Now I can agree with you.

Yes, Nintendo is in a win/lose situation, but they have almost always been in that situation as consoles and videogames are their business. Sometimes they win (NES, SNES, Wii, all handhelds until now), sometimes they lose (N64) and sometimes they not only lose but they also get hurt (GC).

How WiiU will perform is an unknown as there are still many unanswered questions (price, actual support from 3rd parties, the other consoles, etc), but even if they lose, it's unlikely that they will sell less than 30 milion units, which is enough to warrant a profit, from their own games, from 3rd party games and the hardware.

And the success of the 3DS (which wiill not sell as well as the DS, but it will do well) really depends on what Sony does with the Vita. Honestly, if Sony doesn't cut the price before Christmas it will be very difficult for them to change the situation, even more now with the larger 3DS (which with its higher price may be sold at a profit from the get go), and that means more software for the 3DS.

Oh, and yes, at the end of the next gen things will be different.

This is actually what I was thinking about with the Gamecube, I don't think 30 million is enough for Nintendo to be profitable,  even if the Gamecube broke even for Nintendo, the Gameboy and the DS is what made Nintendo profitable.  Nintendo's situation is one where the 3DS's loses can't be absorbed.  The Wii and DS haven't been able to make Nintendo break even and a new console is going to bring them even more losses (That loss being the nature of releasing new hardware, even Sony lost money on the PS2's first year).  I personally don't think there's much of a market for dedicated gaming devices anymore, which is why I think Sony bought Gaikai, and why Microsoft is delaying their next sucessor.  They both know the dedicated game market is a failing market so they're quietly making their exits and evolving their brands into something else to compete with Apple and Google.  And in Sony's case, joining Google.

Now I have to disagree with you again.

As I said, given that we don't know how much does it actually cost to make, the price that it will have, the number of units that it will sell and the target goal of Nintendo (something that allows them to add that extra bit of cost to every unit to recover the R&D costs), it's impossible to know if they WiiU will be profitable or not.

???

Of course they can absorb the losses from the 3DS. It only has 1 year, and Nintendo has said that they will no longer sell it at a loss in August. They will have 5 more years or so to make their money back.

Wii and DS not being profitable? Are you crazy? They have made loads of money, both with hardware and software (yes, even Wii has sold enough software to be very profitable).

Sony has sold all their consoles at a loss at launch. Same with Microsoft. It's the way they aproach this business and it's one of the reasons PS3 has hurt them so much financially. They make money back with software and accessories.

Yes, you may be right. And you may be wrong. We'll see in 5 years or more.

I was refering to the Gamecube which apparently sold at a 10 dollar loss, or something small at launch, are you talking about the Wii-U when refering to production cost?  And how are the Wii and DS absorbing the 3DS' losses when Nintendo is posting losses?  They wouldn't be losing money if the Wii and DS are currently generating enough money.  They were very profitable before, they're not now.  Though even selling at a profit will the 3DS have the software sales to cover the costs of running Nintendo?  And should the Wii-U fail to break even for the first few years will the 3DS make enough money for Nintendo to stay profitable?  I don't believe it will, the 3DS isn't exactly a software monster, and Nintendo has already released sequels to the games that made the DS sell 400k weekly for years.  Again, my belief is that the current 3DS and VIta sales are due to the current tablet/smartphone market, and the console market will likely shrink for the same reasons.

If I remember correctly, the GameCube was sold at a loss when they droped the price to 99 USD, and for a short period. Again, the GameCube has been the worst consoles, in terms of sales, in Nintendo's history. Using it as an example of what will happen with WiiU won't give you an acurate perspective as things are different with no one entering the console business like Microsoft did, the different success of their predecessors, etc.

On the losses of Nintendo, a real description of the situation would be that a declining Wii, which had a price cut, and DS weren't able to compensate the losses of 3DS and the increased R&D costs of WiiU. The shift of their development studios from Wii/DS to 3DS/WiiU also meant that they weren't able to launch enough big games to help.

There are so many things that can happen in the future that theorize what will happen is too risky.

An examination of their financial reports reveals that Nintendo was actually in the black in the last two quarters of the last financial year. Here's their net income for the 2011-2012 financial year, shown as at each quarter within that year.

Q1: -25,516,000,000 yen

Q1 and Q2: -70,273,000,000 yen

Q1 to Q3: -48,351,000,000 yen

Full year: -43,204,000,000 yen

Now, looking at this, it becomes rather clear - in Q1 there was a relatively modest 25 billion yen loss. In Q2, the loss was nearly 45 billion yen. Then in Q3 (Oct-Dec), they regained about 22 billion yen, and then another 5 billion yen in Q4.

OK, with that in mind, now consider that they've spent the last 24 months in heavy development of the Wii U. The Wii and DS are more than absorbing the loss due to the 3DS. It looks like what drove them into loss was actually Wii U development (research, prototyping, creation of the manufacturing machines, things like that) - that's now effectively finished (I'd assume that the console is up to the manufacturing stage, now), and their main expenditures now, other than manufacturing, would be game development (and marketing), which they'd be doing anyway.

In fact, I wonder if the release of NSMB2 in August might not be to compensate for the high manufacturing cost of Wii U relative to console sales (Wii sales being so low), so that they don't have another quarter loss in Q2 FY2012, purely for the sake of image (otherwise, I'd have thought they would delay it until October, and use it as the start of the holiday schedule).

If anyone, it would be Sony.

I can see the Playstation brand breaking away from Sony (To be Interdependent? or perhaps Purchased by a Google or Apple?)

In some ways we will still have all 3 (MS, Nintendo and PlayStation), but its possible PlayStation will no longer be a "Sony" Brand.

I also think the market is going to be changing significantly after next gen, and its very possible there will be no "Console" by Sony, instead going 100% to Cloud Gaming (might be a very smart purchase they just made).

This user's post has been removed BY SONY

Poll results have almost 50% solely against Sony right now... I'm lovin' it!

But in all seriousness I don't think any of the big three console manufacturers are going anywhere next gen, but it could end up with one of them in pretty bad shape not unlike the end of the 90's with SEGA after the 32/64-bit era started to wind down.

I highly doubt that would be Nintendo simply because they've got a ton of cash in their coffers, and they will continue to bring in young gamers and the casual / expanded audience with the 3DS and Wii U, so that leaves $ony and M$. Right now $ony is in the worst position financially, but they've got some momentum going into next gen, as does M$. But if $ony gets off to another bad start like they did at the beginning of the current gen, then they could indeed be d00med.

If Kaz can turn Sony around then they will be around for a while. Even if he doesn't turn the company around, I believe that Sony will get rid of most of there other divisions and keep the playstation division and maybe TV's. The only way they can keep the TV division is if they make more affordable ones instead of the $2,000 or more ones.