Cold-Flipper said:
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Einsam_Delphin said:
I'd think it'd always be worth it to take a loss if it means you make much more later than you lost initially, unless the loss now would cause you to go bankrupt, but that's not likely the case here. Since Nintendo isn't just going to vanish within a year, long-term is uber important, especially with how long this generation could last going by the previous one. Of course I'm no business major so perhaps there's more to it than that. What I do know for sure though, is that we don't even know how big a loss overall they'd be taking, if any. Let's just say that decide to $100 price cut around MK8's release. Let's also assume that by that time, Wii U is paying for itself. So with a $100 drop, I'd think it take 2 or 3 Wii U game sales to make a console profitable. Now with MK8, SM3DW, SLW, Wii Fit U, Pikmin 3, DKCTP, and many others having released already at this point, and oncoming titles like SSB4, Yoshi Yarn, SMT x FE, etc., plus the $100 drop increasing overall game sales, I think it's safe to say a favorable game to console ratio can be reached. Then of course there's the 3DS which should really be rocking by this point. So yeah they'll still be selling Wii U's at a loss, but overall I think they'd still be profitable.
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1st off, when a business drops the price of something it doesn't always mean they are now losing money on said product. They normally wait until they can still at least break even. (In Nintendo's case for sure)
The only way Wii U will get a $100 cut is if Nintendo feels that they have made enough money on Nintendo Land by the time May 2014 rolls around. If that happens they could go all the way because NL would become a free giveaway that they don't lose money on. Essentially, they would only be dropping the actual system by $60 or so instead then.
If not, I wouldn't expect them to do it.
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@bolded: Thank you, Cold-Flipper. You and zorg1000 actually understand this. It's like the thread creator just can't seem to wrap his head around this and continually points to the 3DS as an example, which is a fallacy.
The WiiU is already taking a loss. You can't just cut the price dramatically on top of that and hope for the best. Just ask Sony how well that worked out for them with the PS3. That console will never be able to make back the billions that it cost them and Nintendo is not about to follow that example.
