Nintendo’s handheld gaming console with 3D capabilities, the Nintendo 3DS, now has an official launch date: February 26. Now the world’s top video game company is banking on the 3DS, a successor machine with a 3-D display, to keep its tight grip on mobile game players.
The Nintendo 3DS hand-held console, which allows players to view 3D images without the need for special glasses, will launch in Japan in February 26 2011 and will be sold at the suggested retail price of 25,000 yen (around $300).
But Nintendo, the maker of the Wii home video game system and the Super Mario games, faces challenges. The 3DS will go on sale in late February in Japan and in March in other markets, the company announced Wednesday, which means the device will miss a lift from the crucial year-end sales season that would have shored up its debut.
Nintendo, based in Kyoto, said separately Wednesday that it had slashed its full-year income forecast to ¥90 billion, or $1 billion, from an initial estimate of ¥200 billion, citing the strong yen, which erodes the value of its overseas earnings. Nintendo said lower holiday sales from its six-year-old DS portable machine — and the four-year-old Wii console — would weigh on its bottom line, along with the later release of the 3DS.
The company also faces increasing competition from the likes of Apple, which has started an explicit push of its iPods and iPhones as game playing devices. Another threat is casual online games played through social networking Web sites like Facebook.
Satoru Iwata, Nintendo’s chief executive, struck a cautious note on the 3DS’s prospects at the company’s annual conference, held Wednesday outside Tokyo.
“We are not taking the success of the 3DS for granted,” Mr. Iwata said.
The problems at one of the most dominant forces in video games highlight the difficulties of navigating a fast-changing industry. Nintendo had been a bright spot in Japan’s video game industry, where game makers once on the cutting edge have been usurped by rivals in the United States and Europe.
The company sold 22.8 million Wii consoles last year, leaving its competition in the dust: Sony sold 12.4 million PlayStation 3 consoles, and Microsoft sold 10.7 million Xbox 360s.
In the six years since the DS handheld machine was first introduced, Nintendo has sold 132 million units, trumping the Sony PlayStation Portable, which has sold 62 million over a similar period. Of the five best-selling video game titles of 2009, four were from Nintendo.
In comparison, Apple has sold about 51 million iPhones in the almost four years since its introduction in early 2007. In July, it said cumulative sales of iPhones, iPads and iPod Touches had reached 100 million.
Nintendo has stayed on top by keeping abreast of changes in the industry: While Sony focused on perfecting computer graphics and precision for hard-core game fans, Nintendo brought video games to new audiences by focusing on simplifying user interfaces and developing casual games.
The Wii home console wowed first-time gamers with its user-friendly, wandlike Wii-mote remote controller and casual titles like the exercise game Wii Fit. Sony and Microsoft have followed suit with their own versions of motion-sensing controllers: Sony started selling its PlayStation Move remote in September, while Microsoft is expected to introduce its Kinect add-on device, which lets users control games with gestures and spoken commands, for the Xbox 360 in November.
The Nintendo DS handheld console also captured a wider demographic than rival machines like the Sony PlayStation Portable, with hit titles like Brain Age, a collection of puzzles and tests designed to keep the brain active.
Nintendo officials like to point out that they view any gadget that takes time away from a gamer’s day as a threat, and in that light, Nintendo faces a recent proliferation of rival games and game playing platforms. The Finnish developer Rovio’s game Angry Birds has been a smash hit on the iPhone and iPad, for example, while the FarmVille game by the Silicon Valley start-up Zynga has millions of users on Facebook.
Nintendo’s situation also underscores the challenges facing Japanese manufacturers, which must grapple with the country’s strengthening currency.
The strong yen is wreaking havoc with earnings and could make setting a competitive price for the 3DS console more difficult. The 3DS will carry a price tag of ¥25,000 in Japan, the company said, which comes to about $300 — twice as much as the introductory price for the original DS in 2004.
Still, the 3DS console, which does not require players to wear special glasses to see three-dimensional images, has won rave reviews since a prototype was shown at the E3 trade fair in Los Angeles in June. The burst of 3-D technology could woo back hard-core gamers while still attracting a wider base of casual players, critics say.
In the market for dedicated video game machines, moreover, the 3DS will face virtually no rivals: Sony has not announced a successor to its PlayStation Portable console, despite persistent rumors of one, and Microsoft has no mobile video game strategy to speak of.
The 3DS comes with two screens, like the current generation of DS consoles: The top screen can display 3-D images, while the bottom is a touch screen for players to navigate with a stylus. A side button lets players adjust the intensity of the 3-D image.
The 3DS also comes with a camera that takes photos in 3-D and with wireless technology that allows the console to automatically link to other 3DS consoles in the vicinity.
The company could have mistimed its introduction of the 3DS by announcing some details of the product months ago, in March, sapping demand for the current generation of DS consoles and games.
“It is not a very big deal for earnings, but for sentiment it is,” said Atul Goyal, technology analyst at CLSA Asia-Pacific Markets, referring to the later release date. “Investors who were hoping to shift their focus to a new product cycle now have to wait another five months to get excited.” [via Dailt Telegraph (UK), Mashable and NY Times]