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Locked: Why the Wii Won't sell 80m+

Forums - Sales Discussion - Why the Wii Won't sell 80m+

@mrstickball hey man you can't write so long and good post how should I be able to qouto you? Now I think HappySquirrel actuly meant that you wont se the production increase during ordinary days because they are holding back supply for special game realises and so on. Then the 1.7 million I guess is actuly more for Guitar Hero 2 than anything else. More than that I wont discuse, good thread keep the idiots and troll out and this could end very well.



 

 

Buy it and pray to the gods of Sigs: Naznatips!

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Also, if anyone looked at the chart I put for discussion: The chart I gave is for the 4th through 7th Christmas + next January for the PS1, PS2, Xbox and N64. For the Wii, this would be 2009 through 2011. I made the chart to show how critical those years are. For the Wii, the issue is, that it *could* (and Im only saying could, not will, or won't) be the years that the Wii starts to lower in popularity, or a Wii 2 is launched. For the PS2, those 3 years were Dec 2003 through Jan 2006 - It sold MORE than 50% of it's LTD in that time period. For the PS1, those 3 years were Dec 1998 through Jan 2001 - It sold MORE than 50% of it's LTD in that time period. For the N64, those 3 years were Dec 1999 through Jan 2002 - It sold LESS than 30% of it's LTD in that time period. For the Xbox, those 3 years were Dec 2004 through Jan 2007 - It sold LESS than 30% of it's LTD in that time period. Whats the point of this? There is a 10 million unit gap between the PS1/2 and the N64/Xbox because of it's December #4 through January #7. There is an inherant relationship between a companies ability to both make and sell systems during that time period that either will make or break a company.



Back from the dead, I'm afraid.

Ohhh some one has some time to kill. Pretty optimistic. wiis hardware hdtv penetration future proofed competitiors are working agianst its sales.



I don't think Wii will sell over 65 million...but it could and here is why: No other system has ever had such a relative price advantage. Granted, the core model of 360 is $300, but I'm pretty sure Nintendo could drop the Wii to $150-175 and just about break even. If Microsoft doesn't want their business venture into gaming to become like Vietnam, they are not going to drop the price until they absolutely need to and can start winning back cash on their investment. But, Sony is even worse off. I don't think PS3 will be under $300 until late 2009. Imagine if by then, Nintendo was selling Wii and DS as a package for $150? I think that would be a huge 'steal' for even the biggest Nintendo detractors. In previous generations, Nintendo has not had this immense of a price advantage in conjunction with sales as brisk as they are. Because of the relative bargain, I think Nintendo will be able to sell around 1 million per month (on average) until at least the end of 2008, which gets them near 30 million. By the time Wii is 5 years old, graphics on 360 and PS3 will be dated and ancient as well (PC's). I also think the manufacturing isn't a problem because much of the tech in Wii is so similar to GC. DS has pretty unique architecture and needing two screens is a bottleneck. I don't think Wii has the same kind of bottlenecks when it is manufactured. It also seems to me that Japanese developers are becoming less important to Western audiences, so if Nintendo dominates Japan, the big Japanese third parties will eventually put most of their resources on Wii to reach the home audience. In the end I see the split like this: Console Worldwide sales Japan sales Americas Sales Others sales Wii 60-70 million 25 million 22 million 18 million PS3 35-45 million 8 million 18 million 14 million 360 43-48 million .75 million 27 million 16 million Edit: BTW Stickball - how much do you have Wii selling?



People are difficult to govern because they have too much knowledge.

When there are more laws, there are more criminals.

- Lao Tzu

mrstickball said: Truth is, 3-5% of systems fail. Even if 10% of the PS1/2s failed (2-3x the typical rate) during the first year, that'd only help the PS1's numbers by *maybe* 500,000 units during its first year, and the PS2 by around 2 million (remember, the PS2 only launched in Japan for the first 8 months before it came to the US, and by then, the correct console revision was nearly done)
Don't get me wrong, I wasn't saying that there were only 2 PS2 systems purchased 50,000,000 times each but 3% to 5% of systems breaking in the lifetime of a system is amazingly optimistic; 3% to 5% of systems breaking per year is probably a far more realistic number meaning that 100,000,000 PS2 systems would represent 60,000,000 to 75,000,000 unique purchases.
mrstickball said: Exactly how can Nintendo magically increase their production capacities by 400% for only 1-2 months? These factories are already running nearly 24/7. They would have to somehow either buy/aquire factories for just a month or two, which is not financially feasable. Again, as I stated, this is why companies lower their Q3 and even Q2 shipments to prepare for the mass sales in the holidays.
Its called a warehouse: Definition:a building, or a part of one, for the storage of goods, merchandise, etc. The fact is that if the Wii continues to sell at the rate it is Nintendo will continue to increas production as needed, will buy/rent warehouse space and most retailers would be happy to take on additional stock in order to ensure they have a steady supply. Technically speaking Nintendo has the resources to aquire extra manufacturing capacity but are (probably) not rushing to 2.5 or 3 Million units per month because they don't want to overshoot demand. I could be wrong but I suspect why it has taken so long to get production increased is because Nintendo wants to ensure that they will be able to ramp up production faster in the future (if needed). I think you believe that Nintendo buys and owns the plants where the manufacturing and that it is impossible for them to add facilities; generally speaking this isn't how things have worked for a very long time. There are gigantic manufacturing firms around the world which are capable to do intermediate or final assembly of the Wii; to increase production Nintendo gets their suppliers to increase production, these components end up being assembled into other components (if necessary) which are then completed at the final assembly plants. It is really not that hard except that it takes a little time for a company to find a manufacturing firm which can meet their quality requirements.



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Hus said: Ohhh some one has some time to kill. Pretty optimistic. wiis hardware hdtv penetration future proofed competitiors are working agianst its sales.
Allow me to fix that for you: Fast Selling Wii hardware Low HDTV penetration Slow Selling and Expensive future proofed competitors



TheSource said: I don't think Wii will sell over 65 million...but it could and here is why: No other system has ever had such a relative price advantage. Granted, the core model of 360 is $300, but I'm pretty sure Nintendo could drop the Wii to $150-175 and just about break even. If Microsoft doesn't want their business venture into gaming to become like Vietnam, they are not going to drop the price until they absolutely need to and can start winning back cash on their investment. But, Sony is even worse off. I don't think PS3 will be under $300 until late 2009. Imagine if by then, Nintendo was selling Wii and DS as a package for $150? I think that would be a huge 'steal' for even the biggest Nintendo detractors. In previous generations, Nintendo has not had this immense of a price advantage in conjunction with sales as brisk as they are. Because of the relative bargain, I think Nintendo will be able to sell around 1 million per month (on average) until at least the end of 2008, which gets them near 30 million. By the time Wii is 5 years old, graphics on 360 and PS3 will be dated and ancient as well (PC's). I also think the manufacturing isn't a problem because much of the tech in Wii is so similar to GC. DS has pretty unique architecture and needing two screens is a bottleneck. I don't think Wii has the same kind of bottlenecks when it is manufactured. It also seems to me that Japanese developers are becoming less important to Western audiences, so if Nintendo dominates Japan, the big Japanese third parties will eventually most of their resources on Wii to reach the home audience.
As much as price is a factor, at the same time, it's not if the software and appearance of the system are less than satisfactory. A good example is the N64/GC versus the Saturn, PS1, PS2, and Xbox. The GC launched at $200 versus the PS2's $300 and the Xbox's $300 and ended up in last place. The N64 launched at $200 versus the PS1's $300 and Saturns $300 and ended up 2nd place. Now, there's never been as big of a gap (in the fact that the prem 360 sells the bulk of the systems @ $400), but again, it's an advantage, yet not the primary reason the Wii sells out. The big issue is the fact that Nintendo HAS to sell the Wii at a significant profit to stay afloat. The PS3/360 does not (although they have to at some point). The GC is still around $100 (where I live, mind you), while the PS2 is $129. 2 years from now, the Wii could easily be going @ $150 or less. But at the same time, it'd be just as easy for a core 360 to be @ the same price. Remember, a $100 price drop on the 360 core (which actually happened in December thanks to $100 gift cards) puts it at $200: $50 less than a Wii. I'm not saying that Nintendo would allow a 360 Core to be cheaper in the US or Europe than a Wii, but it's do-able by MS if they wanted to.



Back from the dead, I'm afraid.

Squirrel - I understand that Nintendo can easily get warehouses to hold Wiis in, as they do that with DSes. Here's my issue: The Wii is selling right now @ 1.0m units per month (give or take). Nintendo will increase their abilities to 1.1m or 1.2m in April and stay at that. Now, the question is, how are they going to increase SUPPLY in the holiday months? They won't buy/purchase/aquire more factories (atleast at a very large #), but they will do like you said: store Wii units. The issue with that is it lowers the 1.2m "average" which is exactly that, an average, and that's what I meant it as. I believe Nintendo might sell 1.0m units a month from now till October (on average), and stockpile the extra 200,000 units each month to then give them an extra 1.6m units for the holidays. Again, my number of 1.2m a month for the next 12 months is just an average based on maximum possible sellthrough + the fact that Nintendo will decrease their supply to retailers in the months preceeding November-December, as every company does. Example in Japan: Nintendo right now is holding units back for Golden Week. Nintendo isn't (atleast I hope they aren't) lowering supply, as we've seen for the past month that sales have been dwindling (from 70-85k units a week to as low as 45k to 65k). Is this because the Wii is selling bad? NO! Of course not. It's due to Wii putting those units back somewhere for Golden Week. Again, thats why I just had averages, as Nintendo is averaging 1.0m units right now (and averaged about 500k when the Wii actually started production in June-July for the November launch).



Back from the dead, I'm afraid.

I bought my Nintendo 64 for $250 in 1996. I had to shovel 50 driveways during Dec 1996 at $5 each to get it...but my question is.. Was N64 really launched at $200? I'm pretty sure it was officially $250, or effectively $250 when retailers/Nintendo saw the demand - by the time it launched I think both PS1 and Saturn were less money. My main point on the price is that it will sell better than GC or N64 did because when Wii is as old as GC is right now, I think it could be $50-$80. BTW - How many consoles do you think Nintendo, Microsoft and Sony will sell this generation?



People are difficult to govern because they have too much knowledge.

When there are more laws, there are more criminals.

- Lao Tzu

Again, my figures that I've placed since April 2006: Playstation 3 - 70~75m (most likely around 72 or 73m) - Why? I don't believe that Sony can afford to release a PS4 until no earlier than 2013 due to development costs. That puts the PS3 at around 10.5m units sellthrough per year (averaged) until 2013. Not very high, but respectible. Certainly not as fast as the Wii Xbox 360 - 52.5m~57.5m (most likely around 54m-ish) - Why? It had a year advantage, and will pay off. Sales are increasing in Japan to give it around 2m or even 3m units by the end of it's life, and will easily win in the US. Europe/Other will increase over what the 1st Xbox did. Again, same reason it beats the wii: Longevity. I think MS will release the next system in 2011 or 2012 which gives it a life of 6.0+ years (give or take), or around 9m units sold per year. Wii - 47.5m~55m - Why? The Wii will be the fastest selling, certainly, but I seriously believe the reason Nintendo put out such a cheap console was because they didn't want to risk the money associated with a powerful system. The past 2 power-hungry Nintendo systems failed, costing Nintendo lots of extra R&D dollars. Now that Nintendo has a solidified winner, they will quickly replace the system in mid-2010, cutting off it's ability to beat the PS3. This means a 4.5 year lifespan, or around 12m units per year....A higher rate than the PS3 or 360 by a decent margin. I certainly believe that the Wii2 will be a FAR better selling system due to improved graphics (atleast enough to compete an extra year vs. the next generation systems). This is not a knock on Nintendo, or trying to be anti-Nintendo. It's obvious it'll sell the fastest and be the most profitable, but will die the quickest too. I also believe Nintendo will be able to transition the 2 systems VERY well and consumers won't notice, but I will. The issue I find is this: Many people that are analyzing the console race are thinking that the entire console WAR is summed up in the next 5 years. It's not. This generation is just one battle in the war. People are also too obsessed with numbers for the PS3/Wii/360. Just because I think the PS3 will sell the most for the generation means absolutely nothing if Nintendo makes billions of dollars and Sony loses billions of dollars. Does it matter if the PS3 sells the most units to Nintendo? No. If Nintendo is making $100 per system and sells 40-50m of those systems, thats $40 BILLION dollars in hardware PROFIT. Thats an ungodly amount of money. Nintendo, like Sony wants MONEY. PROFIT. The console sales don't matter, the money does. Every time Nintendo and Sony make a system sale, Sony loses, Nintendo gains. Only fanboys gain some sort of hapiness associated with system sales, when the fact is that Nintendo has already won in the fact they are making far more money than Sony and their buddies. MS will also profit, as they will have a huge percentage in the console market, and like Nintendo, is trying to make money via Live, which is their "secret weapon" in making money - MS is a software and online driven company, thats where they make their money. They have 2-4 million gold members right now, and will have far more. Imagine 20m gold users @ $4 a month......Thats 80 million dollars a month for MS....That has nothing to do with MS points sales, hardware sales or game sales.



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