Nintendo to cut Wii price by 20pc
Tokyo, September 24, 2009
Nintendo will cut the price of its popular Wii video game console by 20 per cent, responding to similar cuts by rivals Sony Corp and Microsoft aimed at kick-starting demand.
Nintendo said it would lower the price of the Wii by $50 to $199.99 in the US starting Sunday. The price in Japan will fall by 50,000 yen ($550) to 20,000 yen on October 1.
The move makes Nintendo the last among its peers to cut prices. Last month, Microsoft Corp slashed $100 off the price of its high-end Xbox 360 console and Sony Corp cut the price of its PlayStation 3 by $100.
Nintendo has so far outsold its rivals in this generation of consoles. It has succeeded in broadening the gaming population by offering intuitive and easy-to-play games rather than focusing on life-like graphics like Sony and Microsoft.
But Wii sales have tailed off in recent months and competition was set to get tougher after its rivals cut prices.
"Given signs of sluggishness in Wii sales recently, cutting the price at this time should be positive for Nintendo," said Mizuho Investors Securities analyst Etsuko Tamura. "Nintendo should be able to retain its dominant position."
Shares of Nintendo were up 1.4 per cent, roughly in line with the broader market. Reports about the Wii price cuts first appeared on blogs including Kotaku and Engadget.
Sony said that sales of the PS3 totalled one million in the three weeks since it launched a slimmer, cheaper version of the game console.
Prices for both Xbox 360 and PS3 now start at about $300, although Microsoft also sells a low-end model, the Xbox Arcade, for about $200.
Video game industry sales have slumped over the past six months, and hardware sales in August declined by 25 per cent, according to research group NPD.
Analysts have pegged the drop to cautious spending by consumers in the tough economic environment, and a dearth of top-selling games.
Long-awaited console price cuts and new games, including updates to the "Halo,"
"Guitar Hero" and "Call of Duty" franchises are expected to boost sales in coming months. – Reuters