Why Wii still sale like hot cake??

[Avinash_Tyagi]

Wii has an advantage over the other consoles that is not effected by price.

First you have to understand that the hardware side of the gaming industry as a whole tends to exist in a state of differentiated Oligopoly/monopolistic competition, depending on how wide a net you use to define gaming hardware. However the key to this is the issue of vertical and horizontal differentiation.

Now in terms of vertical differentiation, basically the issue of which is superior to another, depends on the individual consumer, Wii's innovative control and inhouse software allows it to be viewed as superior to some over the PS3 and 360, while otehrs prefer the HD console, while others refer the PC, or handheld/mobile gaming, what have you. Taht is not as important however to this discussion as horizontal differentiation, which isn't an issue of superiority, but rather substitutability, can one replace the other and give the same results. Unlike the HD consoles which can easily replace one another, and even be replaced by the PC, the Wii cannot be easily replaced in what it offers, while the HD consoles have weak horizontal differentiation, they can be easily replaced, menaing price matters and has an effect. Wii has strong Horizontal differentiation, meaning it cannot be easily replaced and therefore is not effected by price as much