“What does this mean?”
Nothing. You can’t tell anything until multiple weeks and months. Iwata, himself, told everyone to wait four months.
“So why make this post?”
To ask that you look at two things: software sales and DS sales. If DS sales still remain constant in Japan around 10k week after week, then 3DS has a problem. If all software isn’t moving up, and only a game or two gets a bump, that is bad news.
“Why is this important?”
This is a re-launch of the 3DS. Nintendo is essentially purchasing marketshare by not only drastically lowering the price but pouring money into the advertising.
“Is the 3DS out of the woods?”
No. If this doesn’t work, Nintendo is out of options. A major price cut was their last arrow. If this doesn’t change the longterm trend, only software will do it in the future. And Nintendo is shifting to Wii U development so that software won’t be coming.
I keep showing this image from the Blue Ocean Strategy to make an important point. In order to expand sales, the product needs to travel these tiers. The DS reached its numbers by selling to refusing customers and unexplored non-customers (with software such as Nintendogs and Brain Age).
Price cuts do not sell a product to refusing customers or to markets completely distant. To someone, like myself, who was a ‘refusing customer’ of the Gamecube, cutting the price doesn’t make me want to buy it. And distant non-customers still haven’t heard of the Gamecube or care if it got a price cut or not.
The price cut will only increase sales of the 3DS in the first tier. To those who boycott Nintendo’s 3d philosophy (such as myself, the ‘refusing customer’), the price cut means nothing. I paid around $250 importing the red Japanese DS back in 2006 anyway. And those in distant markets won’t care about the 3DS.
“Stop giving non-answers. Say if it is good or bad.”
We just don’t have enough data. But I’m still greatly pessimistic about the 3DS. Here’s why:
Price Cuts don’t create momentum- Someone tell me of a game console that got momentum because of a price cut. And by momentum, I mean long-term, not just a short spike in sales. The reason why you are having trouble thinking of one is because there isn’t any. I remember years ago people telling us the Wii was doomed because PS3 and Xbox 360 would have ‘price cuts’. But the HD twins’ performance has only been flat this entire generation.
Only Games Create Momentum- Super Mario Brothers and the NES. Tetris and Pokemon and the Gameboy. Donkey Kong Country and the SNES. Sonic and the Genesis. Call of Duty and the Xbox 360. Halo and the Xbox. A most remarkable example is Monster Hunter and PSP.
The reason why the 3DS software lineup is so atrocious is because the software adopts the philosophy of the Gamecube. These are Gamecube games. It is dismal if the game people are most excited about are N64 ports. If these games were so great, why did the N64 perform so badly in the first place? The answer is because the games were never that great. (And I swear Ocarina of Time is the luckiest game in that it never faces competition on the console it appears. There was no competition to it on the N64. And there is certainly no competition to it on the 3DS. If people don’t buy Zelda, what else are they going to buy? Steel Diver? Haha.)
Nintendo is suffering from a sick, sick 3d obsession. The market is rejecting Nintendo’s 3d direction (as it always does). Nintendo is pulling all the stops and changing everything about the 3DS except one thing: the 3d.
The 3DS doesn’t have a price problem. It doesn’t have a marketing problem. It doesn’t have a release time problem. It doesn’t have a game library problem. The problem with the 3DS is the 3d context Nintendo wishes to take gaming. Customers are rebelling against this.
3DS has no competition
The truly bad sign for the 3DS is the fact that its poor performance takes place where it has no competition. Nintendo’s handhelds did have competition. There was the Lynx and Game Gear. The DS had the PSP which was a very strong competitor. But the PSP did not stop the DS from taking off.
The 3DS has no competitors. Vita isn’t out yet. Nintendo has the entire market to itself and is facing an uphill battle. “It is because of smartphones, Malstrom.” Then why are DS systems still selling left and right? Why does everyone try to point to an answer other than ‘market rejection of 3d output’? “Because then they would find themselves agreeing with Sean Malstrom, and we can’t have that.” Apparently not.
But 3DS has now broken past its barrier to sell to children.
And how is this any different from the Gamecube?
My prediction is that the sales increase will be short lived. Lowering the price always opens up a new area of customers with each price drop. Nintendo is attempting to manipulate perception by dropping a great many price barriers at once. Since this move is taking away all the customers that would have been gained from a slower series of metered price cuts, this is placing 3DS into a box. The only way out is correct software (which isn’t Gamecube-esque software).
Nintendo’s move was not well thought out. Remember, Nintendo believes it can manipulate market phenomenons. The proof of it is why Iwata would release several Nintendo games around each other to specifically ‘excite the market’ and attempt to get the market to ‘create a social phenomena’. This is manipulative, and Iwata will be taught who truly is the boss of Nintendo.
The business does not shape the market. It is the market that shapes the business. If the market doesn’t want to go along with Nintendo’s sick 3d obsession, then there is absolutely nothing Nintendo can do. The best way to fight disinterest in gaming is to travel in the direction that people want games to go. This direction is tactile and multiplayer, not visual output.