Game Stooge

Nintendo Heading Towards Disaster

• Scribbled on December 16th, 2009 by Jordan Lund
• Filed in Editorial Content, Industry News, NPD, Nintendo Wii

There’s an old saying: “In an evolving universe he who stands still, moves backwards.”

Gamasutra has noted this to be especially true for Nintendo as their software revenue has dropped 18% in 2009 compared to last year. They did miss an even bigger point however: Wii software sales have dropped 18%, but their hardware base has jumped up from 15,370,600 in the United States at the end of November, 2008 to 23,304,600 at the end of November, 2009. That’s an increase in user base of 51.6%. They sold more software with 15 million unit sales than they did with 23 million unit sales. That’s a huge problem. Wii fans love their Wii Sports, Wii Play and Wii Fit and not much else.

Looking at global sales on VGChartz you’ll find that while the Wii has sold close to 60 million hardware units worldwide, the best selling software packages are all gimmick hardware bundles. Of the top 10 best selling Wii games, 9 of them are also Nintendo titles, fueling the argument that Nintendo makes money on their platforms and nobody else does. The remaining hold-out in the top 10 is a Sega title which prominently features Mario so it may as well have been a Nintendo title.

Out of 774 listed Wii titles, only 67 of them have sold a million copies or more. On a platform with a built in audience of 60 million players. That’s not even the half of it. Get this: 396 of those 774 titles sold 100,000 copies or less. Put another way, 51% of Wii games are completely ignored by 99.83% (or more) of their potential audience. An audience that keeps growing by the day.

So where are the games being bought? Both the Xbox 360 and the PlayStation 3 are seeing gains in terms of hardware sales and software sales. 360 software market share is up 9% from last year, that’s almost double the 5% in hardware growth they’ve seen this year. PS3 market share has increased 4%, which doesn’t seem like a lot compared to the 360, but it’s far better than the 5% loss in share that the Wii experienced.

I’ve said from the beginning that the Wii platform is a soccer mom driven fad and when that fad implodes (as did Cabbage Patch Dolls, Tickle Me Elmo and Beanie Babies) what you’re left with is an audience which doesn’t like games, doesn’t buy games and doesn’t play games. That’s exactly the pattern we’re seeing. When the tale of the Wii is written and people ask “What happened? How did we go from selling 60 million pieces of hardware with no software?” the answer will be “You targeted people who don’t play games.”