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Soundwave said:

I think the other thing people don't get especially with modern platforms is "consumer who buys the next-gen version of console instead of older version =/= a lost sale". 

Some people may not like it, but I'm pretty sure if they could have, Nintendo gladly would've traded 15-20 million off the DS userbase to give to the 3DS (so DS with 135 million LTD, 3DS finishing with 95 million LTD and in particular having more users early in the product cycle). 

That's not a net loss for Nintendo business wise. 

I think Sony is basically doing exactly this with the PS4/PS5 transition ... they are basically forcing late gen PS4 buyers to have to adopt the PS5, which can function as a PS4 also. But they still are leveraging the PS4's 120 million userbase with cross-gen titles, so basically they are having their cake and eating it too. They're not abandoning the PS4's install base (well at least through the first two years of the PS5's life cycle) *for software*, but they're also not so subtly pushing anyone who wants in on the Playstation *hardware* ecosystem to have to buy a PS5 by basically stopping PS4 production. 

Ultimately I think that strategy is smart. The PS5 really hasn't had the greatest library of exclusives at all early on and has had availability problems too, but Sony has sold basically every unit they can make, I think in part that is due to the PS5 basically being the only system they will ship in large quantities and refusing to do the whole "well lets cut the PS4 price and let budget shoppers buy that one and let it hang around". 

The other reason this can work now I think is because the whole "budget console" concept seems to have gone in the crapper. Sony refusing to drop the PS4 below $300 and having a $400 PS4 Pro meant the consumer for it could still be in play for a PS5. Nintendo refusing to drop the price of the Switch and even increasing the price for the OLED model at $350 means they probably could very easily entice a lot of those consumers who are willing to pay $350 for a Switch OLED to buy a Switch 2 at $399.99 instead ... why not, $50 more for a generational leap, I'm sure lots of people will gladly take that. It would be different if the Switch was like $199.99 or less and they were trying to convince that consumer to spend double that for a new system. That's a big difference with how hardware is sold today from previous console generations. Shifting people who were willing to pay $400 for a PS4 Pro or $350 for a Switch OLED into being early adopters for the next product cycle instead is entirely feasible. Even $300 ... if you're willing to drop that much for hardware this late in the product cycle, odds are you can be convinced to spend more to get the next-gen system instead because at $300 you're not really a budget shopper to begin with. 

Cross-gen games are possible for the Switch 2, but not certain. Cross-gen games have been a thing for a long time with third parties, and has been commonplace since the Gen 6-to-Gen 7 transition (FIFA 14 having the distinction of being the only game released simultaneously across three generations), but was until recently a rarity for first-party games. Sony & MS didn't really get into it until this generation, but I think the unusual circumstances at that particular generational transition (big Gen 8 install base, plus supply chain issues causing shortages of Gen 9 consoles and rapid discontinuation of Gen 8 consoles) made it a necessity. Nintendo has only had two cross-gen games that I'm aware of, both times on systems with similar levels of power (Twilight Princess on GC & Wii, Breath of the Wild on Wii U & Switch).

However, I do think the Switch 2 will most likely be backwards compatible. Unless Nintendo wants to spend a lot of money porting a bunch of Switch games to a new system that will almost certainly have the same form function (hybrid console using small cartridges), it's most likely the Switch 2 can play Switch games. This would mean that early adopters still have those last-gen games to play on their new system. Considering a relatively solid release schedule (TOTK, Pikmin 4, and Super Mario Wonder) in what is likely to be the Switch's last year and the likelihood of not many mega-blockbuster-tier titles early in the Switch 2's first year due to so many popular series having just had games released in the past year or so, making sure people have a lot of games to play on their new system is important. Also, early adopters could still buy late-era Switch games they haven't gotten around to buying yet and play them on their shiny new console. I know I've routinely availed myself of backwards compatibility on every system I've owned that's had it (the PS2, 360, Wii, Wii U, PS5, & Series X), especially early on when I didn't have many games for the newer system. If the Switch 2 is indeed backwards compatible, I may even just sell my launch model Switch to recoup my costs, just as I sold my Xbox One X to help pay for my Series X.

Also, agreed on budget models of consoles. Not just the Switch, but several other systems throughout the years (the 360, 3DS, PS5, & XBS come to mind) have all shown that a low price isn't everything, and that people will willingly pay more for a premium experience, with the most expensive SKUs of those systems being the most in-demand ones.

To address the Switch specifically, it has three distinct models on the market, so that gives us a great example of people's buying habits when having to choose between multiple models. The Lite was $100 cheaper than the OG Switch, but it was definitely a "you get what you pay for" deal, i.e., smaller screen, less battery life, no dock (and therefore no TV play), and no detachable Joy-cons. Outside of its launch month, it was consistently outsold by the OG model. The OLED is $50 more than the OG model, but most new adopters are clearly willing to pay that premium for a better device as it's been by far the most popular model since its release.

Wyrdness said:

Yet non of you have specified why any investor would suggest a quicker release dat you're only saying investors are a factor and the the irony is I know from when I used to work in finance that they'd do the opposite of what a few of you are saying as the sales are even beating out the PS5 in some weeks it's not as good a point as you think it is as those sales along with the online subs are raking in a ton of money which non of them will suggest to cut off. Fact is the current market situation allows them to wait.

"Well, our revenues are projected to be down massively and total unit sales down to near-record lows next year if we don't release our new system, but on the upside we pulled back ahead of the PS5 for a couple of months" is not exactly something a businessman would say, nor something an investor would like to hear.

Nintendo isn't competing directly with Sony & MS. They've been doing their own thing for 17 years across three generations. The market situation is that "The Switch is well past its peak and continuing to decline, and our business will suffer continued losses in sales the longer we wait to release a new system." Revenues are down, profits are down, and it's because they're at a generational transition. They will not delay the Switch 2 any longer than necessary. If it's ready to go next year, it will release next year.

Last edited by Shadow1980 - on 11 July 2023

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