Pureauthor said:
Lapsed, concerning your 'Nintendo aims to sell to everyone' argument, doesn't seem a bit suspect when Nintendo itself appears completely unprepared for the massive DS success in the first place? They can't produce enough DSLs, they can't keep up on cart production, causing games to have wonky print runs, they even had a plastic game case shortage at one point.
I mean, what they say doesn't seem to match up with what they planned for.
Would you rather have retailers demanding more of your product or saying they have too much? It's an interesting contrast to Sony and Microsoft's approach of stuffing the inventory full of product. This allows Nintendo much more leverage over retailers. But it is also more profitable.
It should be clear to anyone that Nintendo's priority is a strong balance sheet. If it comes down to a choice of losing marketshare or some demand and having a healthier balance sheet, they'll choose balance sheet every single time. A great example is Sony shipping PS3s over planes and Nintendo shipping Wiis over boats. Both products are in high demand (for PS3, a month ago let's say). But using boat costs far less than plane. And, even though Wiis are sold out, Nintendo feels no need to spend that money to get Wiis in a little earlier.
When the Wii launched, Shop Channel and VC were ready because that made Nintendo money while Weather Channel, News Channel, and Opera browser did not. (You can see where the priority is.) Nintendo can delay online at launch (except to Shop Channel naturally) because it makes them no money (though they have to deliver eventually or the console's reputation suffers).
When one of Nintendo's console engineers was interviewed, he explained why Nintendo took such care to make sure their hardware and controllers were reliable and wouldn't fail. Nintendo wants you spending your entertainment dollars on more software (which is very profitable) instead of replacing your hardware (which is not that profitable).
In the Wii interviews, a female artist working on Twilight Princess explained how she spent lots of time on a particular shop. Iwata got on to her about how expensive that was. When IGN interviewed Miyamoto about a new Kid Icarus, Miyamoto's first question was, "Would you buy it?" The question to Nintendo isn't whether a new Kid Icarus should be made, but whether a new Kid Icarus would sell.
The 'it prints money.gif' is perfect because that is what Nintendo gets excited about. A 'it increases marketshare.gif' or 'it is getting non-gamers.gif' wouldn't be as funny because, while true, that's not what Nintendo's ultimate goal is. They want more profits, and they chose their business strategy not because it is 'winning', but because it is the most 'profitable'.
Increasing production is not pressing a button of 'high speed'. It costs money and time to ramp up production. It costs money to keep a large inventory. Nintendo
has increased production (such as the DS), but they appear to increase it incrementally. Nintendo will never flood the market with hardware except right before a holiday season (or Pokemon release). And, after coming from the Gamecube, it is going to be a while to ramp up production of Wiis.
Nintendo isn't interested in making video games. They are interested in making money printing presses. Entertainment dollars are equal from both the gamer and non-gamer.