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CNET: Uh oh: Nintendo sold 57,000 Wii U units in the U.S. in January
News reported by 
Contributor
February 15, 2013, 17:25:31
 
Source: Link.

To put that figure into comparison, during the same period in its lifecycle, Nintendo's Wii hit 435,000 unit sales.

Nintendo's Wii U had a rough January, CNET has learned.

Nintendo sold only 57,000 Wii U units in the U.S. in January, a person familiar with NPD's game industry sales data has confirmed to CNET. The leading console maker during the period, Microsoft, sold 281,000 units in January.

Gamasutra was first to report that Wii U sales were sluggish in January. That publication's source said only that January sales were "well under" 100,000 units.

The Wii U's trouble in January stands in stark contrast to its predecessor, the Wii. In its first January on store shelves in 2007, Nintendo sold 435,000 console units.

That Nintendo is having trouble selling Wii U units is nothing new. The company's CEO Satoru Iwata last month characterized Wii U sales as "not bad." That came just days before Microsoft and Nintendo announced their console unit sales in December. During that period, Microsoft sold nearly one million more consoles.

The Wii U's troubles negatively affected Nintendo's earnings for the nine-month period ended December 31. The company said that it sold only 3 million Wii U units since its launch in November, adding that upcoming games, including new entries in the Legend of Zelda franchise, could "help Nintendo regain momentum for Wii U."

Still, that a console that has been on store shelves for just three months is selling so few units is shocking. It's something that gamers would expect from unknown game companies, but that it's a Nintendo issue, especially given its recent successes, is surprising.

CNET has contacted Nintendo for comment. We will update this story when we have more information.


Those numbers, assuming they're accurate, are appallingly bad. They're not DOOOOOOOOOOOMED bad, but they're objectively troubling as opposed to just tepid. Nintendo is going to need to take action more drastic than awesome Nintendo Directs, and Iwata needs to update his resume. If they have to price drop systems on short notice back to back, he should be out on his ass.

EDIT - assuming I'm remembering things right and the data I saw is accurate, the PS3 never had a month that bad at $600. So this isn't just rough, it's legitimately bad.

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Posted: 02/15/13, 17:25:31  - Edited by 
 on: 02/15/13, 17:40:45    
 
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@anon_mastermind

We know what's in it, though. Not counting R&D and all that stuff, the guts don't cost anywhere $150.

I'm not saying I don't think there's value in what you're getting in the Wii U; I didn't think I'd have one anywhere near launch, but I bought one and really like it. I'm really excited about software possibilities. And I don't think it's a stretch to say there's more in the box than standard SKU PS3 or 360 at this point, that seems pretty obvious.

That said I don't think the tablet is doing/has anything advanced or even remarkable from a hardware perspective... at all.


Posted by 
 on: 02/15/13, 23:00:19
Well, whether its guts cost $150 or not, a big piece of the MSRP on a Wii U is going towards that controller. Why else would Nintendo be selling it at a loss? PS3/360 tech + Wii tech cannot cost much more than $200 in 2013...

Edit: the "streaming" tech is I guess what is incurring that cost. I don't know if it shouldbe associated to the gamepad or the console itself. Cuz you need the gamepad to stream stuff.


Posted by 
 on: 02/15/13, 23:09:51  - Edited by 
 on: 02/15/13, 23:10:57
Kal-El814 said:
That said I don't think the tablet is doing/has anything advanced or even remarkable from a hardware perspective... at all.

That's kind of the beauty of Nintendo though, their brilliance is so seamless that it's not even obvious... until someone else tries to imitate it and fails hard.

I wonder if we will see 3rd party GamePad controllers? I have to imagine they would all be pure trash next to the original.


Posted by 
 on: 02/15/13, 23:49:27
@anon_mastermind
The WUG's most expensive component must surely be the screen, and it's a relatively lo-res, single touch unit, I'm the sure the money saved by not including a hard drive more than offsets the cost of the screen. Also, I doubt it's really worth $150, that's $50 less than a Nexus 7, with it's own processor, and a 1280x800 IPS multi-touch display, plus 16GB of storage, a Tegra 3 processor, and a gig of RAM.

Not that Nintendo is in direct competition with the Nexus 7 or the iPad, but it will be in direct competition with the PS4 and the next Xbox. As a consumer, why buy a Wii U now, knowing that it will out-classed in less than a year, and will probably not be able to play next-gen games? (EA and others have said as much)

To me this has always been the fundamental mistake and why Wii U is selling poorly and people seem to not care about it. Wii U is underpowered, it's stuck in some netherworld between this gen and next and hence it doesn't belong to either. If others disagree with me and think that specs don't matter and that as soon as Nintendo launches a few new Mario, Zelda, and Metroid games things will turn around, then I can respect that, and I hope you're right, because I don't want to be the Wii U to be the next PS Vita.

@Zero
Is video streaming really that big of a deal? I'm sure Nintendo spent a lot on the R&D to reduce latency etc., but even the PSP could stream video form the PS3, years ago, and Apple TV will stream any video signal from any apple device to an HDTV. Considering Apple TV is a mini-computer with it's own processor and RAM and cost $99, I can't imagine the chip inside it that enables video streaming over wi-fi (or however it works) cost very much considering Apple always sells their hardware at a premium.


Posted by 
 on: 02/16/13, 00:01:29  - Edited by 
 on: 02/16/13, 00:07:24
lol, I was just talking about this. I think the difference between $300 and $350 was a big deal. $350 was the most cynical price anyone was predicting and when it was announced it was something everyone felt they had to get over somehow. Like 'it's ok, I'll get the $50 back from the deluxe promotion' or whatever. It made everyone ask what made it worth so much and gave it the stigma that you had to be a big nintendo fan to buy one.

I call hindsight BS on 'it has no games' If it was selling well everyone would be like 'as expected, NL and NSMBU are big sellers.' Their selling power are getting nerfed by the high price.


Posted by 
 on: 02/16/13, 00:17:54
@deathly_hallows I dunno but my PS3 streams video from my laptop and it's assy. How difficult is it to get Wii U level tech streaming to the controller without any noticeable lag? Probably decently difficult.

@Renjaku It has games, but the question is more does it have games that will make PS3 / 360 owners want one?


Posted by 
 on: 02/16/13, 00:21:50  - Edited by 
 on: 02/16/13, 00:25:25
@Zero
I did it a few times, from my PS3 to PSP, and it was fine, not nearly as seamless and high quality as Wii U but it worked okay. The thing is, I only did it as a novelty because I could, I never really used it. The video streaming on Wii U is a neat feature, but if that's the bulk of the expense of the console, or even a significant chunk, then I think Nintendo made a tactical error and that money would have been better spent on improving the graphics and making it more compatible with future 3rd Party software, and maybe coming up with a better, cheaper innovative feature to differentiate themselves from the competition and draw in the casuals. Something more akin to the Wiimote, which was genius but didn't break the bank.


Posted by 
 on: 02/16/13, 00:37:49  - Edited by 
 on: 02/16/13, 00:39:08
@anon_mastermind

I guess I don't understand what's that impressive about the streaming tech? I push content from my phone or tablet to other display sources without lag pretty regularly. I'll wirelessly project content from my work PC to a projector or TV and control it with a wireless input device without lag. There are wireless HDMI adapters out there now suitable for gaming without input lag at this point, too. I love off-screen play, I just don't see how the Wablet is different than other devices that accept content that something else is processing without lag?

I'm not trying to be obtuse, I feel like I'm missing something that's incredibly obvious to everyone else. But I know plenty of devices that push wireless content and respond to external input without lag. What am I not seeing?

@Zero

I don't disagree generally, but I don't think the Wablet is doing anything remarkable as it pertains to streaming.


Posted by 
 on: 02/16/13, 00:44:10  - Edited by 
 on: 02/16/13, 00:45:44
Well I don't know I mean, what are we really comparing this tech to? Apparently PS3 / PSP streaming tech has some lag issues. What else do we know of that takes a real-time input, sends it to a processor, and then streams the result of that back to a viewing device without noticeable lag? Video streaming isn't the same thing, because it can just buffer the video (and yet the PC to PS3 video streaming still leaves much to be desired.) Gaming though is real-time input-dependent, and I don't know that anything else of the scope and effectiveness of the Wii U exists.

I'm not saying it's the most amazing thing ever, but I don't think that it can be written off either. There were so many ways that this could have been crappy, but it's not. It works great.


Posted by 
 on: 02/16/13, 01:10:49  - Edited by 
 on: 02/16/13, 01:11:04
Not sure if this helps shed any light, but here is a link about the streaming tech:
The surprising (mundane) tech behind the Wii U's magical GamePad

And here are some pics of the actual unit, apparently part of a dual-antenna wireless array built by Broadcom.






I wasn't able to find a breakdown for how much the custom wi-fi chip cost, but I the wireless chip in an iPhone 5 (wi-fi, BT, GPS) purportedly cost $4, considering this is specialized hardware... what do you think, $6, $8? Seems like the bulk of the money would have been spent on the R&D side developing the software to stabilize the stream and get rid of lag.


Posted by 
 on: 02/16/13, 01:12:35  - Edited by 
 on: 02/16/13, 01:15:06
@deathly_hallows Focusing on just the chip while ignoring the custom software development is pointless though. If we could do that, every video game should cost what... $2 for the disk it was printed on? At my job we just talked to Canon today about licensing some of their scanner software. They want to charge us about $5,000 for their server software and $400 for each instance of their desktop application. That's not even counting any of the hardware yet. Software developers need paychecks too.

Anyway, that's kind of getting into a whole other area there.

Whatever the case, what we know is that with the Wii U Nintendo is losing money on each unit produced, and this was not the case with the Wii. No matter how much you try to break down the components, if you don't end up at around $300 for the final product, you're missing something. The fact is that it is costing Nintendo more to make these things than they are selling them for. You can say they went in the wrong direction and that's fine as your opinion, but you can't reasonably say that they cheaped out on tech.


Posted by 
 on: 02/16/13, 01:23:02
Bad news for sales figures. A few things I think need mentioning though...

1) Outside of the Wii, I don't think this is uncommon for Nintendo. Both the DS and 3DS had pretty rough post-launch droughts, with the 3DS in particular getting off to an extremely rocky start. If they can bounce back from the 3DS, which had the worst Nintendo launch ever, and a sudden repricing a couple months later, they should be able to handle weak market appeal in January for the Wii U.

2) I'm not really sure I agree with the "no games" thing. Honestly, I think the Wii U's launch was actually rather strong. Yeah, there were a number of older ports, but several of those were still very good, and games that were either new or revised for the Wii U itself (Ninja Gaiden 3, Sonic Racing, Scribblenauts, ZombiU) were actually pretty solid overall. Nintendo's own offerings--NSMBU and my favorite Wii U game, Nintendo Land--were much more content-rich and polished than any of their three 3DS launch games by a large margin.

The issue is a dry January and February...that's why this Rayman debacle really stings.

On the plus side, we might be seeing another sort of Ambassador bonus for us early adopters. How about 10 free GCN and DS games?


Posted by 
 on: 02/16/13, 01:36:32
@Zero
I'm sure that Nintendo is factoring in the cost of R&D, shipping, packaging, licensing fees, marketing, etc. when they say they are losing money, but that's almost always the case when launching a new product or starting a new business venture. Imagine if you opened a new restaurant, you'd have to pay for the architect to come in and design the space, the contractors to build it, the materials and appliances, the taxes and licenses, the cost of the hiring a staff, developing a menu, buying the food, etc. Those are legitimate expenses that as a business owner you need to recoup in order to make a profit, but the answer isn't charging $50 for a burger, if you do that you're going to have a hard time convincing people to come to your restaurant. You may have to charge only $12 for a burger, even if the actual ingredients cost $10, you're barely making any money at all, but you need people to come into your restaurant, and tell their friends, so more people will come, and eventually, over a long period of time, if you make damn good food at a reasonable price that people are willing to pay, then you'll start to make your money back.

Heaven help you if Microsoft opens up a restaurant next door and they charge $15 for their burger, but it's 100% grass-fed Kobe beef and it comes with fries, a salad, and a beer.


Posted by 
 on: 02/16/13, 01:38:17  - Edited by 
 on: 02/16/13, 01:42:09
Staying on top in the console race seems to be a very difficult task. I think this upcoming generation is going to be pretty amazing, not because of Sony, Microsoft and Nintendo but because some very serious new players will be entering the market. Namely Apple and Valve. As soon as Apple releases a device that can stream Apps directly to a TV, that can be interacted with via a traditional controller or an iPad/iPhone, it's going to be a big deal. Android also has similar projects in the works. Rumor has it Valve is making their hardware open source for anyone to release... which has never, ever been tried in the console industry, it's a strictly PC concept.

Who knows how it pans out, but it's going to be interesting. I think all 3 console manufacturers could run into difficulty. Especially if Sony and Microsoft opt towards draconian DRM policies, outdated price models and locked consoles while Valve and Google and Apple come in and do the exact opposite.

Honestly though Nintendo seems to be in pretty rough shape. The 360 came out before the original Wii and the Wii's successor is getting outsold 8:1 by 8 year old hardware. That's not good. Hopefully when they release some major games things pick up however with so many 3rd parties already jumping ship Nintendo may be on their own to support the console by the end of next year, right when the generation is starting to heat up. Not a very good situation to be in. I'm now definitely waiting until the competition comes out with their consoles to get a Wii U, I have a feeling drastic price cuts will be happening by Christmas time.


Posted by 
 on: 02/16/13, 01:42:40
Horrible news. I'm somewhat pessimistic about the Wii U's prospects and this was worse than even I expected. Terrible.

I'll say this: If Nintendo is losing money on the Wii U, it doesn't show in the final product. You guys can come at this from any logical angle you want, dissecting components or whatnot, but I say the Wii U just doesn't feel like a big leap forward in technology. Maybe that's selling it short from a technical perspective, and maybe, like the 360, the power will come to bear with time. I hope it does. Good lord, I hope it does. But if you want to explain why there's no big hunger for the Wii U right now, that's why. It feels like a stop gap. It feels like something other devices can match. Discussing R&D budgets and where the costs all come from down to the dollar is kind of secondary.

What could Nintendo have done to combat that perception? Nintendo needed one game that looked like Watch Dogs. And they don't have it.

And I think lack of games is absolutely the root cause. (Well, and the stink of the last few years of the Wii, which I think is a much, much bigger factor than a lot of people around here seem to believe.) There was never, ever a tent pole game - something that was obvious at E3 last year and why it put so many of us in a sour mood. What we got, instead, was a modest wave of ok-to-good games and some 3rd party ports that were only good for people like Stache who never bought a competing console last gen. There was no Wii Sports. There was no Halo. There was no Mario 64. And I think that is the main problem, right now.

And, yeah, I think Nintendo should have seen this coming. They set the release schedules. They are the ones who released close to nothing on the Wii the last two years. What were they doing with all their resources during that time? Because there was no way in Hades that New Super Mario Bros U, ZombiU or even Pikmin 3 was going to move units like Wii Sports did. (And Nintendo Land might have been a bigger player if it didn't look like someone barfed rainbow sherbet all over it.)

Where's the system seller, Nintendo? That's the big question.


Posted by 
 on: 02/16/13, 01:46:40
@kriswright


Nintendo doesn't need a game that looks like Watch Dogs. They needed Mario Kart with fully integrated online support.

Honestly the Wii U launch line up was horrible. There were pretty good games but nearly everything that came out could be had elsewhere for cheaper and the differences by all accounts are marginal. Why spend $350 to play any of those games? They needed something like a brand new Mario Kart or Zelda or something of that caliber for launch.

I mean imagine if the N64 didn't launch with WaveRace 64, Pilot Wings 64 or Mario 64 and instead had a bunch of PSone ports that were six months old for twice the cost.


Posted by 
 on: 02/16/13, 01:51:52
Oldmanwinter said:
I mean imagine if the N64 didn't launch with WaveRace 64, Pilot Wings 64 or Mario 64 and instead had a bunch of PSone ports that were six months old for twice the cost.
Oh man, Super Mario 64... I just don't think it's reasonable to expect something that earth-shatteringly awesome, after all that was the jump from sprites to polygons. No system will ever have a launch game like that again, not until we have holographic displays or something. Still, I know what you mean.


Posted by 
 on: 02/16/13, 01:58:51
deathly_hallows said:
Oldmanwinter said:
I mean imagine if the N64 didn't launch with WaveRace 64, Pilot Wings 64 or Mario 64 and instead had a bunch of PSone ports that were six months old for twice the cost.
Oh man, Super Mario 64... I just don't think it's reasonable to expect something that earth-shatteringly awesome, after all that was the jump from sprites to polygons. No system will ever have a launch game like that again, not until we have holographic displays or something. Still, I know what you mean.


I'll put it like this. If the console launched with Pikmin 3... which is about 1/1000th as popular with the masses as a Mario Kart or Zelda game, I'd own a Wii U. For someone like me I would have basically been paying over $400 to play a new 2D side scrolling Mario or Zombie U. It's not going to happen. I'm sure there are millions of others like me. I'll be buying the console at some point however what sucks for Nintendo is they would have got me at full price. Now I can read the writing on the wall. The Wii U is going to be forced into massive price cuts by next Christmas, or whenever the competition launches. So I'll wait until then.


Posted by 
 on: 02/16/13, 02:05:10
I'm looking forward to seeing how a desperate Nintendo is going to act... they going to play it safe or are they going to make some bold and interesting moves? Is it going to bring out the perfectionists that release software like Mario 64, OoT, Metroid Prime or the "Oh shit!" company that rushes out games before they are done like Super Mario Sunshine and Wind Waker?


Posted by 
 on: 02/16/13, 02:14:23
@deathly_hallows But is Nintendo really charging that much more for its console production costs to consumer cost than the competition? I know Microsoft came into the game with huge losses to get a footing, but how much does the 360 cost to make versus its price right now? The PS3? I'd imagine they're all right around the break even point.

@kriswright It doesn't feel like a huge leap forward in tech because it's not... in the raw power. I'm sure a big part of the cost is simply the controller.

It's going to be interesting to see how much they sell that controller for standalone in NA once that comes about. I'm betting $100 or so.


Posted by 
 on: 02/16/13, 02:37:15
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