Nintendo won’t sell the Wii U at a loss
According to Nintendo designer Katsuya Eguchi, the company doesn’t want to sell the Wii U at a loss when the console launches later this year. Usually, when new consoles launch, their hardware is very powerful and advanced, which makes it quite expensive. Therefore, the console is initially sold at a loss, and money is made in the long run. For example, when the PlayStation 3 launched, it cost Sony over $800 to make a PS3 console, while it cost $500 for consumers.
The Wii U is far from a very advanced machine compared to current generation consoles, and Nintendo hasn’t sold console hardware at a loss for a long time, both the Wii and GameCube were profitable from day one. And it looks like the Wii U will be profitable for the company on day one as well. Speaking to GameTrailers, Eguchi said, “We would like to avoid taking a loss on the hardware, so we are gonna be seriously considering how it is priced”. Lately, there have been many rumors suggesting Wii U prices anywhere from the very high end of $399 to the lower ends of $199. Nintendo has been losing money over the past few years, and its share price has equally diminished since the Wii reached its peak a few years ago.
With a successful E3 behind them, Nintendo now has a tough job ahead to figure out the right balance between a launch price that will appear to as many gamers as possible, and a price that would ensure the profitability of the console. Microsoft and Sony will almost certainly lower the price of their consoles as a respond to the Wii U when it launches. This will make the Wii U launch price even more important.