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Nintendo admits iPhone, iPod hurting sales

updated 02:20 pm EDT, Thu July 30, 2009

Nintendo Hurt by iPhone

Nintendo today encountered a rare setback in its history owed partially to the impact of Apple on its business. The company's profit has dropped a steep 66 percent year-over-year to $426 million and said in a conference call that the iPhone and iPod touch, not Sony's PSP, are having the greatest impact on the performance of the DS and DSi. It also expects its fiscal 2010 profit to drop for the first time in years as a result of the added pressure from Apple's touchscreen devices.

The Japanese company didn't outline what if any steps it would take to compete against Apple. The latter inadvertently became a competitor to Nintendo after the launch of the App Store brought a disproportionately large number of games to the iPhone and iPod, encouraging their creator to devote more of its resources to game developers and producing more game-friendly hardware. Apple's devices are much faster at intense graphics than the DS and are helped by the low prices of their download-only titles, many of which cost $10 or less compared to the $30 typical for Nintendo's cartridge-based games.

Critics often believe the DSi was meant as a partial response to Apple that would include a camera, a basic music player and a web browser as well as support for downloadable games. That advantage in creating images may erode with multiple rumors of an iPod touch with camera being introduced this September, possibly with video capture.

Sales of the Wii also unusually plummeted, dropping from just under 5.2 million in spring 2008 to just over 2.2 million this past quarter. With Microsoft likely having only made small gains and Sony's PS3 shipments having dropped from 1.7 million a year ago to 1.1 million, the decline is ascribed to the poor economy's chilling effect on video game sales as a whole. Nintendo so far has been the only console maker this generation never to cut its system price to boost sales and has remained firm at $250 since launching in 2006.



By Electronista Staff
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Comments

  1. Saint_Stryfe

    Fresh-Faced Recruit

    Joined: Jul 2001

    0

    I'd suggest...

    It's more that the DS is now 5 years old, the Lite is 3 years old ,the DSi is not an overly compelling piece of hardware, and Apple's smashing Home Runs every year gaming-wise.

  1. starwarrior

    Fresh-Faced Recruit

    Joined: Mar 2006

    0

    inadvertently?

    They will not let me in, but I can see the Apple roadmap into the future on the wall. Every time a new invention or a consumer trend is noted the maps future changes accordingly. Words like "inadvertently" are only used by people who are very far behind the curve. This seer ability is obviously inherent in Mr Jobs but I bet that it has been software and humanware institutionalized in his great company by now.
    "Surprised" Apple is not.

  1. The Vicar

    Junior Member

    Joined: Jul 2009

    0

    Huh.

    I wouldn't have expected this, really. The iPod touch, at least, is a terrible gaming system -- there is simply no way to build a reliable set of controls for the thing; the motion sensing is terrible and the touch sensing, though reliable, isn't very accurate and requires you to lose screen real estate to your own fingers.

    I suppose it's true, but I find it amazing.

  1. iphonerulez

    Dedicated MacNNer

    Joined: Nov 2008

    0

    It won't be easy for

    Nintendo to start offering downloadable games on it's platform. Cartridges are pretty much fading away. It's hard to imagine that those games cost $30 and they need all that packaging and distribution.
    Yet when I hang read through some of the comments at TouchArcade people are still complaining that $5 App Store games are too expensive. I can only imagine what the Nintendo crowd thinks about those $30 cartridges. Buy just 6 game cartridges and you've paid for the DS again.

    Apple appears to be taking out a lot of competition at once in many different areas. Or at least heavily impacting their sales. Definitely impressive.

  1. Telekinesis

    Fresh-Faced Recruit

    Joined: Mar 2009

    +4

    Nin sits on their hands.

    Good, now finally they will get their asses in gear and update the DS's hardware specs and not frivolous things like a new color or cheapy camera. they said they were waiting for a the right moment perhaps Apple will nudge them in the right direction.

  1. Manolo

    Fresh-Faced Recruit

    Joined: Oct 2006

    0

    /wish

    Now if they would just roll over and make iPhone Apps of their most popular games!

  1. Peter Bonte

    Fresh-Faced Recruit

    Joined: Aug 2001

    +3

    Price

    DS games are $20 up to $50, that is way to expensive. iPhone games are basically $1 to $5 and they run on all devices on the same account, Apple is winning on price.

  1. TiberiusMonkey

    Fresh-Faced Recruit

    Joined: Jul 2008

    +2

    I have to admit...

    ...I never bought my iPhone with games in mind (even as a long time gamer) and only dabbled a little with a few of the better known games on the Appstore, but then came Worms and soon after it Monkey Island and I was hooked. I now find myself playing it over my other gaming machines (and even picked up Monkey Island on the iPhone over getting it on the PC).

  1. c4rlob

    Fresh-Faced Recruit

    Joined: May 2009

    +2

    eating words

    All these companies that inititally started off by saying "We think our customers are different and that the iPhone/iPodtouch are different from what we do so we're not worried about it..." All of them are now owning up to sharper than expected losses.

  1. DeezNutts

    Fresh-Faced Recruit

    Joined: Apr 2008

    0

    possibly misleading


    Reading the article you'd think that Apple single handed blew out Nintendo's profit.

    Funny thing is you read any of the mainstream media stories and nintendo is quoted as laying blame on a lack of compelling software as the leader for hardware declines.

    I know this is macnn, but for christ's sake does everything have to be so over the top if apple is mentioned anywhere?

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