The Wii U is dead in its current form, admits Nintendo. But what now?By
on January 20, 2014 at 7:20 amShare This articleIt’s taken years longer than it should’ve, but Nintendo has finally woken up to the fact that it can’t maintain a closed-garden ecosystem forever. It’s been more than a year since the Wii U launched, and any expectation that the console would drive early sales and become the must-have gaming platform of the 2013 died months ago. Now, the chances that the Wii U survives in its current form have taken a crippling blow. On Friday, Nintendo announced that it was revising its shipment forecast downwards by 6.8 million units and its sales forecast downwards by over $750M.Losing that much money — and $750M is no small chunk of change — is a huge blow to the console manufacturer that famously led the last generation of console shipments and created a platform that had everyone talking about its advantages. For Nintendo, the problem is simple: A lackluster launch and dearth of titles were followed by month after month of lackluster launches and a dearth of playable titles.Sales are thought to have been strong in December, with Wii U shipments picking up to 500,000 units and multiple new game launches, but there’s only so much that a good month can do, particularly given that the first quarter is typically sharply down compared to the previous year. Wii U software sales
just 19 million units instead of the original 38 million, and the 3DS projections , despite Nintendo
in 2013 than any other console.In short, everything about this news is bad, and investors punished Nintendo for it on Friday. The stock shed 17% of its value in a matter of hours, falling from $18 to $14.40.The Wii U has failed. Now what?I’m going to go on record now and say it: The Wii U’s chance of being a major player this generation is gone. That doesn’t mean games won’t ship for it, and that it won’t offer some compelling adventures of its own — Nintendo still owns a core library of franchises that Sony and Microsoft would cheerfully kill for. Nevertheless, the window of opportunity for the Wii U to blow open the next generation of consoles and direct the future of the market with its own hardware? That’s gone. Whatever Nintendo does now, it’s going to be fighting uphill for the rest of this generation and struggling to secure a spot for itself. Best case, it becomes a niche console with a niche usage model.Nintendo’s president, to his credit, is aware of this. Saturo Iwata has no plans to resign, despite presiding over Nintendo’s worst failure in decades, but told the reporters, “We are thinking about a new business structure. Given the expansion of smart devices, we are naturally studying how smart devices can be used to grow the game-player business. It’s not as simple as enabling Mario to move on a smartphone.”Of course, Iwata is correct. It’s nowhere near that simple, and throwing open the gates to third-party clones and cheap, crappy imitations would be a disaster for Nintendo, quickly destroying in a matter of years the reputation for high quality that the company spent decades cultivating. Say what you want about the Wii U as a console, no one argues that the games are bad.The problem, of course, is that Iwata may interpret the cataclysmic sales of the Wii U and the push into smartphones as proof that the world wants Nintendo to make a smartphone. Little could be further from the truth.The Wii U: Right idea, wrong hardwareThe irony of this, of course, is that Nintendo actually understood . The idea of a gaming tablet that you pick up and carry around the house is something that game companies like Sony and Microsoft are pouring billions into. Sony has the PlayStation Vita and its newly minted
service, while Microsoft has SmartGlass and its own plans for cloud driven Xbox Live gaming and back-end software rendering. Second screens are increasingly popular for gaming.Treating the Wii U as a local rendering station and using the tablet as a portable gaming device is actually a really smart move for Nintendo to make. The only problem is, the company went with the wrong hardware in implementing it. The Wii U focused on tiny form factors and low noise — so much so that its CPU upgrades barely qualified it as last gen, while its GPU is far more advanced than the old Xbox 360 or PS3 — but isn’t anywhere near the Xbox One or PS4.Eurogamer.net has published a
of what went wrong with the Wii U, including information that Nintendo’s dev tools were basically nonexistent, and that everything was precisely as half-assed as it looked from the exterior. More than anything, however, it looks like Nintendo’s decision to focus on an ultra-low-power design fatally crippled the product.
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