There may be more trouble on the horizon for the already slow-selling Wii U. On Friday the prominent semiconductor manufacturer Renesas Electronics posted its quarterly financial report, together with notice of extraordinary loss and a press release about an impending restructuring of the company.
As part of that restructuring Renesas, that merged with NEC Electronics in 2012, announced that it decided to close four semiconductor plants in Japan within 2-3 years, including the state-of-the-art factory based in Tsuruoka, Yamagata Prefecture (as reported by the Wall Street Journal), and this may spell trouble for Nintendo and the Wii U.
The reason is quite simple. The closing factory was responsible for manufacturing the console’s Embedded DRAM, that is quite properly defined the “life stone” of the console.
The production of the 1 cm-wide semiconductor for Nintendo was responsible for more than half of the load of the factory at peak times, but the slow sales of the console determined a reduction in demand and a gap in the usage of the machinery and personnel, forcing the plant to run at a loss.
Nintendo told the Japanese Magazine Weekly Diamond that “the closure of the plant won’t have immediate effects on the production of the Wii U”, but the outlook of things isn’t too positive for the future.
Nintendo could try to contract another company to produce the component, but there are circumstances that make it difficult. According to a Renesas executive the production of that semiconductor was the result of the “secret sauce” and state-of-the-art know-how part of the NEC heritage of the Tsuruoka plant, making production elsewhere difficult. In order to restart mass production in a different factory redesigning the component may be necessary.
In light of the situation an increase in the production costs of the console seems very likely on the medium and long term due to the shift of production to a different location and to the possibility of a redesign of the hardware. One thing is for sure: the Wii U really can’t can’t get a break as of late…
Ah ok. I can't find an option to translate on my ipad but I'll take your word for it.
So nothing about pineapple prices?
No but rice may be going down soon.. oh and something about shutting down five factories in the next three years.. and the company focusing on Automotive Semicondutors... after that my translator wanted 5 bucks a sentence... which isn't happening..
I am a wild and free Ninetails not a trainer.. get over it...
Ah ok. I can't find an option to translate on my ipad but I'll take your word for it.
So nothing about pineapple prices?
No but rice may be going down soon.. oh and something about shutting down five factories in the next three years.. and the company focusing on Automotive Semicondutors... after that my translator wanted 5 bucks a sentence... which isn't happening..
I was more concerned about the egg prices myself, but I can take rice prices, and automotive semiconductors.
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This will only affect Nintendo's pockets, which are plenty deep. I highly doubt the end user will be affected. This isn't why the Wii U is in trouble mind you.
Ya, Nintendo won't just let their EDRAM disappear. If worse comes to worse, they'll just buy whatever they need to, to keep going.
Sure, that's money out of pocket right now, but that may be the only option instead of fiddling around until the facory/company's properties are up for sale and anyone can buy them.
It would actually save them money in the long run just buying it, but that would most likely take longer than 8th generation to see profit from buying the EDRAM properties.
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Topic: The Wii U May Be in Trouble due to Closure of Vital Semiconductor Factory
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