We don't know yet.
I still think they will cut prices around October. If they don't figure out a way to return the Wii to momentum with Wii Sports Resort that is. I don't really believe they will actually.
Of course this has nothing to do with competition, as much as we like to think it does. But Nintendo got off track when they released Animal Crossing and Wii Music. They misread customers, and they brought out an experience that wasn't optimal. This stopped the Wii momentum, along with the lack of progress and integration with their controller input at that season.
When momentum stops, it is VERY difficult to get it rolling again. And Nintendo absolutely knows this, they will try hard but Iwata, having the experience he does, I'm sure is already expecting it not to work. Because they have the obligation to, they have to legitimately try. And they will do whatever they can, but they won't compromise too much. They will promote, bundle and then price drop.
After that they'll set in motion a brand new strategy of blue oceans, which is already being cooked up.









