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posted: 9/15/2012 7:14 AM

Nintendo to sell Wii u in Japan from Dec. 8 to revive growth

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  • Nintendo's Wii U GamePad is set to go on sale in Japan in December.

      Nintendo's Wii U GamePad is set to go on sale in Japan in December.
    Associated Press

 
Bloomberg

Nintendo Co., the world's biggest video-game machine maker, will sell its new Wii U console in Japan beginning in December for at least 26,250 yen ($338) as the company tries to recover from its first annual loss.

Nintendo also will sell a premium version for 31,500 yen starting Dec. 8, President Satoru Iwata said in a webcast today. The Kyoto, Japan-based company will offer games including "New Super Mario Bros. U" and "Nintendo Land," Iwata said.

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The console maker counts on the Wii U, the first new home- gaming machine by a major maker since 2006, to propel a recovery after sales of the 3DS handheld player missed projections because of a lack of popular software titles. Nintendo faces growing competition from games played online and on smartphones from companies including Apple Inc., which will begin selling the iPhone 5 next week.

"It sounds inexpensive to me, and probably it's the price that consumers can afford," said Takashi Oka, a Tokyo-based analyst at TIW Inc. "It may prompt existing owners to replace their Wii with the new one."

The stock may rise on the announcement, he said. The basic set will have a white-colored console and eight gigabytes of storage, Nintendo said. The premium set will come with a black- colored console with 32 gigabytes of storage, the company said. Both will include a GamePad touch-screen controller.

Microsoft, Sony Consoles

The Wii U features a 6.2-inch screen controller, which will provide extra information to players as they manipulate games on their TVs. It can also become the primary screen when they move around. The machine includes new social-networking features, allowing players to interact with each other.

"The price is probably set just above production costs so the company won't lose money," said Tomoaki Kawasaki, a Tokyo- based analyst at Iwai Cosmo Securities. "I'm paying close attention to whether there will be innovative software."

Nintendo will hold an event today in New York to unveil plans for the Wii U in the U.S.

Sony Corp. sells its PlayStation 3 game console from 24,980 yen in Japan and $249 in the U.S. Microsoft Corp.'s Xbox is priced from 19,800 yen in Japan, or $199.99 in U.S. stores. Apple's iPhone 5 will have a price tag starting at $199, and the iPad is sold from $499.

3DS Demand

Nintendo rose 2.3 percent to 9,230 yen in Osaka trading before the announcement. The shares have dropped 13 percent this year, compared with a 65 percent gain by Cupertino, California- based Apple.

Iwata, 52, has said software titles will help drive sales of the new console. The 3DS, which cost 25,000 yen in Japan before the price was cut by as much as 40 percent in August, was hobbled by a lack of attractive titles, he said in April.

Lackluster demand for the 3DS, which can beam images in 3- D, coupled with a stronger yen that eroded overseas earnings led to Nintendo posting both operating and net losses in the year ended March 31 -- the first time that's happened since the company went public in 1962. The Americas and Europe accounted for 72 percent of sales, according to its earnings statement.

The machine is being released during an industry slump as consumers abandon consoles in favor of games played on smartphones and social-networking sites including Facebook Inc. When Nintendo introduced its last home video-game console, the Wii, in 2006, the iPhone hadn't yet gone to market, the game "Angry Birds" didn't exist and social-gaming company Zynga Inc. hadn't been founded.

Sales Slump

Retail sales of video-game hardware, software and accessories in the U.S., the world's biggest video-game market, fell 20 percent last month from a year earlier, led by a 39 percent plunge in hardware sales, NPD Group Inc. said Sept. 6. That followed a 20 percent drop in July, according to the Port Washington, New York-based researcher.

Nintendo sold 9.84 million Wii machines in the year ended March 31, compared with 13.9 million PlayStation 3 consoles in the same period. Microsoft sold 14.9 million Xbox machines in 2011.

The Wii U screen on the console's controller will provide extra information to players as they manipulate games on their TVs, and can become the primary screen when they move around. The machine also includes new social-networking features, allowing players to interact with each other.

Tokyo-based Sony will introduce the PlayStation Mobile service later this year, offering titles for HTC Corp. devices as well as its PlayStation Vita portable player and Sony Xperia smartphone, it said in June. At the E3 trade show in June, Redmond, Washington-based Microsoft unveiled an application called Xbox SmartGlass that will link the console to phones, tablets and personal computers from Microsoft and rivals.

Iwata has ruled out the possibility of making Nintendo's characters available for gaming devices other than its own.

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