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Nintendo: 3DS accounts for 55% of Japanese hardware sales, Wii U not a “parasite”

Wednesday, 4th July 2012 00:20 GMT By Brenna Hillier

Speaking to shareholders, Nintendo CEO and president Satoru Iwata defended the 3DS’s sales performance to date, and championed the Wii U in the coming console battle.

“Video game consoles have long been ‘parasites’ of TV sets at home.”

“What we should say first is that while the Nintendo 3DS has a certain degree of sales momentum in Japan, the momentum in the US and Europe is currently weak,” Iwata told shareholders at the platform holder’s 72nd annual general meeting.

“To be more specific, sales of the Nintendo 3DS are constant in Japan and in fact we could say the sales volume is exceeding our forecast at the start of this fiscal year. After the beginning of this calendar year, the average unit sales have been 83,000 units on a weekly basis.

“This means that about 55% of all gaming hardware sales in Japan consist of the Nintendo 3DS. Now, with the level of sales momentum for the Nintendo 3DS created since the last year end, we would say the center of the Japanese video game market has been the Nintendo 3DS.”

Iwata acknowledged that higher population international territories are vital to the console’s success but said since the price drop, the 3DS now accounts for “about 20% of the total video game sales in those markets”.

“One of the difficulties Nintendo is facing in terms of spreading the Nintendo 3DS is the difference of the mainstream products between Japan, where the handheld video games are the main products, and the US, where the home console video games are the main ones,” he added.

“In the US, ‘video games means home console video games. However, in Japan, those who say that video games mean home console games are only about half of all respondents, and handheld-type games have more significant appeal.”

Iwata pointed out that the DS took off within a year of its Japanese launch, but took two years to become a bestseller in the US.

Shareholders also proved cagey on the Wii U, asking whether it could possibly be as revolutionary and successful as the Wii, and whether it would attract third-party developers as the Wii has not.

“We can at least assure you that the Wii U will not have such a big difference as the Wii had in comparison to how, on other platforms, developers could expect very different graphic capabilities of generating HD-applicable high-resolution graphics,” I wata said.

“Other companies might launch a next-generation console with more power, but we don’t necessarily think that the difference between the Wii U and such console will be as drastic as what you felt it was between the Wii and the other consoles because there will be fewer and fewer differentiators in graphics.”

Iwata said that some consumers really care about graphical edge and Nintendo will do its bets to cater to them, but had to balance the cost of a bundled console and handheld gaming device – the tablet – when setting a bar. He also reiterated that the Wii U has more going for it than grunt.

“Video game consoles have long been ‘parasites’ of TV sets at home,” he said, noting that the Wii U bucks this trend.

“Not only by competing with other platforms only in regard to the machines’ spec. figures but proposing various ways of using the Wii U, we would like to create a future so even family members who have never touched any video game systems will consider the Wii U something that is convenient to use so that we can maintain its competitiveness for a long time.”

Finally, one shareholder demanded that Nintendo reveal its growth strategy in order to boost share prices. Iwata responded by noting that Nintendo’s shares did not rise when it announced the DS or the Wii, yet both went on to be hugely successful. The executive said Nintendo’s recently detailed focus on digital platforms is the next instance of this.

“Again, since this endeavor has no precedent, I do not believe that you will be able to acknowledge the significance of it until we can say how much our digital business has produced in sales and how much it has contributed to our earnings,” he said.

“We are doing everything that we can do and have prepared ourselves well, and I do believe that it is now a matter of showing the results. We would like to fulfill our duties upon showing to you how our work bears fruit and materializes itself in the form of Nintendo 3DS and Wii U sales figures and profit.”

If you’re at all interested in how a behemoth like Nintendo is run, it’s worth hitting the link at the top to browse the Q&A in full. Iwata addresses some knotty problems including gender balance at the executive level and executive bonuses, as well as some pretty amusing ones like a demand for shuttle buses for shareholders and a request fo DS and Wii U compatibility. There’s also a brief chat with Miyamoto about whether he will ever retire (no).

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