Per Sætan

It looks like this thread got way off topic, but I'll chime in on the original post anyway.

The Wii has sold more in its first year than any other system in history, but people are absolutely correct to point out that this trajectory has been clear for months now, and other more liberal companies may have taken the "risk," assumed they would continue selling extremely well (and the Wii has been), and begun ramping up even more production 6-7 months ago, just in case. That's a risk that Nintendo did not take, and it looks like they can and should have taken it now. My opinion: if the Wii is outsold by the Xbox360 in December in the US, then Nintendo made a mistake. If they are outsold by the PS3, then they totally blew it, I agree. Otherwise, there isn't any significant harm done here. 

 Your Opinion = My Opinion

Good day. 

graphical analysis!!

Wii sales projection in the form of a normal curve, from perspective of April 2007: Standard deviation is f'n high. Let's call it 5 million units. Average projection for LTD sales as of Dec. 31 2007, let's call that 17 million, because that's roughly where sales will be at year end, and I'll assume Nintendo went with the average projection.

Now, with normal distribution, about 63% of the total possibilities will be contained within one SD of the mean. That means that if Nintendo had gone with 20 million units (or increase production by 400K/month more than they did), they would only have had about 27-28% confidence that they'd actually sell that many (that's what the Z table says, at least).

When you think about it, though, 400K/month is a steep hike in production. I don't remember where they were at in April, but let's take current numbers and call it about a 22% increase. They'd have to get 20% more production than they already had. Now, keep in mind that a production increase from April wouldn't have taken effect until at least August, so instead of having 8 months, they've only got (let's be liberal) 5. That means they would *really* have to increase production by 600K/month.

How the hell you going to tell me they should have increased production by over half a million *per month* with less than 30% confidence it would work? That's a 33% increase in production, enacted over 3 months! In preparation for a holiday season that lasts a month and a half! As of January, they'd already need to scale back production to more reasonable levels, or be stuck warehousing those extra 600K/month cumulatively. Hell, even an error of 100K/month would start taking its toll by March, particularly for an inventory-low company like Nintendo.

When Hurricane Wilma hit South Florida, she tore off many roofs. In 2006, it was common to drive down the highway and see blue tarps where Spanish Tile should be. It took about a year before houses were more-or-less roofed. Many buildings had roofs with significant weaknesses for the entire duration of the 2006 hurricane season (good thing Florida only got one tropical storm that year). Who in their right mind would let something like this happen? How the hell could it take an entire year to get 100,000 roofs' worth of tile to South Florida?

Simple. nobody wanted to produce that many tiles.

Far more was at stake here than some piddling stock value, but obviously production channels weren't prepared to take the burden. It happens.

The Empirical Rule is ~68% for 1 SD =P

Bleh. I freely admit that I failed Stats II last year. I'm surprised I know what I stated above.

Now that we see the PS3 and 360 have both outsold the Wii two weeks before Christmas, I'll repeat my stance:

If the Wii is outsold by the 360 this December, then Nintendo made a mistake. If it's outsold by the PS3 as well, then Nintendo made a BIG mistake.  

Next week is the big Wii push supposedly. I'll wait until the new year to see what happened.

The Wii didn't get outsold by anything except the DS. In US it did (due to stores choosing to sell them on Sunday apparently), but not worldwide.

 We're talking about US here. Worldwide certainly matters, but it's significant that Nintendo is still behind the 360 in America, and is now falling farther behind. 

Some pundits predicted the Wii will cede all of the headway it has made against the 360 this year in the US. I don't think that's likely, but you can clearly see that it's losing SOME ground, and that isn't a good thing. As we always say, this is a game of momentum, with hardware sales building software sales building more hardware sales and so on. Whatever the reason, if the Wii continues to fall further behind the 360 in the busiest season of the year, then that is bad.