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[Kintaro]

Man, this dude is on a roll. :lol

Nintendo's facing "weak" hardware and software sales, but it's the contraction in DS software that's been the most severe, says Wedbush analyst Michael Pachter -- who concludes that the company will likely leverage the launch of the 3DS to drive software prices on its portable platform higher.

Like many industry-watchers, Pachter was impressed by the 3DS' E3 showing, calling it a "revolutionary" device, and predicting "Nintendo will be able to sell millions of units even at a price of upwards of $250."

He continues: "From a software perspective, we believe Nintendo will be able to increase DS software prices, from a blended average of around $25 today to over $29 next year."

NPD results have indicated that the new Wii Sports Resort bundle with MotionPlus that launched in May helped raise Wii sales for the first quarter 4 percent -- but this growth was offset by a 45 percent decline in DS hardware units.

As a result, Pachter lowered his quarterly estimate for Nintendo to 215 billion yen ($2.47 billion) versus the 259 billion yen ($3 billion) previously projected. As the year continues, current sales weakness and the continued "drag" of exchange rates currently unfavorable to the Japanese yen will continue to be a problem for Nintendo, he says.

However, the analyst notes that the anticipated strong launch of the 3DS in the fourth quarter of 2011 should present a better outlook for fiscal 2012. Nintendo's fiscal year ends March 31, and its first quarter closes June 30.

"Despite Q1 weakness, we believe the company will track about in-line with its FY:11 guidance for DS hardware (30 million units) and software (150 million units) and Wii hardware (18 million units) and software (165 million units)," Pachter concludes.

"Wii unit sales should continue [to] accelerate due to the new bundle and a solid release slate (Super Mario Galaxy 2 in Q1, Metroid: Other M in Q2), while DS sales should pick up once the 3DS is introduced (by fiscal end March 2011). "

Yeah, raising those portable prices would be great. May as well charge subscriptions for those too while we're at it.

 

[RurouniZel]

So glad I've never been an online multiplayer person. Doesn't affect me if other people want to waste their money to pay for this shit, just seems like they're ultimately going to lose more money than they are now if they really try this on anything other than guaranteed titles like MW2, and even then lots of people buy that for the multiplayer, and won't if MW3's is subscription based.

 

[FLEABttn]

Yeah, raising those portable prices would be great. May as well charge subscriptions for those too while we're at it.

If Nintendo makes 10% more from increased software prices at the cost of 5% of copies sold, they come out ahead.

I sort of wonder if people grasp at straws when they're trying to shit on Pachter, or if they just have never done anything business related in their lives.

 

[Deleted member 17706]

Afford to give what away for free? It's not like the publishers are paying for anything with p2p multiplayer modes where no dedicated servers exist. Multiplayer is an incentive for people to buy the game. A by-the-books military or space-marine shooter is a pretty hard sell if it doesn't include some kind of multiplayer option.

Pachter seems to be implying that the time people spend on a game should be monetized (in addition to the cost of the game itself).

 

[PflargBlarg]

If Nintendo makes 10% more from increased software prices at the cost of 5% of copies sold, they come out ahead.

I sort of wonder if people grasp at straws when they're trying to shit on Pachter, or if they just have never done anything business related in their lives.

I think most people just bitch about Pachter because it's the cool thing to do. The guy you quoted obviously has no idea what he's talking about. Honestly, nothing Pachter has said has ever made me angry because that would be ridiculous. He's a guy doing some analysis on the gaming industry, why does it make people angry when he gets something wrong?

And...gah, the guy you quoted. What the fuck. Pachter is not saying that's what he WANTS to happen, it's what he thinks Nintendo will be able to do to increase profits. It's his bloody job.

 

[Ryu]

If Nintendo makes 10% more from increased software prices at the cost of 5% of copies sold, they come out ahead.

I sort of wonder if people grasp at straws when they're trying to shit on Pachter, or if they just have never done anything business related in their lives.

Agreed. DS software started at 29.99 but you can find plenty of titles day 1 at 34.99 or even a select few at 39.99 and their top selling software rarely drops in price. Why is higher 3DS prices that hard to believe?

 

[Icarus]

With higher development costs on 3DS, I'd definitely assume $39.99 retail prices, at least during launch. That's what PSP was (and sometimes still is with Square and EA).

 

[6.8]

History proved that Nintendo was right yet again. Online gaming is a fad afterall.

 

[george_us]

You know, it seems like a lot of this mess would go away if Gamestop would give a share of their profits to publishers from their used games sales.

 

[MarshMellow96]

You know, it seems like a lot of this mess would go away if Gamestop would give a share of their profits to publishers from their used games sales.

But people also aren't buying new games because they're playing their old games.

 

[Teriyaki]

Project $10 already makes it a multiplayer sub since it put a price on it. Servers are up for ~20 months so you're paying 50 cents/month for Madden.

 

[Zhengi]

Well, game companies saw players were willing to pay for online multiplayer, so it was only a matter of time before the game industry went down this path. Thankfully, I'm not much of an online player and I enjoy single player games more. Unfortunately, many devs are undercutting the single player experience and focusing on the multiplayer experience. I guess we all lose out here

 

[ZombieSupaStar]

leave pachter alone, dude likes fallout 3 so I haz his back :fistbump

 

[george_us]

But people also aren't buying new games because they're playing their old games.

Well then they shouldn't make their multiplayer so addicting!!!

 

[Sohter.Nura]

The moral of the story is game and used game purchasers just have to accept online multiplayer is going subscription. Publishers just can’t afford to give this stuff away for free, its cannibalising new game sales and used game sales.

That's a problem, because gamers can't afford paying more for gamers either.

We have:

New Game Retail - 60
XBLA - 50 a year
DLC - 10~30?
And now a subscription model for games?

I think these are the issues that I have with having a subscription model for online gaming on consoles:

- Console online isn't as complete as online
- Some games lose online players really, really quick.
- If you pay subscription by game, you might get online without any players in it.
- Some games are not as entertaining online as the others.
- If you pay subscription by company, then you'll have to pay for multiple companie's games?

I think the point of XBLA was to monetize on online games, but I think that's a big conflict with the subscription model at this point =P

 

[Trojita]

According to Microsoft, about 12 million Gold subscribers say yes.

Yeah because paying to play a whole systems amount of games online is really comparable to paying that in addition to paying each company a monthly fee to play their games online.

Online gaming isn't free? Wow videogame companies are getting so whiny this generation. Last time I checked the multiplayer data on the disc is included with the $60 I pay. It's not like they are paying for servers to play the games on.

and ugh pachter

 

[FLEABttn]

- Some games lose online players really, really quick.

Funny thing is that this is a result of the fee for gold and p2p gaming.

When there's a monetary cost to playing games online, people try to maximizes the returns of this investment. People are less forgiving when there's a cost for online play, so if a community isn't seen as "large enough", people will vacate it more quickly.

P2P also impedes on it because the matchmaking logic (as we've seen in AvP, Singularity) can sometime suck some ass or have parameters that spread a thin population even thinner. Dedicated servers allow for people to set up a centralized server than minimizes lag for most people while giving people who like the game a place to congregate. Without these dedicated servers and with matchmaking, you kill off someones desire to play the game if they can't find something fairly quickly.

 

[SonOfABeep]

oops

 

[SonOfABeep]

Hey guys charging a monthly fee for non MMO games will work for sure, right?

 

[SapientWolf]

Funny thing is that this is a result of the fee for gold and p2p gaming.

When there's a monetary cost to playing games online, people try to maximizes the returns of this investment. People are less forgiving when there's a cost for online play, so if a community isn't seen as "large enough", people will vacate it more quickly.

P2P also impedes on it because the matchmaking logic (as we've seen in AvP, Singularity) can sometime suck some ass or have parameters that spread a thin population even thinner. Dedicated servers allow for people to set up a centralized server than minimizes lag for most people while giving people who like the game a place to congregate. Without these dedicated servers and with matchmaking, you kill off someones desire to play the game if they can't find something fairly quickly.

No, it's a consequence of the tendency for gamers to gravitate towards the games with large, active online communities.

This is also why traditional subscription-based online multiplayer would be difficult to implement on the consoles. It will inevitably doom a game unless it can launch with an extremely large and dedicated following and keep them playing and paying.

 

[OldJadedGamer]

I don't buy sports games because their new features year after year don't deserve it. And even a subscription in addition to thes $60+? No way!

I agree. Everyone knows that they should just sell updated roster packs each year for like $20 bucks that you can download but they will never ever do it.

 

[Ducarmel]

why don't they just sell ad space online already, should generate a good amount of revenue.

I must admit I dont play online console games much if this is already happening ignore my post.

 

[Safe Bet]

Unfortunately, many devs are undercutting the single player experience and focusing on the multiplayer experience...

 

[FLEABttn]

No, it's a consequence of the tendency for gamers to gravitate towards the games with large, active online communities.

Games with smaller communities on the PC don't taper off anywhere near the same speed as they do compared to their console counterparts. Ignoring the Live fee and p2p gaming as an influence to this is an oversight.

Everyone knows that they should just sell updated roster packs each year for like $20 bucks that you can download but they will never ever do it.

Why do that when you can sell it for $60 ever year? Even after the packaging costs and the store's cut, you're still coming much farther ahead than a yearly $20 expansion would.