DonFerrari on 06 September 2014
WagnerPaiva said:
greenmedic88 said:
Ultimately, it's all revenue for a company, regardless of where it's coming from based upon a company's business model.
For Nintendo, they don't sell hardware at or below cost, so every sale is profit earned. Of course their internally developed and published IPs are responsible for generating a significant portion of overall revenue and profit. Add merchandising to those IPs and they have a pretty healthy business model, even if it's not based upon high growth.
It's understood by all that the key advantage to producing and selling a proprietary gaming platform is to generate licensing revenue from developers, simply for the privilege of being able to publish on that platform, and this is the only real area in which Nintendo's business suffers from the standpoint of what they could be generating.
But Nintendo has always been the fiercest competitor on their own hardware platforms for third party developers and publishers, to the point where some developers who can't find a profitable sub-niche market within the Nintendo market choose to skip the Wii U altogether. It's not "lazy developers" or "anti-Nintendo bias," there are simply a lot of instances of publishers who have been unable to generate sufficient profit by releasing their games on Nintendo consoles relative to Sony or MS consoles to offset the added cost of developing and publishing on a riskier, lower potential yield platform.
So Nintendo has to get by with less 3rd party support and their business model should reflect that, leaving the market for their hardware smaller, but still profitable and still large enough for continued support.
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Makes sense. And I hope it is true, cause I am so in love with my WiiU.
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Don't worry... they made money on N64 and GC with small HW sales (ok most of the money come from GB), and if played right with most SW selling north of 3M (and they seem to have pretty smaller cost than AAA on PS4/X1) they will surely make money from WiiU... the last 3 years of small loss was reflex of realy small SW sales and HW cost still high... they probably will start to see profit this year forward.
