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Forums - Sales Discussion - December NPD 2020: Switch 2.1 million, PS5 800K, XBS 700K

Shadow1980 said:

@RolStoppable. I do agree that Animal Crossing would still be a strong system-seller even had COVID not been a thing. However, I don't think it could have pushed the Switch to anything significantly over 7M without the pandemic & stimulus to aid it. Comparing YoY and, perhaps most pertinently, month-over-month sales, it seems likely that the Switch would have sold something closer to 700k in March without the pandemic, assuming that AC itself didn't also benefit from the pandemic. That would still make AC one of the biggest system-sellers ever, maybe the biggest ever in the U.S. in absolute numerical terms (I'd have to go and recalculate everything for comparing it to other games), and that March would still have been one of the best non-holiday months ever in the U.S. April would have seen a big drop-off, though, but AC still could still have had some sort of residual effect, possibly propelling it to as much as 300k that month. Past that, we shouldn't have seen any measurable effect on sales from AC, given that system-sellers never have any impact past their second month (and most never past their first). So, we might have seen a net YoY gain of around 400k for that 2-month period. Had the Switch been on average flat over the remaining 10 months of the year, it could have gotten close to 7M. But had it experienced even a modest drop for those other 10 month, say 10%, it would have been down slightly for the whole year. There's a reason why most predictions had the Switch's 2020 sales being at best flat or slightly up from 2019. Nobody, and I mean nobody, expected it to sell 9 million.

As for those "time limits" you refer to, Nintendo has a well-known habit of running on short generations, killing off even successful systems prematurely. Their home consoles have never lasted longer than 6 years before being replaced (unless you count the Famicom's run in Japan). The Wii could have lasted longer and had better legs had they not bailed on it in 2010-11 to put all their efforts into the Wii U. They released the DS when the GBA was still doing very well, which had the effect of completely sucking the wind out of the GBA's sails. They released the 3DS when the DS was doing even better than what the GBA was doing, which caused the DS's sales to decline rapidly from what was a very healthy baseline.

While I would be pleasantly surprised if they didn't repeat themselves again with the Switch, I honestly wouldn't be surprised if they did it again, because Nintendo is probably always going to do what Nintendoes (sorry, bad pun). If we don't start hearing rumblings of the Switch's successor (which I really think will be a "Switch 2"; same form factor, but with a generation leap in power) by early 2023, then and only then will I be inclined to think the Switch will be longer-lived than the norm for a Nintendo system. But realistically, I think the most likely target date for the Switch's successor will be November 2023, giving it about the same run as the DS had before it was replaced. Maybe March 2024 at the latest.

Given Switch's momentum going into this year, we are likely going to get yet another year without Switch getting its official first price cut. If we assume this price cut will happen in 2022 because that will finally be the year when it's necessary to maintain good sales, then why would the console get replaced only one year later?

I'll say it again, Nintendo is talking about this longer lifecycle to their investors, so it's not some meaningless PR fluff. When Nintendo reiterates this same thing basically every three months and then doesn't stick to this plan, investors will have a lot of questions.

How many years does it usually take for a console to get replaced after it had its first official price cut?



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

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RolStoppable said:
Shadow1980 said:

@RolStoppable. I do agree that Animal Crossing would still be a strong system-seller even had COVID not been a thing. However, I don't think it could have pushed the Switch to anything significantly over 7M without the pandemic & stimulus to aid it. Comparing YoY and, perhaps most pertinently, month-over-month sales, it seems likely that the Switch would have sold something closer to 700k in March without the pandemic, assuming that AC itself didn't also benefit from the pandemic. That would still make AC one of the biggest system-sellers ever, maybe the biggest ever in the U.S. in absolute numerical terms (I'd have to go and recalculate everything for comparing it to other games), and that March would still have been one of the best non-holiday months ever in the U.S. April would have seen a big drop-off, though, but AC still could still have had some sort of residual effect, possibly propelling it to as much as 300k that month. Past that, we shouldn't have seen any measurable effect on sales from AC, given that system-sellers never have any impact past their second month (and most never past their first). So, we might have seen a net YoY gain of around 400k for that 2-month period. Had the Switch been on average flat over the remaining 10 months of the year, it could have gotten close to 7M. But had it experienced even a modest drop for those other 10 month, say 10%, it would have been down slightly for the whole year. There's a reason why most predictions had the Switch's 2020 sales being at best flat or slightly up from 2019. Nobody, and I mean nobody, expected it to sell 9 million.

As for those "time limits" you refer to, Nintendo has a well-known habit of running on short generations, killing off even successful systems prematurely. Their home consoles have never lasted longer than 6 years before being replaced (unless you count the Famicom's run in Japan). The Wii could have lasted longer and had better legs had they not bailed on it in 2010-11 to put all their efforts into the Wii U. They released the DS when the GBA was still doing very well, which had the effect of completely sucking the wind out of the GBA's sails. They released the 3DS when the DS was doing even better than what the GBA was doing, which caused the DS's sales to decline rapidly from what was a very healthy baseline.

While I would be pleasantly surprised if they didn't repeat themselves again with the Switch, I honestly wouldn't be surprised if they did it again, because Nintendo is probably always going to do what Nintendoes (sorry, bad pun). If we don't start hearing rumblings of the Switch's successor (which I really think will be a "Switch 2"; same form factor, but with a generation leap in power) by early 2023, then and only then will I be inclined to think the Switch will be longer-lived than the norm for a Nintendo system. But realistically, I think the most likely target date for the Switch's successor will be November 2023, giving it about the same run as the DS had before it was replaced. Maybe March 2024 at the latest.

Given Switch's momentum going into this year, we are likely going to get yet another year without Switch getting its official first price cut. If we assume this price cut will happen in 2022 because that will finally be the year when it's necessary to maintain good sales, then why would the console get replaced only one year later?

I'll say it again, Nintendo is talking about this longer lifecycle to their investors, so it's not some meaningless PR fluff. When Nintendo reiterates this same thing basically every three months and then doesn't stick to this plan, investors will have a lot of questions.

How many years does it usually take for a console to get replaced after it had its first official price cut?

I am not sure Nintendo will ever price cut. It is unprecedented, but all the console makers have been iffy on price cuts for the past 6+ years.  Holiday promotions would be a thing though. Either way 2023 launch doesn't make sense, March 2024 or later does.



Farsala said:

I am not sure Nintendo will ever price cut. It is unprecedented, but all the console makers have been iffy on price cuts for the past 6+ years.  Holiday promotions would be a thing though. Either way 2023 launch doesn't make sense, March 2024 or later does.

It's only Sony who hasn't cut the price when it was needed. While Microsoft didn't cut the price after a certain point, they ran a multitude of repeated temporary deals for a long time.

It's not possible to fully judge Nintendo's willingness to cut the price until Switch runs in its first situation where a price cut is needed. Up till now Switch sales have always been on a level where a price cut wasn't necessary. You may be right that Nintendo will never cut the price, but in that case it's very probable that Nintendo pursues a value-added strategy where hardware revisions take the prices of the previous SKUs. Either way, we won't see something like Sony's PS4 strategy where neither price nor SKUs improved since fall 2016. Point is, what Sony has done with the PS4 since late 2016 isn't comparable to what Nintendo has down with Switch so far. Price cuts for the PS4 SKUs were absolutely needed to soften the decline of the platform, but Switch has yet to reach such a point in its lifecycle.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

RolStoppable said:

Given Switch's momentum going into this year, we are likely going to get yet another year without Switch getting its official first price cut. If we assume this price cut will happen in 2022 because that will finally be the year when it's necessary to maintain good sales, then why would the console get replaced only one year later?

I'll say it again, Nintendo is talking about this longer lifecycle to their investors, so it's not some meaningless PR fluff. When Nintendo reiterates this same thing basically every three months and then doesn't stick to this plan, investors will have a lot of questions.

How many years does it usually take for a console to get replaced after it had its first official price cut?

I do think 2024 is more likely than 2023 though a point to consider is video game hardware sales are far more important to Nintendo than the other two to the extent Switch sales accounted for around half of their revenue last quarter. If 2022 sales end up being unsatisfactory to Nintendo I could see them potentially releasing the Switch 2 in holiday 2023 so hardware sales don't decline too much. This scenario is unlikely I think but it's something to consider.



Norion said:

I do think 2024 is more likely than 2023 though a point to consider is video game hardware sales are far more important to Nintendo than the other two to the extent Switch sales accounted for around half of their revenue last quarter. If 2022 sales end up being unsatisfactory to Nintendo I could see them potentially releasing the Switch 2 in holiday 2023 so hardware sales don't decline too much. This scenario is unlikely I think but it's something to consider.

The ideal timing for the Switch successor would be a launch during the fiscal year where Switch hardware shipments drop below 10m units. There isn't a good reason to act sooner because software sales peak later than hardware sales. You mention revenue, but that's less important than profits; Nintendo has higher profit margins on software than on hardware, so an overall drop in revenue due to declining hardware sales (which will inevitably happen at some point) won't decrease their profits on a proportional level.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

Around the Network
RolStoppable said:
Norion said:

I do think 2024 is more likely than 2023 though a point to consider is video game hardware sales are far more important to Nintendo than the other two to the extent Switch sales accounted for around half of their revenue last quarter. If 2022 sales end up being unsatisfactory to Nintendo I could see them potentially releasing the Switch 2 in holiday 2023 so hardware sales don't decline too much. This scenario is unlikely I think but it's something to consider.

The ideal timing for the Switch successor would be a launch during the fiscal year where Switch hardware shipments drop below 10m units. There isn't a good reason to act sooner because software sales peak later than hardware sales. You mention revenue, but that's less important than profits; Nintendo has higher profit margins on software than on hardware, so an overall drop in revenue due to declining hardware sales (which will inevitably happen at some point) won't decrease their profits on a proportional level.

That's fair. Holiday 2023 will only really happen at this point if 2022 sales are unsatisfactory and Nintendo reacts to that rashly which isn't impossible since companies can react rashly to things but both those things happening is unlikely so I do expect holiday 2024 for the Switch 2.



RolStoppable said:

Given Switch's momentum going into this year, we are likely going to get yet another year without Switch getting its official first price cut. If we assume this price cut will happen in 2022 because that will finally be the year when it's necessary to maintain good sales, then why would the console get replaced only one year later?

I'll say it again, Nintendo is talking about this longer lifecycle to their investors, so it's not some meaningless PR fluff. When Nintendo reiterates this same thing basically every three months and then doesn't stick to this plan, investors will have a lot of questions.

How many years does it usually take for a console to get replaced after it had its first official price cut?

Usually? Well, there is no "usually," especially if we include PS & Xbox. Permanent price cuts seem to be all over the place when they happen. But Nintendo has been kinda sparse with the price cuts this century, especially when it comes to handhelds. Most models never got a price cut at all, though some new models have been lower-priced ones, meaning they could be viewed as a de facto price cut. Of the models that did get a price cut, the GBA SP didn't get a price cut until 2 months before the DS was released, and the DS Lite didn't get a price cut until after the 3DS was released. The 3DS got a price cut early, but only because it cost too much for what it was and early sales were hurting as a result. As for their home consoles, the Wii & Wii U got one $50 cut a piece; the Wii's was about halfway through the system's 6-year primary lifespan, while the Wii U's was only 10 months after release.

With the Switch, I guess it depends on whether Nintendo approaches it more like one of their handhelds or more like one of their home consoles, and it could very well be more likely to be the former. The Switch Lite could be the closest thing to a price cut it gets, as it was a de facto one by reducing the entry price point by $100. Nintendo may feel like they won't have to cut the price of either Switch model until they get close to releasing the Switch 2 (or whatever the Switch's replacement is).

As for the prospects of a longer life cycle, has it been confirmed that it's something Nintendo is dead set on? Also, does that entail that the Switch won't be replaced before the 6 to 6-½-year mark, or merely that it will continue to get some sort of software support even after it's replaced? They haven't been keen on supporting any of their systems in the long term since the N64 (the NES and, to a lesser extent, the SNES had decent post-replacement support). Nintendo's habit of abandoning a system tends to be preceded by a draw down in development for their current system as they devote more resources for their next one.

Unless they have a lot of massive surprises in store, there's already worrying signs that they're repeating themselves with the Switch. They already blew through most of their big guns by 2019. Of all their games that have sold over 5 million copies, only two (AC and 3D All-Stars) were 2020 titles. Aside from BotW2 and possibly Metroid Prime 4, they don't have any top-tier new first-party games announced for this year. The rest of the upcoming slate of announced titles is mid-tier titles and re-releases of older games. If we don't see something big announced this year like, say, Mario Kart 9 or a new main series Super Mario or Pokemon game, that won't be very encouraging to the prospects of the Switch having a 7-8 year primary life cycle like PS & Xbox.

I'm not saying it won't happen, but Nintendo has yet to give any reason to think that it will happen. Old habits die hard, and I consider the default position to be "Nintendo will keep doing what they've always done since the N64."



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In accordance to the VGC forum rules, §8.5, I hereby exercise my right to demand to be left alone regarding the subject of the effects of the pandemic on video game sales (i.e., "COVID bump").

Shadow1980 said:
RolStoppable said:

Given Switch's momentum going into this year, we are likely going to get yet another year without Switch getting its official first price cut. If we assume this price cut will happen in 2022 because that will finally be the year when it's necessary to maintain good sales, then why would the console get replaced only one year later?

I'll say it again, Nintendo is talking about this longer lifecycle to their investors, so it's not some meaningless PR fluff. When Nintendo reiterates this same thing basically every three months and then doesn't stick to this plan, investors will have a lot of questions.

How many years does it usually take for a console to get replaced after it had its first official price cut?

Usually? Well, there is no "usually," especially if we include PS & Xbox. Permanent price cuts seem to be all over the place when they happen. But Nintendo has been kinda sparse with the price cuts this century, especially when it comes to handhelds. Most models never got a price cut at all, though some new models have been lower-priced ones, meaning they could be viewed as a de facto price cut. Of the models that did get a price cut, the GBA SP didn't get a price cut until 2 months before the DS was released, and the DS Lite didn't get a price cut until after the 3DS was released. The 3DS got a price cut early, but only because it cost too much for what it was and early sales were hurting as a result. As for their home consoles, the Wii & Wii U got one $50 cut a piece; the Wii's was about halfway through the system's 6-year primary lifespan, while the Wii U's was only 10 months after release.

With the Switch, I guess it depends on whether Nintendo approaches it more like one of their handhelds or more like one of their home consoles, and it could very well be more likely to be the former. The Switch Lite could be the closest thing to a price cut it gets, as it was a de facto one by reducing the entry price point by $100. Nintendo may feel like they won't have to cut the price of either Switch model until they get close to releasing the Switch 2 (or whatever the Switch's replacement is).

As for the prospects of a longer life cycle, has it been confirmed that it's something Nintendo is dead set on? Also, does that entail that the Switch won't be replaced before the 6 to 6-½-year mark, or merely that it will continue to get some sort of software support even after it's replaced? They haven't been keen on supporting any of their systems in the long term since the N64 (the NES and, to a lesser extent, the SNES had decent post-replacement support). Nintendo's habit of abandoning a system tends to be preceded by a draw down in development for their current system as they devote more resources for their next one.

Unless they have a lot of massive surprises in store, there's already worrying signs that they're repeating themselves with the Switch. They already blew through most of their big guns by 2019. Of all their games that have sold over 5 million copies, only two (AC and 3D All-Stars) were 2020 titles. Aside from BotW2 and possibly Metroid Prime 4, they don't have any top-tier new first-party games announced for this year. The rest of the upcoming slate of announced titles is mid-tier titles and re-releases of older games. If we don't see something big announced this year like, say, Mario Kart 9 or a new main series Super Mario or Pokemon game, that won't be very encouraging to the prospects of the Switch having a 7-8 year primary life cycle like PS & Xbox.

I'm not saying it won't happen, but Nintendo has yet to give any reason to think that it will happen. Old habits die hard, and I consider the default position to be "Nintendo will keep doing what they've always done since the N64."

Ah yes, the old "released all the big guns argument" that has been made every single year.

You mention how they need to announce something big this year while ignoring the fact that 3D World+Bowser's Fury is releasing next week which is a gauranteed 5+ million seller with potential to do over 10 million.

Then next month is Monster Hunter Rise (not 1st party but a major exclusive). MH4 & MHX each did over 4 million on 3DS so with the Switch affect+World making the series huge in the West, Rise should easily pass 5 million with potential to do 10 million as well.

On top of that we have seen over the last few years that Nintendo is more than willing to announce games just a few months before launch so the whole, "they have nothing scheduled" argument is tired and nonsense at this point.



When the herd loses its way, the shepard must kill the bull that leads them astray.

Shadow1980 said:
RolStoppable said:

Given Switch's momentum going into this year, we are likely going to get yet another year without Switch getting its official first price cut. If we assume this price cut will happen in 2022 because that will finally be the year when it's necessary to maintain good sales, then why would the console get replaced only one year later?

I'll say it again, Nintendo is talking about this longer lifecycle to their investors, so it's not some meaningless PR fluff. When Nintendo reiterates this same thing basically every three months and then doesn't stick to this plan, investors will have a lot of questions.

How many years does it usually take for a console to get replaced after it had its first official price cut?

Usually? Well, there is no "usually," especially if we include PS & Xbox. Permanent price cuts seem to be all over the place when they happen. But Nintendo has been kinda sparse with the price cuts this century, especially when it comes to handhelds. Most models never got a price cut at all, though some new models have been lower-priced ones, meaning they could be viewed as a de facto price cut. Of the models that did get a price cut, the GBA SP didn't get a price cut until 2 months before the DS was released, and the DS Lite didn't get a price cut until after the 3DS was released. The 3DS got a price cut early, but only because it cost too much for what it was and early sales were hurting as a result. As for their home consoles, the Wii & Wii U got one $50 cut a piece; the Wii's was about halfway through the system's 6-year primary lifespan, while the Wii U's was only 10 months after release.

With the Switch, I guess it depends on whether Nintendo approaches it more like one of their handhelds or more like one of their home consoles, and it could very well be more likely to be the former. The Switch Lite could be the closest thing to a price cut it gets, as it was a de facto one by reducing the entry price point by $100. Nintendo may feel like they won't have to cut the price of either Switch model until they get close to releasing the Switch 2 (or whatever the Switch's replacement is).

As for the prospects of a longer life cycle, has it been confirmed that it's something Nintendo is dead set on? Also, does that entail that the Switch won't be replaced before the 6 to 6-½-year mark, or merely that it will continue to get some sort of software support even after it's replaced? They haven't been keen on supporting any of their systems in the long term since the N64 (the NES and, to a lesser extent, the SNES had decent post-replacement support). Nintendo's habit of abandoning a system tends to be preceded by a draw down in development for their current system as they devote more resources for their next one.

Unless they have a lot of massive surprises in store, there's already worrying signs that they're repeating themselves with the Switch. They already blew through most of their big guns by 2019. Of all their games that have sold over 5 million copies, only two (AC and 3D All-Stars) were 2020 titles. Aside from BotW2 and possibly Metroid Prime 4, they don't have any top-tier new first-party games announced for this year. The rest of the upcoming slate of announced titles is mid-tier titles and re-releases of older games. If we don't see something big announced this year like, say, Mario Kart 9 or a new main series Super Mario or Pokemon game, that won't be very encouraging to the prospects of the Switch having a 7-8 year primary life cycle like PS & Xbox.

I'm not saying it won't happen, but Nintendo has yet to give any reason to think that it will happen. Old habits die hard, and I consider the default position to be "Nintendo will keep doing what they've always done since the N64."

Look at the second paragraph in the post you quoted. Investors ask Nintendo about the future outlook of the company regularly and Nintendo answers that a new console isn't coming anytime soon. And yes, what Nintendo means is the timeframe until replacement, not the entire lifetime which includes support after replacement.

Nintendo supported the 3DS for two years after its replacement, so that's also something to consider. The fundamental point of this continued first party support was maintenance of a broad price bracket. Switch was $300, so by keeping the 3DS around, Nintendo had $100-200 covered with their various 3DS models. First party support for the 3DS was phased out around the time when it was feasible to have a cheaper Switch SKU (Switch Lite), albeit a more restricted one. Going forward, you should expect Nintendo to handle it the same way, because the Switch successor is very likely to launch with a price of $300 again. Also, the GB/C, GBA and DS had decent post-replacement support too. Out of Nintendo's successful consoles, there's only the Wii which didn't have post-replacement support, so your stance to make the anomaly your default expectation is puzzling. (Failed consoles getting cut short is the norm in this business, so N64, GC and Wii U seeing no post-replacement support is nothing out of the ordinary.)



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

RolStoppable said:
Shadow1980 said:

Usually? Well, there is no "usually," especially if we include PS & Xbox. Permanent price cuts seem to be all over the place when they happen. But Nintendo has been kinda sparse with the price cuts this century, especially when it comes to handhelds. Most models never got a price cut at all, though some new models have been lower-priced ones, meaning they could be viewed as a de facto price cut. Of the models that did get a price cut, the GBA SP didn't get a price cut until 2 months before the DS was released, and the DS Lite didn't get a price cut until after the 3DS was released. The 3DS got a price cut early, but only because it cost too much for what it was and early sales were hurting as a result. As for their home consoles, the Wii & Wii U got one $50 cut a piece; the Wii's was about halfway through the system's 6-year primary lifespan, while the Wii U's was only 10 months after release.

With the Switch, I guess it depends on whether Nintendo approaches it more like one of their handhelds or more like one of their home consoles, and it could very well be more likely to be the former. The Switch Lite could be the closest thing to a price cut it gets, as it was a de facto one by reducing the entry price point by $100. Nintendo may feel like they won't have to cut the price of either Switch model until they get close to releasing the Switch 2 (or whatever the Switch's replacement is).

As for the prospects of a longer life cycle, has it been confirmed that it's something Nintendo is dead set on? Also, does that entail that the Switch won't be replaced before the 6 to 6-½-year mark, or merely that it will continue to get some sort of software support even after it's replaced? They haven't been keen on supporting any of their systems in the long term since the N64 (the NES and, to a lesser extent, the SNES had decent post-replacement support). Nintendo's habit of abandoning a system tends to be preceded by a draw down in development for their current system as they devote more resources for their next one.

Unless they have a lot of massive surprises in store, there's already worrying signs that they're repeating themselves with the Switch. They already blew through most of their big guns by 2019. Of all their games that have sold over 5 million copies, only two (AC and 3D All-Stars) were 2020 titles. Aside from BotW2 and possibly Metroid Prime 4, they don't have any top-tier new first-party games announced for this year. The rest of the upcoming slate of announced titles is mid-tier titles and re-releases of older games. If we don't see something big announced this year like, say, Mario Kart 9 or a new main series Super Mario or Pokemon game, that won't be very encouraging to the prospects of the Switch having a 7-8 year primary life cycle like PS & Xbox.

I'm not saying it won't happen, but Nintendo has yet to give any reason to think that it will happen. Old habits die hard, and I consider the default position to be "Nintendo will keep doing what they've always done since the N64."

Look at the second paragraph in the post you quoted. Investors ask Nintendo about the future outlook of the company regularly and Nintendo answers that a new console isn't coming anytime soon. And yes, what Nintendo means is the timeframe until replacement, not the entire lifetime which includes support after replacement.

Nintendo supported the 3DS for two years after its replacement, so that's also something to consider. The fundamental point of this continued first party support was maintenance of a broad price bracket. Switch was $300, so by keeping the 3DS around, Nintendo had $100-200 covered with their various 3DS models. First party support for the 3DS was phased out around the time when it was feasible to have a cheaper Switch SKU (Switch Lite), albeit a more restricted one. Going forward, you should expect Nintendo to handle it the same way, because the Switch successor is very likely to launch with a price of $300 again. Also, the GB/C, GBA and DS had decent post-replacement support too. Out of Nintendo's successful consoles, there's only the Wii which didn't have post-replacement support, so your stance to make the anomaly your default expectation is puzzling. (Failed consoles getting cut short is the norm in this business, so N64, GC and Wii U seeing no post-replacement support is nothing out of the ordinary.)

Yeah, Shadow has the classic blindness of the handheld market. The Majority of Nintendo handhelds have a long lifespan, the exception is GBA.