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Monday, 7 May 2018

Nintendo Comments On Switch Sales And If They'll Ever Match Wii's Performance

The Nintendo Switch may never match the sales of the Nintendo Wii--but that might not have ever been possible, and Nintendo doesn't sound all that worried about it. In the English translation of a recent investor Q&A, outgoing Nintendo president Tatsumi Kimishima said Nintendo is not necessarily looking for the Switch to match or exceed the Wii in terms of sales. Instead, Kimishima said Nintendo will be happy if it can "adapt and respond to changes in the market" to help the Switch to keep selling well.

"The benchmark is not whether Nintendo Switch sales can surpass total Wii sales, but rather we adapt and respond to changes in the market and strive to continue selling Nintendo Switch as long as possible," Kimishima said.

The Wii was a breakout, phenomenal success, the likes of which industry-watchers and even Nintendo itself probably never expected. It has sold more than 101 million units worldwide, which is ahead of the the Xbox 360 and PlayStation 3, which shifted around 80 million units each. Comparing against other current-generation systems, the PlayStation 4 has shipped around 79 million units. Microsoft does not disclose hardware unit sales, though Xbox One figures are believed to be lower than PS4. The Switch has sold 17.79 million units by Nintendo's latest count. Nintendo plans to sell 20 million more during this fiscal year.

The Wii was phenomenally successful due in part to its mainstream appeal. The Wii U failed mightily to capture a sizeable audience (it sold 13.56 million units), and while the Switch is doing better than the Wii U, it will be a real challenge for it to match the success of the Wii. But hardware is typically sold on very small margins, if not a straight-up loss. Software, services, and peripherals often service as the real money-makers, for Nintendo and others. With the Nintendo Labo, Nintendo is literally selling people cardboard, so that's just one example of what is believed to be a higher-margin venture for the company compared to hardware. Additionally, Nintendo is rolling out a paid online service for the Switch in September, so that will bring in significant, regular revenue for the company if enough people subscribe.

Nintendo has spoken previously about how the Switch may have a longer lifecycle than normal for consoles. Speaking further to this, Kimishima said in the Q&A that he wants the system to remain relevant and compelling for long time to come.

"We need to steadily provide new experiences that will keep consumers always wanting to play Nintendo Switch in order to maintain sales for a long time," he said. "I cannot go into detail here today, but our company has a lot of experience with selling gaming systems, and we will actively incorporate everything we have learned, including our failures, into our planning."

Also during the Q&A, Kimishima said the Switch's second year will be an important one. In particular, Kimishima said Nintendo is planning some initiatives to help the Switch reach people who have never played a Nintendo system, or haven't in a long time.

"Seeing how far we can expand the market in the second year of sales is incredibly important for a video game system, whether it is a handheld game system or a home console system," Kimishima said. "In this second year, the initiatives we are planning come from our recognition that we also have to challenge ourselves to delivering Nintendo Switch into the hands of consumers who have never played a Nintendo platform before, and to those [who] have played before, but not recently."

Kimishima did not go into any more details on the unspecified "initiatives" Nintendo is planning to beef up Switch sales. One part of it, though, is surely the release of new, high-profile games such as Super Smash Bros. for Switch, which is launching this year. Nintendo will show off the game at E3, and it will surely join the likes of The Legend of Zelda: Breath of the Wild and Super Mario Odyssey as system-sellers for the Switch.

The Switch is the fastest-selling console ever in the United States over its first year, according to NPD. What that sounds like is that, over its first year, Nintendo's hybrid console is selling better than the PS4 and Xbox One over their respective first years.

In March, a Wall Street Journal report claimed Nintendo will not release a 2.0 version of the Switch this year, instead electing to peripherals and online features. Kimishima is retiring as Nintendo's president in July; he will be replaced by Shuntaro Furukawa, who is a big fan of the Australian game Golf Story.



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