Earlier this week, Nintendo announced that the price of their new Nintendo 3DS handheld would be dropping by 32%, to $169, starting August 12th. This unforeseen move comes only six months after the 3DS launched, and is Nintendo's much-needed response to a system launch that was terrible in almost every respect.
There's a number of things to pick on about the way the launch was handled. First of all, the price was way too high for the technology they offered, and everyone knew it. Sony knew it most of all, which is why they unveiled their far more powerful Vita handheld at the same price point, taking 90% of the wind out of Nintendo's sails. Second of all, the 3D technology that Nintendo touted so heavily has received a lukewarm reception at best, with many complaining of headaches and eye strain. Thirdly, the system has not been backed with a decent software lineup, with only one or two standout titles like Super Street Fighter IV 3D Edition or The Legend of Zelda: Ocarina of Time 3D.
Nintendo's big mistake, however, was in entering into competition with itself, and when you fight against yourself you will inevitably lose. The company has been pushing a "blue ocean" strategy that calls for bringing new gamers into the market with interesting software and revolutionary technology. The problem is that Nintendo somehow expected these new gamers to purchase a new $250 system, when a regular DS was available for less than half the price. Not only was the price far more attractive, but the titles that Nintendo is using to expand their audience, the Touch Generations series that includes games like Brain Age and nintendogs, are almost exclusively for the original DS right now. Where is the incentive to go for the new product? Consumers evidently didn't find it, as the DS outsold the 3DS two to one over the past three months.
Now that the 3DS is dropping in price, sales among Nintendo's intended audience are sure to increase. You can soon buy a 3DS for the exact same price as a DSi XL, and for only $20 more than a normal DSi; when the costs are that close, it's much more reasonable to let yourself spend that extra $20 to go for the next generation of technology. The 3DS software isn't there right now, but it will be in just a few short months, and meanwhile owners have the entire DS library to play with. And, if they need to, they can turn off the 3D effect while they play Mario Kart 7.
Does this mean that Sony is going to be seeing troubles with its $250 Vita? Most likely not. Sony's new handheld is a totally different beast, far more powerful and frankly looking a lot more futuristic. That's going to be more of a Mac vs. PC style battle, not like what Nintendo had to deal with. Nintendo's DS/3DS battle was like having two versions of the same product, one incrementally better than the other, but far more expensive than is justified by the situation.
Now that Nintendo is no longer battling themselves, the holiday season is shaping up to be a much more interesting one. With an all-star lineup of software on the way, like Super Mario 3D Land, Mario Kart 7 and Luigi's Mansion 2, Nintendo is poised to clean house and become a must-have piece of technology, if they play their cards right. Nintendo has never been successfully challenged in the handheld arena before, and today's news indicates that Nintendo ever wants to lose that battle to another company. It's fortunate for them that they fixed their big mistake before any serious damage was done.
- Jim Avery for news10.net