Here's how the meeting would go..
Sega: So we would like to talk about having an official Wii/The Conduit bundle for the games launch in early June
Nintendo: OK so what do you propose?
Sega: Basic Wii with The Conduit as a pack in title along with Wii Sports
Nintendo: OK so then your game would be getting a free ride and have to deal with little to no retail margins. Also as the Wii's sales are determined by supply, all of your games will be sold and you won't even need a marketing campaign to sell them. People would be confused as to why this game has joined Wii Sports as a pack in title.
Sega: The first thing is that we'll be pushing this game heavily from a marketing and retail standpoint. Secondly as we are aware that all of our stock will sell and that it won't have to deal with retail margins, we would like to price the bundle less than the Wii's $250 + The Conduit's $50 and increase the profit margins in your favour. We feel this would be a win-win situation.
Nintendo: So say we make a deal for 1 million Wii/Conduit bundles.. Each priced at $279.. That would mean that at the retail margins of 5% they would be taking $14 instead of $12.50 so you'd cover that plus increase our profits?
Sega: If we priced the bundle at $279 then from the extra $30 - We were looking at giving you an extra $5 so it would cover the $1.50 decrease and it would increase your profit for each Wii sold by $3.50. Multiply that by 1 million and this bundle would be profiting you an EXTRA $3.5 Million. Sega will then match that with advertising specifically for the bundle.
Now it sounds awesome and the way I've written it has Sega very aggresive in their argument - It also means that 1 million sales will come from people that don't own the Wii and that is increasing their sales even more as most sales will probably come from people who own the Wii already. I was attempting to disprove this but in the end I made it seem like a possibility :P
