One week ago, the world couldnt wait to see what Nintendo had in store for the game industry. Today, the world wishes it had never found out.
While a select number of consumers (read: a very small number of consumers) will tell you that the games r great, u stupid Call of Duty lover! and that the quality software will come when Nintendo is ready! the reality is that Nintendo (NTDOY) really screwed up last week. Investors immediately responded by bailing on the stock. And in the days since, investors have continued to flee.
...
We havent seen a steady decline like that since Facebooks (NASDAQ: FB) IPO. But thats what you get when you fail to impress consumers, developers, and investors. Thats what you get when you do everything in your power to destroy the console gaming business. If consoles decline during the next generation, Nintendo will be primarily to blame. After all, it was Nintendo who helped expand gaming last time around with the original Wii. The Mario maker convinced senior citizens to game, among others who dont normally do so. Wii U wont do that. Nintendo will be lucky if it can sell Wii U to hardcore gamers.
...
Contrary to what a select few (again, read: a very small number of consumers) will tell you, quality games equal big sales. Lackluster (lame, boring, predicable, and/or sleep-inducing) games do not.
And what if the triple-A games do come later? It could be too late. GameCube had one of the greatest games ever made (Resident Evil 4), but people still wouldnt cough up the money to buy a GameCube because it arrived four years after the console was released. As a result, sales were so low that the games developer and publisher, Capcom, was forced to port it over to PlayStation 2.
...
This does not paint a very good picture for the third-party strategy Nintendo is taking with Wii U. Consumers wont buy Wii U for third-party junk; theyll buy it for triple-A first-party games. But at launch, there wont be any except for Pikmin 3 (a game that only a handful of people care about, myself included) and NEW Super Mario Bros. U, the third side-scrolling Mario game released in the past six years. Will the new Mario be fun? Yes. Will it sell as many systems as Mario 64 and Mario Galaxy? No. It wont produce long lines, it wont lead to massive pre-orders, and it wont inspire anyone to camp outside GameStop (NYSE: GME) and Best Buy (NYSE: BBY) a week in advance.
...
Can the company make a comeback? Sure in five years. It will take a whole other console (and possibly a whole other handheld) for Nintendo to return to the glory days of Wii- and Nintendo DS-sized success.
(For the fastest financial updates, subscribe to Benzinga Pro.)