DS and PSP have peaked I believe. Nintendo can probably meet its 30m DS projection but thats down from last year.I don't think Sony will quite hit its 15m PSP projection, even with PSP Go, I think 13.5m is more likely than 15m - they did 14.1m last year.
PS2 had its first USA price cut in May 2002 which was only 20 months into its USA launch. We're 31 months into the time Wii has been on the market in the USA and Nintendo hasn't cut the Wii price. I do think we'll see a Wii price cut within a year - either this fall or in the spring - but they shipped 25.95m Wiis in one year at its original price point. If you do the math its the highest grossing year for a videogame machine by revenue ever....
DS FY 3/2009 ~$130 * 28m + $170 *3.2 ($4.18 billion)
Wii FY 3/2009 ~ $250 * 26m ($6.5 billion)
PS2 FY 3/2003 ~ **$205 * 22m ($4.61 billion)
** $300 until May 2002, production shipments
In the previous fiscal year, the March 2002 year Sony shipped 18.1m PS2s for $300 which is $5.4 billion in revenue. To me thats why Nintendo is hesitant to cut the Wii price.
There are probably three Wii pricing options
1) Keep Wii Price the same, rely on games
2) Cut Wii price $50 worldwide this FY
3) Cut Wii price $100 worldwide this FY
For option one I think they can do 23m-27m Wiis. Thats $250 * 25m in revenue, or $6.25 billion in Wii hw revenue.
Option two, they could probably do 26m to 32m Wiis. Thats $200 * 29m in revenue, or $5.8 billion in Wii hw revenue
Lastly, they could do option three. Probably 30m to 35m Wiis. Thats $150 * 32.5m in revenue, or $4.875 billion in Wii hw revenue
For option two, its conceivable that four million new owners brought in by the price drop would be an extra game for another $200m, then more controllers and accessories so it might be worth it...but its probably still best not to drop the price yet for Nintendo.
People are difficult to govern because they have too much knowledge.
When there are more laws, there are more criminals.
- Lao Tzu
