Nem said: You guys are forgetting that Nintendo over-ordered the Wii U from manufacturers last year. Selling them at 250 will be a lesser loss than keeping them on inventory. They already payed for them last year afterall. I find it extremely likely. They will try to pull a 3DS with Mario kart 8 and Smash. Would be good to see them finally doing something.

im pretty sure nintendo lost so much with the wii u because they ordered much more chips than they used and had to pay for not buying the chips.  they shouldnt lose so much per console.

but i dont see it happen, why not give away 2 games for 300? mk and nsmbu ?  nsmbu isnt hot anymore since 3dworld, and they would hook some people to buy the dlc.

fatslob-:O said: The WII U is already being sold at a loss so no.

Wow sir, I guess I can't argue with that logic. Looks like you win the thread. Congratulations!

Einsam_Delphin said: fatslob-:O said: The WII U is already being sold at a loss so no. Wow sir, I guess I can't argue with that logic. Looks like you win the thread. Congratulations!

Well, they gotta do something if they want to stay relevant this generation.  It's either that or release a secondary SKU without the Gamepad for $200, which I also think it should come bundled with a several Wii games.

Now, will they do it? weIl..  I wouldn't hold my breath.

It has to if they want the game to reach its target market.
At $299 a big portion of the Kart audience will deem it too expensive.

Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Not unless the production price for Wii U goes down significantly somehow before the end of May. Nintendo was losing money back when they were selling the console by itself for $300; dropping the price for the console by essentially $110 (assuming Mario Kart costs $60), would put them at an even worse position than they're in already. Once again, the Wii U always comes bundled with a game now. MK8 will not increase the cost anymore than the already bundled games. While that's true, the difference here is that there are no Wii U bundles that are going for $250 (outside of ones repriced by retailers to simply get rid of their stock). What you're asking for is Nintendo, who was already losing money on the $350 Wii U bundle when it came out, and then cut the bundle price and started eating bigger losses, to now once again increase their loss per console with a bundle that adds another $50 in the negative. That's not going to happen. Yep, it wont happen, just like with the first price cut... oh wait! Why you guys still seem to think losing money is the only factor that plays into whether or not they should price cut despite Nintendo proving twice already that it's not, I'll never know!

Simple: It takes a situation where it's quite difficult to make profit and turns it into one where it's virtually impossible to. Nintendo didn't "prove" that money wasn't the biggest factor by slashing the prices once; they did so, in fact, for the exact opposite reason. They did it because they believed it put them in the best position to make money; if they could convince people to buy their system at a slightly lower price, they could then turn around and sell (hopefully) enough games to those people in order to recoup the losses. Nintendo doesn't run some "donate to gamer's utility" charity where the point is to let gamers just simply have fun.

By your logic, they might as well reduce the price of the Wii U to five bucks, since apparently the ability to make money is no longer Nintendo's main goal. Encouraging the sales of software is one thing, but if you have to lower the price of your console to the point where you can't make any profit unless the buyer purchases a good 15 or so games, then you've overdone it. That's simply bad business practice at that point, and despite all current notions against this, Nintendo strives as much as possible (like any other company) to remain profitable.

MTZehvor said: Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Not unless the production price for Wii U goes down significantly somehow before the end of May. Nintendo was losing money back when they were selling the console by itself for $300; dropping the price for the console by essentially $110 (assuming Mario Kart costs $60), would put them at an even worse position than they're in already. Once again, the Wii U always comes bundled with a game now. MK8 will not increase the cost anymore than the already bundled games. While that's true, the difference here is that there are no Wii U bundles that are going for $250 (outside of ones repriced by retailers to simply get rid of their stock). What you're asking for is Nintendo, who was already losing money on the $350 Wii U bundle when it came out, and then cut the bundle price and started eating bigger losses, to now once again increase their loss per console with a bundle that adds another $50 in the negative. That's not going to happen. Yep, it wont happen, just like with the first price cut... oh wait! Why you guys still seem to think losing money is the only factor that plays into whether or not they should price cut despite Nintendo proving twice already that it's not, I'll never know! Simple: It takes a situation where it's quite difficult to make profit and turns it into one where it's virtually impossible to. Nintendo didn't "prove" that money wasn't the biggest factor by slashing the prices once; they did so, in fact, for the exact opposite reason. They did it because they believed it put them in the best position to make money; if they could convince people to buy their system at a slightly lower price, they could then turn around and sell (hopefully) enough games to those people in order to recoup the losses.

I did not say anything about money being the biggest factor or not, only that currently taking losses is the not the only factor. Nice try though!
The next stuff you said is all the more reason why they should price cut, because they sure aren't gonna make any money when their console isn't selling and their games follow suit.

Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Not unless the production price for Wii U goes down significantly somehow before the end of May. Nintendo was losing money back when they were selling the console by itself for $300; dropping the price for the console by essentially $110 (assuming Mario Kart costs $60), would put them at an even worse position than they're in already. Once again, the Wii U always comes bundled with a game now. MK8 will not increase the cost anymore than the already bundled games. While that's true, the difference here is that there are no Wii U bundles that are going for $250 (outside of ones repriced by retailers to simply get rid of their stock). What you're asking for is Nintendo, who was already losing money on the $350 Wii U bundle when it came out, and then cut the bundle price and started eating bigger losses, to now once again increase their loss per console with a bundle that adds another $50 in the negative. That's not going to happen. Yep, it wont happen, just like with the first price cut... oh wait! Why you guys still seem to think losing money is the only factor that plays into whether or not they should price cut despite Nintendo proving twice already that it's not, I'll never know! Simple: It takes a situation where it's quite difficult to make profit and turns it into one where it's virtually impossible to. Nintendo didn't "prove" that money wasn't the biggest factor by slashing the prices once; they did so, in fact, for the exact opposite reason. They did it because they believed it put them in the best position to make money; if they could convince people to buy their system at a slightly lower price, they could then turn around and sell (hopefully) enough games to those people in order to recoup the losses. I did not say anything about money being the biggest factor or not, only that currently taking losses is the not the only factor. Nice try though! The next stuff you said is all the more reason why they should price cut, because they sure aren't gonna make any money when their console isn't selling and their games follow suit.

Your logic certainly implies it not being the biggest factor.

And no, it's not a reason for the price cut, for several reasons. First off, price cuts have already been shown to be massively ineffective for the Wii U. The Wii U costs about $50 less this year than it did last year, has a full year's worth of games behind it, and is selling 10K or so better weekly than it was last year. That's a pathetic increase for any sort of incentive, let alone a good $50 price cut. If a price cut was going to drastically improve Nintendo's fortunes, it already would have.

Secondly, they may very well not make much money when their console is barely selling. But your plan not only takes away their chance at profit, it puts them at a huge disadvantage as well. You're advocating that Nintendo sell the Wii U at essentially $190 (taking away the $60 for Mario Kart), or, in other words, less than two thirds of what it was being sold for at its launch. Technology improves exponentially, but not that exponentially. There's simply no way for Nintendo to make profit with a handicap like this unless it somehow increases software sales by a factor of three or so, and as the previous price cut has already shown, that isn't going to happen.

In terms of microeconomic theory, Nintendo is currently hovering inbetween the average fixed and average variable costs of their marginal cost graph, meaning that it makes sense for them to stay in business (or, at least, this line of production) for the time being. Your proposition is simply advocating driving them further towards the average variable cost curve in the vain hope that this will somehow magically spike software sales despite precedent arguing against this, which is a policy on par with a struggling football team making all of its tickets a dollar apiece in the hopes that concession stands will cover the lost revenue.

MTZehvor said: Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Yep, it wont happen, just like with the first price cut... oh wait! Why you guys still seem to think losing money is the only factor that plays into whether or not they should price cut despite Nintendo proving twice already that it's not, I'll never know! First off, price cuts have already been shown to be massively ineffective for the Wii U. The Wii U costs about $50 less this year than it did last year, has a full year's worth of games behind it, and is selling 10K or so better weekly than it was last year. That's a pathetic increase for any sort of incentive, let alone a good $50 price cut. If a price cut was going to drastically improve Nintendo's fortunes, it already would have. Secondly, they may very well not make much money when their console is barely selling. But your plan not only takes away their chance at profit, it puts them at a huge disadvantage as well. You're advocating that Nintendo sell the Wii U at essentially $190 (taking away the $60 for Mario Kart), or, in other words, less than two thirds of what it was being sold for at its launch. Technology improves exponentially, but not that exponentially. There's simply no way for Nintendo to make profit with a handicap like this unless it somehow increases software sales by a factor of three or so, and as the previous price cut has already shown, that isn't going to happen. In terms of microeconomic theory, Nintendo is currently hovering inbetween the average fixed and average variable costs of their marginal cost graph, meaning that it makes sense for them to stay in business (or, at least, this line of production) for the time being. Your proposition is simply advocating driving them further towards the average variable cost curve in the vain hope that this will somehow magically spike software sales despite precedent arguing against this, which is a policy on par with a struggling football team making all of its tickets a dollar apiece in the hopes that concession stands will cover the lost revenue.

Price cut you mean, no plural. As said already in the OP, their first price cut was a price cut in name only, as it didn't actually give the Wii U a new price point. It went from $300-$350 to $300, so of course nothing was gonna change. Besides they can't just never price cut again. It's going to happen eventually. As for your next two points, we'd need to know exactly how much Nintendo is losing per system sold to know if it'd be worth it atleast for the short term, which we don't of course.

Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Einsam_Delphin said: MTZehvor said: Yep, it wont happen, just like with the first price cut... oh wait! Why you guys still seem to think losing money is the only factor that plays into whether or not they should price cut despite Nintendo proving twice already that it's not, I'll never know! First off, price cuts have already been shown to be massively ineffective for the Wii U. The Wii U costs about $50 less this year than it did last year, has a full year's worth of games behind it, and is selling 10K or so better weekly than it was last year. That's a pathetic increase for any sort of incentive, let alone a good $50 price cut. If a price cut was going to drastically improve Nintendo's fortunes, it already would have.   Secondly, they may very well not make much money when their console is barely selling. But your plan not only takes away their chance at profit, it puts them at a huge disadvantage as well. You're advocating that Nintendo sell the Wii U at essentially $190 (taking away the $60 for Mario Kart), or, in other words, less than two thirds of what it was being sold for at its launch. Technology improves exponentially, but not that exponentially. There's simply no way for Nintendo to make profit with a handicap like this unless it somehow increases software sales by a factor of three or so, and as the previous price cut has already shown, that isn't going to happen. In terms of microeconomic theory, Nintendo is currently hovering inbetween the average fixed and average variable costs of their marginal cost graph, meaning that it makes sense for them to stay in business (or, at least, this line of production) for the time being. Your proposition is simply advocating driving them further towards the average variable cost curve in the vain hope that this will somehow magically spike software sales despite precedent arguing against this, which is a policy on par with a struggling football team making all of its tickets a dollar apiece in the hopes that concession stands will cover the lost revenue. Price cut you mean, no plural. As said already in the OP, their first price cut was a price cut in name only, as it didn't actually give the Wii U a new price point. It went from $300-$350 to $300, so of course nothing was gonna change. Besides they can't just never price cut again. It's going to happen eventually. As for your next two points, we'd need to know exactly how much Nintendo is losing per system sold to know if it'd be worth it atleast for the short term, which we don't of course.

What do you mean it didn't give the Wii U a new price point? The console went from $350-$300 with a game bundled, and $300-$250 for just the console. It gave the Wii U a new price point that would be just as visible as this new price point.

We don't know exactly how much Nintendo is losing, but it's fairly easy to look at past data and easily tell that this is not a good idea regardless. Let's look at the effects of a price cut. According to this study on video game markups, each individual game sold can at best hope for a $20 profit for the parties involved. And that's a best case scenario. So now, let's assume Nintendo slashes the price of a Wii U down to $250 (which is what it would be with your proposal). The profit being made from the consumer buying Mario Kart as well is $20, since it's a first party title with no one but Nintendo involved. So Nintendo has $210 in the bank for this Wii U.

Now here's the kicker; in order for Nintendo to get back to the ORIGINAL level it was selling the Wii U at ($300), which was still being sold at a loss, they would need to sell 5 other first party titles at the full price of $60. In order for them to actually be profitable, they would need to sell at the very least two more (we know now that the original claim of it only taking one game purchased to make the Wii U profitable was incorrect, so at the very least, it's two), meaning that Nintendo would have to sell SEVEN first party titles (not including Mario Kart 8 thrown in for free) at the very least to be profitable. An attach rating of 8 titles per console is higher than the Wii had, for comparison.

And keep in mind, Nintendo only gets the full $20 if it's a first party title. If second or third parties are involved, such as Retro, Platinum, Ubisoft, etc, Nintendo will get less than that and have to sell even more. Assuming people buy software developed by third parties semi-routinely, Nintendo will need to have a software attach rate of nearly 11 per console, something completely impossible for a console in its second full year on the market.

Currently, the Wii U needs at the very least a software attach rate of 3 first party titles per console in order to simply make it back to the original level it was selling at, and at least 5 to be profitable (and probably more). Is this currently a bad situation? Absolutely; it's a bad scenario Nintendo is in, but at the very least, it's within the realm of possibility to salvage something out of it. Your proposition takes this from a bad scenario and turns it into a living nightmare, one where Nintendo would need every customer to own at least 8 first party titles for them to have a shot at profitability, which is a completely unrealistic expectation for ANY console, let alone one struggling like the Wii U is.

And certainly, the price of the Wii U can't stay at $250 forever. That said, that's no reason to drop it now. You don't see car dealerships selling brand new cars for $500 because they'll eventually have to drop the price that low to sell them. When the production costs of the Wii U decline, then Nintendo can safely drop the price. Until then, this bundle would simply dig them into an even deeper hole than they are already in.