It is funny how so many people do not understand the basic business model.

Prices go up when raw material or labour costs increase.
Example: oil costs more so airline tickets go up.

Prices go down when you are loosing market share.
Example: GM, FORD and CHRYSLER give "employee pricing" and rebates to everyone.

Prices stay the same if your market share is growing, or you have a monopoly.
Examples: Nintendo Wii, MS Windows.

This is the basic business model. The markets (supply and demand) dictate the cost. If Nintendo was like the oil companies, they would have raised the price when they realized people would pay more just to get one because of the short supply. The fact that they did not take advantage of the situation, like so many other industries would, shows integrity.

I understand what Iwata is saying and I mostly agree with him too. I would've been upset if I had bought a PS3 for $600 when it came out and then suffer from boredom the first year from lack of games. Then when games come out worth owning, the price drops happen again and again. You can get a comparable PS3 for $200 less and this was about a year and a half only after release. The same was true of the 360 to some extent too.

So with either system, it made sense to wait for a while on either system. I can buy either of those two systems and not only will I get a much better lineup of games, I'm getting a much cheaper and better version of the system. Of course as any system goes through it's life cycle, they will get better games. The price though may or may not change right away.

That's the thing about the Wii or DS. The Wii is still the same price and the DS has only dropped $20 although they obviously got a enhanced version later on. So basedon price, I have no regrets from getting both early in their life. I got lucky and found a Wii shortly after it came out but I haven;t had to sit by and watch people get it for a cheaper price and think "I should've waited". Honestly, how many people would buy a future system for $500 or $600 if they know that if they just wait a year, there will be a better lineup of games and probably a better price.

That is what Iwata is getting at. A consumer should be able to buy a product and not worry that they price will go down dramatically after you just bought one. I guarantee you that no matter what, in the next generation, no system will launch for more than $400.

Note to self on future purchases:

I'll buy Nintendo right from the start because the price will be right and I know they wont drop the price on me in 2+ years

I'll leave buying Sony and Microsoft for at least 2 years because the price will start high and drop with in 1 year, and keep dropping

"Maybe if he put some of that money he is saving into getting some games for the wii I could take this guy seriously."

Uh, the console with the best games this gen has no games confirmed?

Nintendo are also the only company that didn't raise the rrp of games by $10 this gen (In Australia at least)

How dare Nintendo not drop the Wii's price when it is still selling so well. Damn those bastards!!!

Yeah, like others here I see what he is saying and I agree with his viewpoint. I think it is true when someone buys something only to see it's price drop some time later (that isn't several years, i.e. gamecube comment) they do feel ripped off. It could also be indicative of the Company perhaps (and perhaps not), but perhaps not needing to hae set the price so high originally.

He leads by example. His company built a successful business model and despite criticism, achieved his goal, by making realistic descisions and having a good price point from the very beginning.

i already knew nintendo was greedy.

well good for them they are making 1.4 billion profits but seriously with a economy crisis
their "casual" market consumer wallets would love a price cut.

Key phrase to his comment is over time, Iwata doesn't like that Price drops are done in a way that makes owners feel that they spent too much for a system when they could have wiated, currently the Wii is selling still extremely well, so they have no need to boost sales with a cut, and a cut would only annoy those who spent more for it. If Demand does slacken, and they are at a point where a price drop is needed then you will see one, but now its not needed.

Lol, what the hell are you talking about, Kingofwale? Sony cut the PS3's price by $200 last year and stripped out parts to lower it to the price point we have now. REALLY, I feel that Sony had cheated us when they made a powerful system that could do anything, but they had to take out B/C just because the PS3 was getting eaten up in sales by the PS2 and by taking B/C out, they could lower the price. Seriously, if the price to manufacture the Blu-Ray diode dropped a lot when they reduced the size, why did they still take out the B/C functionality??

I've said this so many fucking times and no one seems to listen that Sony is the company that has cheated consumers. I wish I could have bought the 60GB PS3 at first, but there's no way I could spend $600 on a system. People who own the 60GB should be happy now, as I envy them due to the ability to play PS2 games. I don't like any of the PS3 games one bit. None of them interest me because of either the senseless violence or stupid innovation some people claim would save the system. All the current models out there now are nothing but dust collectors (literally speaking as they absorb dust), but the 60GB are the gems I really want to get my hands on.