Nintendo's Wii U console continues to underperform and it's dragging the company down. Yesterday the company released its latest financials and it wasn't pretty. For the year ending in March 2014 the company posted an operating loss of $465 million.
In total the company has sold 6.17 million Wii U systems, with 2.72 million of those being sold in the fiscal year ending in March. Compare that with the Sony Playstation 4, which recently reported 7 million sales, and the Xbox One, which reported 5 million units shipped to stores. Both those systems shipped in November 2014.
So what's the plan? According to the report:
Regarding “Wii U,” which still faces a challenging sales situation, Nintendo will focus on efforts that seek to stimulate the platform. By providing software that takes advantage of the “Wii U GamePad,” utilizing its built-in functionality as an NFC reader/writer, and adding “Nintendo DS” Virtual Console titles to the “Wii U” software lineup, Nintendo will seek to enrich the value of the “Wii U GamePad,” the most important differentiator of “Wii U,” and as a result expand the sales of the “Wii U” platform. In terms of compatible software, by positioning “Mario Kart 8,” scheduled to be released globally in May, and “Super Smash Bros. for Wii U,” scheduled to be released this winter, as two main drivers, both of which are titles that a wide range of consumers can enjoy either alone or with other players, Nintendo will seek to supply high quality games on a continuous basis. Moreover, Nintendo will also strive to proactively pursue its digital distribution business through the “Nintendo eShop.”
I'm frankly not sure the Wii U can be saved at this point, but here're my thoughts.
The first thing Nintendo needs to do is fix their digital system. You can purchase digital games for the Wii U but rather than have those games being bound to a Nintendo account, they are bound to the actual hardware. That means if your Wii U dies it takes your game collection with it, unless you send the unit back to Nintendo for repair. If you're enough of a fan to have two Wii U systems in the house, you'd need to purchase two copies of a game to play on both systems.
It's an archaic system that isn't popular with most gamers I know. Nintendo needs to get us turning on our game consoles (and thus creating buzz) and $10-$15 digital games are excellent impulse purchases to get us to do that. But to get those sales to take off they need to fix that system. The good news is that they're working on getting this done.
Next let's talk about the Wii U tablet controller and how it is the "most important differentiator" for the system. I agree that it is, but I'm not certain it's a positive differentiator. The Tablet Controller is great for playing games when someone else wants to watch the TV, sure, but most Nintendo fans already have a 3DS (or an iPad or Android tablet) for those times. As far as integrating the tablet controller into gameplay, that hasn't seemed to catch on.
And I think the reason it hasn't caught on is that this 'second screen' idea isn't as popular as marketing people want us to think it is. I find it's actually a bit annoying to have to switch my attention from TV to controller and back constantly. I can't watch both unless I hold the tablet up in front of me (which gets uncomfortable). If I'm only going to be looking at one screen at a time, why do I need two?
Maybe its just me, though. If you love having your gameplay extended onto the tablet controller, please leave a comment and tell us about it. Maybe I just haven't experienced it being done well.
Last is the online ecosystem. Online multiplayer gaming is hot and while the Wii U supports it, it doesn't seem to a priority for the company. I'm not quite sure how to fix that since Nintendo is still so concerned with online safety. They put a big emphasis on 'local multiplayer' but that's hard to schedule unless you live with a bunch of other gamers.
I'm not even sure about their game strategy at this point. They're putting a lot of emphasis on the launch of Mario Kart 8, for instance. I may be out on the lunatic fringe here, but I don't feel like I need the 8th iteration of a kart game. I suppose with the Nintendo faithful this is a big deal, but I'd like to see something new and fresh coming from Nintendo.
But (all of this is just my opinion, of course) Nintendo's job #1 at this point should be convincing the 6.17 million of us that bought a Wii U to turn them on and play a game on them. Ours hasn't been on in literally months. We'd like to get some use out of it; fix the digital store system and toss out a deal once in a while and I'll start buying some games. That will lead to talking on social networks about how much fun I'm having. Get enough folks doing that and maybe the public will start thinking about the Wii U again. In theory, that will lead to system sales.
That's the best I've got; as I say I'm not 100% convinced the Wii U can be saved. If you have a better idea, share it in the comments, please!
Read more of Peter Smith's TechnoFile blog and follow the latest IT news at ITworld. Follow Peter on Twitter at @pasmith. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.