What is Iwata saying here?

Let us open the newspaper together, reader!

Ahh, there we go.

What is this? What is Iwata saying? Perhaps I should shut up and let him speak for himself.

Nintendo’s platform business could be “in trouble” if the Wii doesn’t perform well this Christmas, president Satoru Iwata has confessed.

Since the vast majority of all game console sales occur in Christmas, any game console will be ‘in trouble’ if it doesn’t perform well at Christmas.

Speaking during a recent investor call, Iwata admitted that current sales of the Wii “are not very strong”, but reaffirmed that Nintendo still believes it can grow this part of its business.

“When we see the current situation, and when we analyze the mindsets of people who have not purchased Wii yet, our understanding is that the sales will be much more concentrated during the year-end sales season than before,” he told investors.

“This is not an observation held by Nintendo alone. In fact, as we discuss with many retailers around the world as to what will become of this year-end sales season, most of them view the trend just as we do.

The common wisdom is that people will buy the Wii more around holidays. I disagree with this. The only reason why people are saying this is because Wii has never had a bad holiday.  The reason why 2009 was not a bad holiday for Wii was because of games like Mario 5. If there was no Mario 5, I do not think the Wii would have sold well then.

Iwata is aware that sales may not be contained to holidays as the Common Wisdom is thinking. As a business does, Nintendo is working on its contingency plan.

The contingency plan is about the new Wii remote that contains Motion Plus. It is about making more motion controlled software that will be released in 2011.

“Accordingly, when our consumers are ready to select what they want to purchase for a Christmas gift, how we can encourage them to choose Wii, has now become important. In other words, we do not have the mindset that our home game console business will not see any further growth so therefore, we have to do something to sustain the sales.”

Translated: “Wii sales will grow if we put out Wii software, instead of Gamecube software, which is already in the oven. In the meantime, we are bundling 2d Mario with the Wii.”

Iwata named the just-announced Wii Remote Plus as “just one part of endeavours” to help maintain Wii sales over Christmas.

This is ridiculous as there is no new motion plus software for this controller. The true reason why Nintendo put it out is to prepare for software that has yet to be announced. Nintendo does not put out new controllers just for the thrill of it. There is a purpose for it.

And the purpose of the new controller isn’t that people will say, “OMG! Motion Plus is in the Wii controller! I must buy a Wii immediately!” Nintendo is planning past this Christmas which Iwata says himself.

“Having said that, however, in that critical sales season, if everything doesn’t go ahead just as we hope, and if we do not do anything about it, our platform business will be in trouble. We will need to prepare for such situations.”

Business is very much about preparing for the future. If the Wii sales go through the roof and Nintendo runs out of stock, all is well. But Nintendo cannot count on that to happen. Nintendo is planning on it to NOT occur which is a good sign.