consider the fact that the current industry has shown over and over again that there is only room for one or two profitable console manufacturers. In 1996, Michael Porter wrote an article for the Harvard Business Review asking the question, “What is Strategy? ” That’s a great question and relevant to our discussion. Is strategy achieved by copying competition? “A company can outperform rivals only if it can establish a difference that it can preserve,” notes Porter. It must deliver greater value to customers or create comparable value at a lower cost, or do both. ” These ‘differences’ are ultimately born from the hundreds of activities performed in the creation, sale, and delivery of a product or service. Costs result from performing activities. For example, the cost of acquiring materials or the cost of employing workers. Meanwhile, a ‘cost advantage’ results when one of these activities is performed better or more efficiently than competitors. For example, acquiring cheaper materials or employing workers from overseas.
According to Porter, activities are therefore the basic units of ‘competitive advantage’. Before improvements in activities: An item costs $4 to manufacture and is sold for $5. You receive $1 in profit. After improvements in activities: An item costs $3 to manufacture and is sold for $5. You receive $2 in profit. Makes sense right? The more efficient the activities in your operations are, the more likely you are to generate a greater profit. The video game industry is built upon this premise. It begins when a manufacturer sells a technologically advanced console at a price less than it costs to create.
The manufacturer ultimately hopes to earn a profit by making the activities that produce the hardware (or acquire its technical components) more efficient and also by launching software which is built from an engine that is then efficiently re-used to release a sequel. This series of steps is conducted and repeated by multiple console manufacturers. By the conclusion of a console cycle, there is usually at least one manufacturer who successfully improves the efficiency of its activities to gain an enormous profit. As a result, they also reinforce the allure of this flawed model.
This management practice — called operational effectiveness — is not sustainable nor is it a strategy. “Constant improvement in operational effectiveness is necessary to achieve superior profitability,” says Porter. “However, it is not usually sufficient. Few companies have competed successfully on the basis of operational effectiveness over an extended period, and staying ahead of rivals gets harder every day. ” Competition assures that it’s only a matter of time before your activities are mimicked and your competition acquires similar operational efficiencies.
Porter describes this as follows: “The more benchmarking companies do, the more they look alike. The more that rivals outsource activities to efficient third parties, often the same ones, the more generic those activities become. As rivals imitate one another’s improvements in quality, cycle times, or supplier partnerships, strategies converge and competition becomes a series of races down identical paths that no one can win. Competition based on operational effectiveness alone is mutually destructive, leading to wars of attrition that can be arrested only by limiting competition. Is it any surprise then that the entire video game industry is consolidating? Merger after merger from Sega Sammy, to Square Enix, to Namco Bandai. As long as the current video game industry continues down the path it is on now, this consolidation has no hope of ending. The Nintendo Strategy On the other hand, there is strategic positioning. This superior and legitimate strategy is accomplished by performing different activities or even similar activities but in different ways. “Competitive strategy is about being different,” says Porter. It means deliberately choosing a different set of activities to deliver a unique mix of value. ” Strategic positioning is ultimately a unique set of sustainable activities that use your company’s valuable, rare and inimitable resources to change the rules of the game. As a result, Nintendo’s unique set of chosen activities are bound to cause controversy among the “current video game industry” — you know who I’m referring to, that audience who is content playing sequels with updated graphics and using the same input method (i. . controller) multiple generations in a row on several consoles that are, for all intents and purposes, the same. Strategic positioning is about being different. Nintendo has therefore decided to uniquely devote its resources to expanding the game playing audience through two keys things: “strong community” and “immersive games”. You can see these goals mirrored in, for example, the restructuring of Nintendo’s development divisions, the Nintendo Wi-Fi Connection, and the makeover of Nintendo Power — these aren’t coincidences.
They are a chosen part of Nintendo actively piecing together its activities to fulfill its strategic position to expand the game playing audience. “A company can outperform rivals only if it can establish a difference that it can preserve,” says Porter. The difference Nintendo is establishing with the Revolution is a low-cost device with an accessible interface. The accessible interface will largely come in the form of its revolutionary controller, but also in the simple, yet elegant, design of the console. In addition, Nintendo will not only have low-cost hardware, but also low-cost software and a free online community.
Nintendo is also changing things up with its virtual library of NES, SNES, and N64 games. This is a new and unique distribution model that has the potential for great success. Low cost hardware and software, a new intuitive gameplay input, and original game genres are a unique set of sustainable activities that, when combined, form Nintendo’s strategic position. “But why can’t Nintendo have high-definition graphics? ” exclaim current gamers! Don’t worry, I hear ya and I’ll explain exactly why they can’t. There is an absolute need for trade-offs.
When there are no trade-offs, you encounter a situation that Microsoft is currently in — billions of dollars in losses within its Xbox division. This shouldn’t come as a surprise, but trade-offs are an intimate part of our daily lives. We make trade-offs with our time (do I spend it studying or playing Zelda), trade-offs with our money (do I buy school books or buy Barbie dolls), trade-offs with what we watch on television (Oprah or Jenny Jones), etc. This is why the “Nintendo Difference” is seen much more clearly today than it was during the GameCube generation.
The GameCube was the tragedy of not recognizing that trade-offs are needed. Nintendo wanted to offer an accessible low-cost box with a handle, yet it also wanted to directly compete with Sony and Microsoft in the current video game industry. Nintendo wanted to create small pick-up and play software that appealed to casual gamers, yet it had graphics and a controller intended for the current video game industry. Conflicting activities, contradicting goals, and lack of trade-offs — from the very beginning, the GameCube and Nintendo’s strategy were doomed to take second place to Sony and Microsoft.
Ultimately, Sony and Microsoft could also sell their consoles for cheap, create a new controller and develop new game genres. They could without a doubt try to cater to Nintendo’s other video game industry. However, just like GameCube proved to us, they are doomed to fail if they refuse to make trade-offs. “Attempts to compete in several ways at once create confusion and undermine organizational motivation and focus,” notes Porter. This is exactly why high-definition graphics don’t mesh with Nintendo’s strategy. A company simply cannot be anything and everything.
A dollar can only be stretched so much, advertisements directed only so far, and resources allocated only so deep. Nintendo has learned that it cannot be Sony nor Microsoft. And without drastically altering their business, Sony and Microsoft will likewise never be able to replicate the structure of Nintendo’s development studios, the low cost of producing Revolution hardware, the unique interface in the Revolution controller, or the virtual catalog of NES, SNES and other retro titles. Nintendo’s trade-offs are therefore as much part of its strategy as are the chosen activities just mentioned.
Apple’s set of activities formed a strategy that revolutionized the music industry. I’ve mentioned before that a ‘revolution’ is the sum of its parts. If Nintendo successfully molds its already unique set of activities (Nintendo, please don’t forget innovative marketing — I’m looking at you Reggie) to fit into a single cohesive strategy… the other video game industry is theirs for the taking. “It is harder for a rival to match an array of interlocked activities than it is to merely imitate a particular sales-force approach, match a process technology, or replicate a set of product features,” says Porter.
As we’ll soon see in 2006, Nintendo’s strategic position will be hard, perhaps even impossible, to match. Best of luck to the imitators. [pic] The Nintendo Difference “Nintendo stays in hardware because it has no choice in the matter… ” No company frustrates the soothsayers quite as much as Nintendo. Across the land, divining rods are being snapped, crystal balls are being smashed and tea leaves are being stamped on in fury – as the firm whose death has been predicted countless times reveals itself once again to be in rude good health and ready to take on the world. I refer, of course, o the launch of the Wii in Europe, which saw the firm clocking up a record breaking 325,000 sales over the weekend; but even more astonishing, and more laudable, is the stunning success of the Nintendo DS in the same week. Over half a million units of the handheld were sold in Europe last week, and the installed base now tops 8. 5 million units in this territory alone. If this is an indication of how the Wii’s sales will go, then Nintendo’s risky gamble with the motion sensing Wiimote could actually turn out to be the stroke of genius which hands dominance of the console space back to its one-time master.
As the Kyoto-based firm continues to confound the doom-mongers who have gleefully predicted its demise for the best part of a decade, it’s worth pausing for a moment to think about the other common prediction which is associated with Nintendo – namely that the company will (or at least, should) abandon the hardware market entirely, and instead focus on bringing its unique range of IPs and franchises to other platforms. Going third-party – or “doing a Sega”, as industry slang would have it.
The most common argument for this strategy is that while Nintendo may be hugely profitable, the company’s home consoles are in distant second or even third place behind those of the market leader – so in theory, by moving franchises like Mario and Zelda to the PlayStation and the Xbox, the firm would have a much larger target market, would sell more units, and would ultimately be much more successful. This is particularly relevant now, proponents of this model argue, because the astonishing cost of the new generation of consoles has forced Nintendo out of the arms race, leaving its games confined to an innovative but underpowered system.
On the face of it, it’s a compelling argument – and it certainly worked for Sega, which has turned around its fortunes since bailing out of the Dreamcast (aided, admittedly, by being acquired by wealthy Japanese gambling firm Sammy) and is now one of the most influential third-party publishers in the industry. Why shouldn’t Nintendo follow Sega’s example, then, and leave the CPU and GPU arms race to the multinational giants with cash to burn?
The simple answer is because “The Nintendo Difference” isn’t just a cunning marketing slogan; Nintendo genuinely is different. Its structure and business model are a radical departure from how every other company in the interactive entertainment industry works, and the comparisons between Nintendo and Sega are merely skin deep. Sega left hardware because it had no choice; the failure of the Dreamcast was a nail in the coffin, and the structure of its internal studios was perfect for transplanting into a third party publisher.
Nintendo stays in hardware because it, too, has no choice in the matter. Of course, on a very simple level, if Nintendo was to leave hardware then it would lose a major revenue stream, because the company notoriously designs and prices its consoles such that hardware is a profit-making enterprise. Making up for that lost revenue would also be tougher than it looks, because as a third-party publisher, Nintendo would be forced to pay a significant license fee on each game it sold, so its profit margin from software would be reduced.
As such, the company would have to vastly increase its software sales in order to make up both for reduced margins and for the loss of the hardware revenue stream – an incredibly daunting task, even for a firm with franchises like Mario and Zelda. Bear in mind that those franchises already sell millions of copies, and have an astonishingly high attach rate with Nintendo hardware – even on a system with five times the installed base, achieving higher sales would be a challenge.
Even more important, though, is the change which would have to be made to Nintendo’s entire culture, to its business and creative models, if it were to abandon the hardware market. Considering this gives an insight into the workings of one of the most fascinating companies in the videogames market – a firm which is quite unlike its competitors, with an approach which owes more to that of a toy company than to the videogame publishing model. Nintendo’s entire philosophy is focused on the platform – not on hardware or software as separate entities or businesses, but as the platform as a whole.
Unlike Sony and Microsoft, where it’s apparent that Chinese walls have been erected between the designers of the hardware and the creators of first-party software, Nintendo actually places its top software designers at the helm of hardware design. Consoles are designed to suit the game concepts which will run on them – a working model which is apparent in the design of both the Nintendo DS and the Wii, and which allows the company to create early first-party titles which really showcase the hardware.
This top-down approach, which creates consoles based on the games which will run on them, is the antithesis of Microsoft and Sony’s approach, which designs from the bottom up – first creating a console and then worrying about what games will run on it. It gives Nintendo an enormous competitive advantage which would not be evident if it were a third-party publisher, and allows its top first-party software to innovate and evolve in ways which would be impossible on another company’s hardware.
It’s also the approach which has informed the decision to restrain the specifications of the Wii – and indeed the DS – to a manageable level, which allows development to take place faster and less expensively than on rival consoles. These factors combine to make Nintendo into the company it is today – a company whose low development costs, tight integration between hardware and software and enormous profit margins allow it to take creative risks, drive forward innovation and promote the growth of the gaming market as a whole.
Without Nintendo’s unique business model and first-party status, games like Nintendogs, Brain Age, Animal Crossing and Wario Ware simply could not exist; they either rely heavily on the hardware which supports them, or are so far off the beaten track that creating them on a system with higher development costs and lower profit margins would be commercially untenable. That’s why Nintendo will remain in the hardware business – because its consoles are more than just a platform to run its software on.
They are part of a platform strategy which defines the entire company’s approach to the market, and which means Nintendo is more than just one of the world’s leading videogame companies – it is also, and arguably more importantly, one of the world’s leading toy companies, and remains a powerhouse of innovation and development which is a driving force for the entire games sector. “Doing a Sega” is not on the cards for this firm, and probably never will be – especially not when it’s still in the enviable position of being able to shift the better part of a million units in Europe in a single week.
The New Sony PSP Handheld: a Clear Victory of Form Over Function [pic] Sony’s innovative new PSP (PlayStation Portable) gaming and media handheld – aka, “the iPod killer” – was introduced last Thursday, and then… today (Monday 28 March) it was ordered withdrawn. Immersion Corp. , a San Jose company who, in a 2002 lawsuit, accused Sony of patent infringement with the Dual Shock controller for the PlayStation and PlayStation2. Dual Shock technology makes the controller shake in rhythm with what’s going on in the game.
Sony denies that Dual Shock violates Immersion’s patents and, while the district court decision included an order to suspend PlayStation sales, that order does not hold while an appeal is being heard so Sony will continue to sell its game machines in the United States. But the bigger question may be, will anybody buy this thing? The PSP faces tough competition from the Nintendo DS as it sparks a battle for the $4. 5 billion global handheld entertainment market, just at a time when Sony’s in the midst of a pitched internal battle to get back on its feet after product successes fell short.
Then, the PSP launches as more of a legacy product than anything – c’mon guys, the Memory Stick is a big failure and your failure to use non-proprietary technology standards will lead to the ultimate failure of the consumer electronics business in the long-run! I cannot believe you people can’t see this!?! Simply stunning. Anyways, Red Herring broke it down for us on how the competitive battle lines are drawn: The PSP’s unique features are console-quality graphics, a 24-title movie lineup, Wi-Fi capabilities, and the amalgamation of games, music, and movies in one gadget.
Sony is expected to ship at least 3. 7 million units to North America during 2005, according to research firm IDC. Nintendo, so far, has been the leader in the portable gaming market with the GameBoy Advance and, more recently, the $150 Nintendo DS. The $250 PSP is the “first legitimate competitor to Nintendo’s dominance” in the handheld market, said IDC analyst Shelly Olhava. Other competitors in the market are Nokia’s Ngage portable and Gizmondo Europe’s portable. David Cole, an analyst with DFC Intelligence, thinks that the PSP could become a long-term product and build a base for Sony for several years. [Sony] is so strong in the game industry, it should do very well,” said Mr. Cole. “It really satisfies the need of the portable audience. ” The target audience for the PSP is adults between the ages of 18 to 34 rather than the younger audience gaming companies usually target. Nintendo, on the other hand, is more popular with the younger audience. “I think Sony decided that’s where they were really strong,” said Mr. Cole. The PSP is a black gadget weighing just under 10 ounces with a 4. 3-inch widescreen and high-resolution TFT display.
It also has digital photo display and supports digital music playback in MP3 and ATRAC formats. The processor is a high-capacity Universal Media Disk (UMD), which is an optical medium enabling feature films and high-quality games to be played on the portable. The 60-mm disk has a storage capability of 1. 8 GB. This format will be utilized across the Sony family of products and is available for outside hardware makers and non-game entertainment content providers to use. The portable gaming market worldwide was about $4. billion in 2004 and is expected to grow to $9 billion in 2009, according to DFC Intelligence. The PSP first launched in Japan on December 12 and has sold 1. 18 million units there so far. Mr. Cole expects the PSP to get a better reception in North America, where Sony plans to ship 1 million units for the launch. Company officials said that most U. S. stores are on their third and fourth waiting lists for the PSP. “The Japan market hasn’t been doing very well in general. Any product tends to do better [in the U. S. ],” he said. European launch uncertain
Analysts are expecting long lines outside stores on the night of the launch in North America. The demand for the PSP has reached such a peak that its European launch, which was scheduled for March 31, could take several more months. Ms. Olhava said Sony hasn’t been able to handle shipments because of logistical problems. “I have heard that Sony has manufacturing issues,” she said. “It’s a brand-new product and it’s bound to have some hiccups along the way. One problem could be the $250 price. “It’s an unproven price point and that will be a real challenge,” said Mr. Cole.
Early adopters are price-insensitive, he said, but consumers will get tighter with their wallet after the first 1 million sales. The Nintendo DS has already launched in the three major markets—North America, Europe, and Japan. The DS, which launched in North America on November 21, sold 1. 5 million units by February. Company officials have said that Nintendo plans to ship 6 million DS units globally by the end of March. Analysts feel the 2005 holiday season and the software availability will determine which portable product succeeds. “Both the DS and PSP are excellent portable systems,” said Mr.
Cole. “You really will be able to get the analysis going into the holiday season. ” Meanwhile, every review I’ve read of the device itself leaves me wondering if it’s worth the trouble. Jim Louderback has a few backhanded compliments in that regard, “it’s going to redefine handheld gaming. But it’s not going to be as popular or as successful as everyone claims. If Sony’s expecting an iPod killer, this isn’t it. Here’s what I see as the good and the not-so-good in Sony’s latest platform. ” More of his review is excerpted below: Screen: A standout display, for sure.
It’s big, wide, and captivating. Colors are rich and detailed. Response rates seemed superb while I was playing Ridge Racer. But there’s a downside to all those pulsating pixels, too. First, Sony opted for a very reflective coating. This makes the image look great, but also turns the screen into a mirror in bright light. Even in lower light, the reflections can become annoying in some situations. Don’t plan on taking it hiking; this is not a player for the great outdoors. Graphics: Far better than the competition’s, the graphics engine made the smallish screen look much bigger.
Although some of the early titles probably won’t take advantage of all the power, Ridge Racer at least looked fantastic. Sound: I have no complaints here. The audio quality was simply stunning on my tests, especially when paired with high-quality headphones. The built in speakers are weak and tinny, as you can imagine, but the top-notch audio—when combined with the zippy screen—creates a truly immersive gaming experience on the go. Controls: The PSP includes the standard complement of PlayStation 2 controls—although it has only one joystick and one pair of shoulder buttons—and pads that are reasonably easy to use.
It has no touch screen, unlike the Nintendo DS, but includes a real portable-gaming breakthrough: a tiny round nub that appears to be the twisted progeny of a joystick and the IBM TrackPoint mouse replacement. Instead of having to be yanked back and forth, this “pointing pad” glides almost effortlessly across a small part of the PSP’s surface. It provided a perfect stand-in for a steering wheel in Ridge Racer, and it’ll probably become the controller of choice for all but the most precise and demanding tasks.
Games: The PSP’s launch library is good for a new platform, with about two dozen titles available now. Over time, expect to see PS2 retreads and brand extensions galore. But those titles will only reinforce one of the PSP’s problems: It’s a portable version of a home console, but nothing more. The Nintendo DS, with a touch screen, microphone, and unique dual-screen design, offers more potential for breakthrough styles of portable gaming that don’t rely on the archetypes established by console games. Just because you build it, however, doesn’t mean they’ll come.
Even though the DS has been out for four months, only a paltry number of titles are available, and few take much advantage of the unique DS features. The DS has one ace card: It’s compatible with the huge library of Game Boy Advance titles too, which makes it a better upgrade for existing Nintendo handheld customers. Movies: The PSP has also been widely touted as a portable movie player. The device includes a new optical disc format, called UMD (for Universal Media Disc). Each disc is about twice the size of a quarter, and can hold an entire movie. In fact, the first million PSPs here in the U.
S. will come bundled with Spider-Man 2 on UMD. Sony’s penchant for launching unsuccessful proprietary media formats is legendary (witness Beta, Memory Stick, etc. ), and I believe UMD as a broad media storage technology will fail here, too. Why? First, because it’s highly unlikely that many users will purchase movies in a format that works only on portable players—and no one will replace their home DVD player to go with UMDs. Movie availability is likely to be limited to Sony’s back catalog and a smattering of other titles at first, so there won’t be much to watch. What about rentals?
The picture is murky there, too. Shernaz Daver, from Netflix, said that the company “will support any format as long as it becomes popular,” but wasn’t ready to commit at launch. The big bugaboo here is that you can’t make your own discs. And if Junior can’t drop Letterman or the X Games onto a disc at night and watch it the next day, then the idea that any significant number of people are going to buy the PSP to watch videos is moot. About five years ago, a company called Data Play released a nifty new quarter-sized optical media format. It was recordable, tiny and promised a revolution in media players.
But before Data Play could get it to market, tiny hard-drive and flash-based players took off. Data Play sunk without a trace, and even though Sony has far bigger resources to bring to bear, UMD will too. Oh, one other fundamental drawback for the PSP as a movie and video player: It lacks a kickstand or other way to keep it upright. Playing games is interactive; you want to hold the player while you frag. Watching video is passive and, based on my experience with first-generation portable video systems from Archos and Creative, if it doesn’t stand on its own, it just isn’t worth carrying.
Music: The PSP has the potential to be a great music player, but unfortunately it relies on a flash-based Memory Stick to store music. The system comes with a 32MB Memory Stick, enough for an hour or so of very compressed music—if you didn’t have to share the Memory Stick with saved games. But even if you also picked up a 1GB Memory Stick—for an additional $130—you still wouldn’t have enough space for music. I frequently hear iPod Mini users complain that even 4GB isn’t enough for them. Sure, you can pick up a 4GB Memory Stick, if you’ve got a spare $500 lying around.
I suggest a Creative Zen Xtra or Apple iPod instead. In a pinch, the PSP can stand in as a music player. But until you can load 10GB or more onto the system—without spending as much on the memory card as you would on a brand new iPod—few people will use it as their primary music player. To support music and movies, Sony will have to add a mini-hard drive to the PSP, which will only make it heavier and more power-hungry. Battery Life: Speaking of power, Sony claims you can get six hours of hard-core game play or movie playback on a single charge. If the PSP delivers on that promise, that’s good.
Based on my own experience with battery-powered devices, though, you’re better off cutting that number in half. Even three hours of game play or movie watching is pretty good, except when your batteries cut out during a long flight or a boring class. Better pack a spare battery or two. Price: $250 for a game-playing, movie-watching, music-playing device is pretty darn good, especially for one with a screen as beautiful as the PSP’s. It must cost them more than that to make each one, which means they intend to profit on the games and the movies, instead.
To justify that price, though, the PSP will have to do more than just play games, as Nintendo’s offerings cost half as much or less. Many hard-core gamers will certainly pony up, but the jury is out on whether enough casual gamers will adopt it to make it a success. My best guess is no. Connectivity: Like the DS, the PSP will ship with built-in wireless networking. That’s great for group gaming, but why is there no built-in Web browser or e-mail client? And no way to connect your PSP to your PC wirelessly to transfer music and movies to the Memory Stick?
All the parts are there, but the whole is sadly lacking. I, for one, would love to see Skype for the PSP—that would have been a real breakthrough! Reliability: This is the great unknown:. How well will the PSP hold up to months and years of heavy playing and portable jostling? I’m not particularly bullish, especially because that large screen is unprotected. Sure, the PSP comes with a slip-on foam case, but it’s so nondescript that I almost lost it five times in one week. In just a few short months, a scratched screen will take much of the luster off of the PSP.
The Nintendo DS’s clamshell design makes it much more likely to survive years on the road, especially in the backpacks of all those hyperactive kids and one clumsy journalist. I was almost scared to travel with the fragile-seeming PSP, particularly because we only had one in the entire company. And how long will the battery last? Regular gamers will probably need a new one every year or so, which creates a tremendous after-market opportunity. Finally, what about the internal software? Is it robust enough for all the banging—and hacking—that’s bound to go on?
Will it need regular flash updates? And how do you distribute a flash update to the PSP if you don’t have a wireless network? Via UMD? Memory Stick? I don’t know about you, but I certainly don’t have a memory stick reader for my PC. Fortunately there’s also a standard USB 2. 0 port. Perhaps you’ll download updates off the Web site and send them to the PSP via this port. All in all, I think the PSP will be extremely popular among hard-core gamers, especially those who spend hours each week banging on their PS2s.
I wouldn’t buy it for kids, though, because it’s too fragile. And I think the lack of robust media playback—non-writable UMD, paltry and expensive Memory Stick storage options—make it less than ideal for casual gamers. In the end, the PSP excels at just one thing: portable gaming. Casual gamers who already own a satisfactory portable gaming platform, whether it’s an old Game Boy Advance or even a game-playing cell phone, have little incentive to switch. And anyone looking for a portable media player that will unseat Apple’s iPod needs to keep looking.
Because when it comes to everything else, the PSP just doesn’t cut it. And, PC Magazine sums it up even more concisely, a victory of form over function: Those in the target demographic have eagerly awaited its arrival. And even people other than 15- to- 25-year-old males may have more than a passing interest in one of the year’s most anticipated pieces of gadgetry: the Sony PSP. Originally conceived as the PlayStation Portable (and now simply called the PSP), the slick, gorgeous device succeeds spectacularly as a portable gaming console.
If you view its music- and video-playback capabilities as bonus features, you’ll be thrilled; if you were hoping it would be best-in-class at all its endeavors, you’ll be slightly disappointed. Clearly breakthrough product innovation can make or break the company that gets it to market; but there must be a compelling customer value-proposition inherent in the product itself, differentiated in the way it is built/sold/positioned, or it must be disruptive to existing markets for there to be a hope for success. It sounds to me like the Sony PSP falls short on all three counts, despite all the hype and lawsuit PR. Arik How the Wii is creaming the competition Business 2. 0 Magazine tells the inside story of how Nintendo outfoxed Sony and Microsoft and got itself back in the game. By John Gaudiosi, Business 2. 0 Magazine April 25 2007: 9:58 AM EDT (Business 2. 0 Magazine) — A year ago it looked like game over for Nintendo’s storied console business. The Kyoto-based gamemaker–whose Nintendo Entertainment System ushered in the modern age of videogames–was bleeding market share to newer, more powerful systems from Sony and Microsoft. Even as the videogame business grew into a $30 billion global industry, Nintendo saw its U.
S. hardware sales shrink to almost half of what they had been nearly 20 years earlier. |[pic] | |The Wii is reversing 20 years of declining | |Nintendo console sales. | |[pic] | |The DS broadened Nintendo’s market. The Wii goes| |even further; grade-schoolers and grandmas are | |getting into the swing. | [pic] | | | | | | | |CNN’s Nicole Lapin talks with Scott Steinberg of| |Embassy Multimedia about the latest in gaming | |systems. | | | |Play video | | | | | | | | | Today, as anybody within shouting distance of a teenager knows, Nintendo is the comeback kid of the gaming world.
Instead of joining Sony (Charts) and Microsoft (Charts, Fortune 500) in the arms race to pack their consoles with ever-higher-performance graphics chips (to better attract sophisticated gamers), Nintendo built the Wii–a cuddly, low-priced, motion-controlled machine that broke the market wide open by appealing to everyone from grade-schoolers to grandmas. Unorthodox? Maybe. Effective? You bet. The Wii is a pop culture smash of such dimensions that Nintendo still can’t make consoles fast enough. Even so, it’s outselling Sony’s PlayStation 3 and Microsoft’s Xbox 360–at least since January. The Xbox had blowout pre-Christmas sales. ) And while its competitors lose money on every console they build, expecting to make it back selling high-margin games, the Wii was designed to sell for a profit from the get-go. Nintendo blows by forecasts Nintendo’s turnaround began five years ago, when the company’s top strategists, including CEO Satoru Iwata and legendary game designer Shigeru Miyamoto, zeroed in on two troubling trends: As young consumers started careers and families, they gradually cut back on game time. And as consoles became more powerful, making games for them got more expensive.
Studios thus became more conservative, putting out more editions of Madden NFL and fewer new, inventive games that might actually grow the market. Iwata and Miyamoto eventually concluded that to gain ground, Nintendo would have to do something about the game controllers, whose basic design had hardly changed since the first NES paddles. Changing how the controllers interacted with the consoles would mean changing how engineers designed a system’s electronics and casing and eventually the games themselves. The first product to test the new strategy was not the Wii but the DS handheld game system, released in 2004.
To appeal to a broader audience, Nintendo abandoned the kid-friendly Game Boy name it had given its other popular handhelds, while building in Wi-Fi networking, voice recognition, and two screens (See correction below). The idea was not to load the DS with technology but to help draw in new gamers by offering options other than the old button-based controls. Some DS games would work through the tap of a pen and simple voice commands. The trouble with gee-whiz gadgets The $150 gadget got off to a tepid start. Until gamers tried it, they tended to be wary. People thought it was weird,” says Perrin Kaplan, vice president for marketing at Nintendo of America. “It took about two years for people to warm up to it. ” But warm up they did, largely thanks to Miyamoto. The creator of Nintendo’s blockbuster franchises–Donkey Kong, Super Mario Bros. , Legend of Zelda– offered up Nintendogs, a Tamagotchi-like simulation in which players use every feature of the DS to nurture virtual puppies. The game struck a chord with female gamers in particular, says John Taylor, an analyst at Arcadia Research. During the first holiday season after Nintendogs hit the market, Nintendo sold 5. million DS units–a standout performance that was nearly twice its total for the rest of the year. Soon after Nintendogs, the company released Brain Age, a game designed for more mature players in which they solve a series of puzzles by filling in answers or speaking phrases aloud. “That further bolstered the market by attracting older boomers and even senior citizens,” Taylor says. The DS surge encouraged Nintendo executives, who saw their strategy to grow the market taking shape. They wouldn’t have to wait long to put it to a bigger test. Work had already begun on the console, code-named Revolution, that would become the Wii.
Club Penguin, Webkinz corner the tween market Nintendo’s top strategists knew early on that they wanted to build a machine with a wireless, motion-sensitive controller. But equally important was the chip that would be the brains of the Wii console itself. The more powerful processors that Sony and Microsoft were using would make the screen action look better but would also guzzle more electricity. What if Nintendo used a cheaper, lower-power chip instead? After all, the DS, with its efficient mobile processor, had already proven that you could create new gaming experiences without the fastest chips.
A low-power chip also meant that the machine could be left on overnight to download new content. It was settled: The design team made the risky decision to build the Wii around a chip similar to the one that powered the GameCube, an earlier Nintendo entry that posted disappointing sales. If the Wii succeeded, it wouldn’t be on the strength of breathtaking graphics. Next, engineers settled on a new approach for the Wii’s looks. Just as the DS shunned the Game Boy name to appeal to a broader audience, the Wii would adopt a sleek white exterior instead of the toylike loud colors used on the GameCube.
Even CEO Iwata got involved in the design process; at one point he handed engineers a stack of DVD jewel cases and told them the console should not be much bigger. Why so small? To work with the motion-sensitive wireless controller Nintendo planned, Iwata reasoned, the console would have to sit directly beside the TV. Make it any larger and customers would hesitate to leave it there. Videogames get real While the console team worked on the shell, Miyamoto and another team perfected the controller.
He was determined that its design be as simple as possible–he insisted on several revisions that enlarged the “A” button to make its importance obvious. When design work was done, players could arc the Wii remote to throw a football in Madden NFL 07, tilt it to steer off-road vehicles in Excite Truck, and swing it to play sports like Wii tennis and baseball. Market tests suggested that the product was everything its designers hoped: engaging enough that nongamers might give it a go, and simple enough that newbies could quickly get up to speed. Finally it came time for Nintendo to market the Wii to the world.
In addition to its standard TV campaigns targeting schoolkids, the company pumped 70 percent of its U. S. TV budget into programs aimed at 25-to 49-year-olds, says George Harrison, senior vice president for marketing at Nintendo of America. He even put Wii ads into gray-haired publications like AARP and Reader’s Digest. For Nintendo’s core users, he took a novel, Web-based approach: “To reach the under-25 audience,” he says, “we pushed our message through online and social-networking channels” including MySpace. But Nintendo’s most effective marketing trick was to give away its killer app, Wii Sports, with every $250 console.
It was a calculated attempt to speed up the process that brought success to the DS. And because Nintendo makes about $50 in profit on every Wii sold, it can afford to give away a game. To be sure, not everything has gone according to plan. Although Nintendo shipped more than 3 million Wiis in 2006, supply-and-demand problems have plagued the machine since its launch. Demand continues to outpace supply and may continue to do so until summer. It’s a problem many businesses wouldn’t mind having, but it means that Nintendo might be leaving money on the table–something no company can afford to do for long, not even the newly revived Nintendo.
John Gaudiosi is a freelance journalist in Raleigh, N. C. Nintendo’s marketing strategy impresses Microsoft Submitted by Shubha Krishnappa on Sat, 06/09/2007 – 07:43. :: • Technology • Top Story • United States After year-long speculation that Microsoft is planning to cut Xbox 360 prices, the software giant on Friday gave the hints that its most powerful video game and entertainment system, Xbox 360 will soon see a price drop, apparently realizing the fact that consumers react well to lower cost consoles.
Picture: Get original file (8KB) Full Article: In an interview with Bloomberg Microsoft’s David Hufford, a director of Xbox product management admitted that USD 199 price point is the “sweet spot”. “We are well aware that the sweet spot of the market is really 199 bucks,” Hufford said in the interview. As the world’s largest software maker recently has committed to add more family-orientated games, Hufford thinks US$199 is the ideal price for the family audience.
With its plans to cut the price of Xbox 360 and add more family titles, Microsoft apparently is trying to follow its rival Nintendo’s success in the gaming industry. Among the trio of next generation gaming consoles, Nintendo has emerged as the numero uno in April for the fourth consecutive month after selling 360,000 of the popular video game devices in the United States, repeatedly outshining both its rivals Microsoft’s Xbox 360 and Sony’s PlayStation 3 in the US video game consoles market.
The more-powerful systems, Sony’s PlayStation 3 and Microsoft’s Xbox 360, in April, again lagged behind in the fierce battle for dominance in the booming gaming consoles market by moving 82,000 and 174,000 units, respectively. Launched in November last year, Nintendo’s Wii console retails for $US250, while PS2 costs only $129. The PS3 and Xbox 360 start at $499 and $299 , respectively, while their high-end versions are priced at $US599 and $US399(Xbox 360 Premium System) and $US479 (Xbox 360 Elite System), respectively.
During his discussion with Bloomberg, Hufford confessed that besides the youngsters Nintendo Wii has drawn an audience that wouldn’t normally play games, such as soccer moms, and the elderly. Making a remark on Nintendo’s low-cost gaming device, Hufford said “When Mom walks into the store and sees she can get a console with a game for USD 250, she sees it as a USD 300 value. They’ve done a good job”. Impressed with the way Nintendo has attracted the women, children and the elderly, Microsoft now intends to adopt the Japanese company’s marketing strategy to win a broader audience than the first Xbox attracted.
The Redmond giant hopes this move will help it shake off its ‘hardcore’ image that hampered sales of its sixth generation era video game console, the original Xbox, which was first released on November 15, 2001 in North America. “If we don’t make that move, make it early and expand our demographic, we will wind up in the same place as with Xbox 1, a solid business with 25 million people,” said Peter Moore, Microsoft’s Head of Interactive Development. “What I need is a solid business with 90 million people. “
Although, Microsoft has not yet clearly confirmed price cut for the console, but Heather Bellini, analyst for the Institutional Investor, foretells that a price reduction may happen as soon as September. “If they really are going to have a good Christmas games line-up, then they just have to have the largest number of boxes out there so that they sell the largest number of games”, commented Bellini. Earlier this month, Microsoft has added Blinky, Clyde and other Pac-Man hallmarks to its Xbox 360 game consoles.
Microsoft, which has always tried to hook more and more customers, now has made Pac-man, the legendary game, its weapon to boost the sales of Xbox 360. In March, Microsoft Game Studios and Bungie Studios revealed the first details of the three editions, “Standard”, “Limited” and “Legendry”, of the most-eagerly anticipated Xbox 360 game, “Halo 3”, which will hit stores later this fall, also giving gaming enthusiasts three different purchase options.
Announcing the three different SKUs of Halo 3, the companies have divided the gaming community in three kinds: First, those who are really, truly desperate for Halo 3, then those who are sort of desperate, and lastly those who are just your garden-variety desperate. The companies said that the three different editions are adapted for the tastes of all kinds of gamers. New challenges for Nintendo Ryan Kim, Chronicle Staff Writer Monday, November 30, 2009 [pic] The Nintendo Wii, the motion-control darling of the video game console world, faces new challenges and questions about its future like never before. [pic] Images pic][pic]View Larger Image [pic] Bottom of Form • Realtors to release home sales index Tuesday 11. 30. 09 The industry-leading hardware has been the hottest gift three holiday seasons in a row since it was released in November 2006. This summer, the Wii topped 50 million consoles sold worldwide, making it the fast-selling console ever. But in recent months, sales have fallen off and holiday supplies are plentiful for the first time, removing some of the cachet of being a sold-out product. Some independent game publishers are restless as well, unhappy that they aren’t having the success on the platform that Nintendo’s games are.
Rivals Microsoft and Sony have both announced plans to add motion-control systems, which will appear next year, negating some of the innovation advantage that Nintendo has enjoyed. The question is whether the Wii can maintain its market lead or if it will fall back into the ranks of more traditional game systems, Microsoft’s Xbox 360 and Sony’s PlayStation 3. “The Wii … has passed a significant milestone in that supply has met demand,” said analyst Billy Pidgeon of Game Changer Research. “It’s not an issue that you can’t get a Wii. A lot of people … are eager to see what happens now. Nintendo executives dismiss concerns about the Wii platform, saying it has legs to compete for years. Sales of the console, however, dropped 43 percent from April to September this year, and are expected to fall far short of the 10 million units sold a year before. Nintendo has also revised its revenue forecast for the fiscal year ending March 31 from $20. 6 billion to $17 billion. Regaining lead Nintendo lost the title o