Isn't the reason for the missed software targets the missed hardware targets? However, as the userbase accumlates new hardware sales account for a lower proportion of total hardware sales which in turn lessens the impact of monthly hardware sales on monthly software sales. Even if they have underperformed relative to expectations, they are in absolute terms at a good level.
Missed hardware in a sense does lead to lower software sales, but what also matters is how engaged the customers who own the hardware are. If you aren't selling to the kind of people who buy a lot of software, you have to sell a huge number of units to make major strides in software sales.
The PSP had this problem for example. The PSP shipped around 80 million units, but in its last few years of life it had almost no active buyers of software, since the people who picked it up moved on to buying lots of games for consoles or other platforms instead and stopped buying PSP games.
This is why its late-gen software in the West performed a lot like Vita software does these days, because they had around the same number of active buyers despite the astronomical install base difference.
The 3DS buying population in the West for third party games (which is what you get licensing fees for) means it's worth bringing them over, but I'm not sure it's worth throwing away $40+ of profit per hardware unit to get potentially marginal increases in software sales.
Mpl90's argument about hardware momentum is probably the strongest one for taking a hit on profits in order to sell more units, because you want a platform to be doing well by the time the next one comes around. However, that's also achievable by simply releasing the next hardware earlier. They do need to do something to make sure it can last until they can get the next hardware out the door, so they obviously need to do some level of incentives. Let me restate that I'm not saying they should do nothing, but rather that they should be careful as opposed to potentially loss leading.
That said, if they actually don't feel enough strain from investors to be worried about having poor financial results then what I'm saying doesn't really matter, since then the urge to prove out that handhelds are still a viable profit generator to investors in order to ensure they can keep releasing them without getting booted out of their jobs is not pertinent.
Also, if first party sales are higher in the west isn't that a good for Nintendo since they make much more profit on first party software sales? We've also had two first party games this month with Smash Bros and Pokemon remakes later in the year. Seems decent enough for this year and there's likely to be more announcements at E3.
My assumption is that they can't actually float 3DS software at sufficient levels to necessarily capitalize on the hardware gains they make in the West the same way I think they very easily can in Japan.
That's not to say they shouldn't make any hardware initiatives, I certainly think they should, but that I feel they should be much more choosy about the decisions they make for the West than those they might make in their home market.
Any particular reason why you think it would do as well as Wii U rather than doing as well as PS4 has? Nintendo have a perfect record on handhelds with all of them being successful. They also seem likely to once again have a complete monopoly on handhelds and probably won't repeat the pricing mistake.
Here's how handhelds have evolved gen over gen.
The segment as a whole is down 82% gen over gen, and the 3DS is currently far behind the PSP at the same point in its lifecycle (about 50% down gen over gen in this comparable year), much less the DS which was doing about four times as well as the 3DS is now.
Handhelds in the West are in very, very heavy decline, and the 3DS is no exception.
I don't think they have room to burn off more of their remaining audience by not giving them a new device for a long time given how much they imploded already.
Now, they were so high up that at least the 3DS isn't a catastrophic disaster like the Vita, but in the West it's mediocre at best, so I think they need to really focus on being protective of their position and do what they can to protect the position of dedicated handhelds. Given how the market for consumer electronics has shifted to much quicker device changes, and the longer a device lasts the more outdated it becomes, I think sitting this long would be very painful.
I missed this whole thread. I guess the numbers are pretty solid now? If so, here's some comps.
Year Over Year
Code:
Console 2014 2013 %Change
XB1 115
360 71 130 -45%
PS4 199
PS3 35 102 -66%
WIU 49 38 29%
WII 18 42 -57%
3DS 106 113 -6%
NDS 48
PSV 3 20 -85%
PSP 7
Family
MSFT 186 130 43%
SONY 237 129 84%
NINT 173 241 -28%
HAND 109 188 -42%
CONSOLE 487 312 56%
Gen over Gen
Code:
Console 2014 2007 %Change
360 174
PS2 194
WII 360
PS3 82
TOTAL 487 810 -40%
Handheld 2014 2008 %Change
NDS 415
PSP 193
Total 109 608 -82%
And here's the always exciting Powerhouse 3DS vs PSP race:
Code:
3DS 2014 PSP 2008 NDS 2008
January 97 230 251
February 153 243 587
March 159 297 698
April 106 193 415
May 182 452
June 337 783
July 222 608
August 253 518
September 238 537
October 193 491
November 421 1570
December 1020 3040
515 3829 9950
