Nintendo’s latest console, the Wii U is very likely facing stiff competition from both Microsoft and Sony this holiday season across the entire pricing spectrum.  With the PlayStation 4 being announced for holiday 2013, and a very likely announcement from Microsoft that the next-gen Xbox will be releasing in the same window, both companies are likely to largely discount the elder-generation consoles, thus sandwiching the Wii U between two systems (the PS3 and Xbox 360) of similar graphical capabilities and vastly larger libraries at a price point below the $299 Basic bundle that Nintendo sells, and two brand new consoles (the PS4 and Microsoft’s next console currently known as Durango) that are vastly superior technologically at what’s expected to be a moderately higher price point than Nintendo’s $350 Deluxe bundle.  Industry analysts and rumours are running wild of the PlayStation 4′s pricing, but we think that the $450-$500 price range at launch sounds pretty close to the mark and would be very attractive to early adopters.

But it’s not just the pricing that puts the Wii U at risk for the 2013 holiday season.  Nintendo announced the Wii U at E3 2011, showing off an admirable library of both first- and third-party titles to support the console, including Darksiders 2 – a “core” game that wasn’t due to be released until summer 2012.  More importantly, they showed off the Wii U’s tablet style controller so much that apparently people became confused as to whether the controller was a stand-alone portable console or an actual controller.  The announcement hurt Nintendo in three ways that would lay the groundwork for the new console’s struggles at its inevitable launch in November 2012.

First, and most importantly, it gave the engineers at Microsoft and Sony more than ample time to figure out how to do many of the same things as the Wii U controller using existing devices, eventually culminating in the launch of SmartGlass for the Xbox 360 and Remote Play for the PlayStation Vita/PS3 (and later the PS4).  Second, by the time the console released in the 2012 holiday season, most of the third-party games that Nintendo so proudly displayed at their conference would already be released for the 360 and PS3, leaving very little consumer motivation to go out and pick up a Wii U to play games that had been released for months on the other consoles.  Third, while we’re still a few months away from E3 2013, it seems as though the third-party support for the console is still very thin.  As of this writing, only ten more third-party games are slated for release in 2013 on GameStop’s website, with five of those games already available on the 360 and PlayStation 3.  We could be wrong on the third point, and there could be 50 new third-party retail titles announced for the Wii U this holiday season, but it seems unlikely to us.

If Nintendo had launched the console in Spring 2012 – or more ideally, holiday 2011 – rest assured that Nintendo would have enjoyed a significant enough gap to get entrenched in consumer living rooms before the “high end” console announcements came from the Sony and Microsoft camps.  As it stands, the increasing number of rumours regarding an announcement from either Sony or Microsoft very well could have fueled a wait-and-see stance from the masses resulting from too late of a launch for the Wii U among other factors.  Now with the two core-gaming juggernauts warming up to enter the ring later this year, Nintendo could find itself playing the role of referee in what’s almost certain to be a knock-down, drag-out brawl between MS and Sony, left on the sidelines to spectate, rather than fighting for a chance to win the title in this generation of consoles.

http://gamerliving.net/archives/16325

Ideally Holiday 2011? If Nintendo wasn't ready to release it in Holiday 2012, what makes them think they would have been ready in 2011?

Unless they pull a 3ds, the thread title is a given

That's assuming that they launch well and that Nintendo is just sitting around with their thumb up their collective ass.

Nintendo's going to come out swinging, more or less because they have to (against that very problem)

Lol i actually think PS4 is in the worst position for next holiday, due to strong PS3 sales

Depends on the games both systems launch with. If both of them only have 1-2 most have exclusives games (for the very little information we know the only one so far is Killzone: Shadow....something), and the price is "good" then Nintendo could have some problems. History has told us that very rarely system come with "most have" games, so this point in very unlike (in terms of games) imo.

If both consoles have a lackluster launch library plus an expensive price, and Nintendo with Mario Kart and (supposedly) 3D Mario then Nintendo will hold up very nicely. We also might see some surprises coming from Nintendo at E3 that will launch during the holidays.

A holiday discount offer plus a couple of their higher profile games could help Nintendo compete and perhaps win the parents/kids market over Christmas. I never count Nintendo out over the holidays. They just need a few big releases in the final third of the year, something bigger than the Wii U has seen thus far.

Wii was in a similar situation, though. 360 had a one-year head start, and Wii released at a $250 price point alongside a much more powerful machine (PS3). Surely enough people saw enough value in the Wii to justify paying $250 as it remains the top-selling system worldwide by more than 20+ million in system sales. It was merely a slightly-advanced GameCube with a wand controller, and yet it beat both 360 and PS3 despite releasing one year after 360 and being nearly impossible to compare tech-wise to either 360 or PS3.

I'm not sure this article takes into account any previous situations in which certain consoles release a year early or a year late, and how the sales pan out compared to their current-generation counterparts. At lot of the points made don't seem to acknowledge similar things that have happened in the past.

Well, obviously. PS4/X720 are supposed to sell really well in Q4. New stuff always does, because of the fans that are usually early adopters, regardless of price, games, etc. Same happened with WiiU. And most other systems, for that matter. It's what happens after that, in early 2014 that will be telling. I expect gruesome game droughts and low sales, on par with what WiiU's going through right now. I also expect WiiU to do better than PS4/X720 when that time comes, because it will have a robust library by then.

Exactly.  PS3 is just now beginning to hit it's stride.  It was very much a late bloomer, and sales in the west, particularly Europe, as well as some emerging markets, seem to be giving PS3 a second life after US and Japanese sales have begun to cool off. 

PS3 might very well be the first Sony console to actually justify the "ten-year lifecycle" slogan.