Topic: Making the Wii U ... FREE?

Hey, I just had a conversation with a few friends about making the Wii U FREE or a very little sum like 50,-. Sounds ridiculous yeah but how many games until the Wii U would've been profitable? 5? Do you think the economists would have something against a business measure like this?

The idea behind this is simple, if you had the CHEAPEST (by far) of all consoles, even if selling at loss initially, wouldn't you automatically have A HUGE install base that would come with bigger 3rd party support churning out many games which would again result in more sales across the platform since you have such a huge install base, probably lots of players that didn't have anything Nintendo in the past years and would have renewed interest in Nintendos franchises?

I know... I know...
but lets discuss, what do you think?

This is just one of the many reasons why some people don't run businesses.

Everything should be free but that will never happen

So basically you're saying they should give up on making money on the console not just early in its life but for the entire console. Yeah, that's not a good plan. The only way to do that would be to instead charge people a subscription fee and make your money back that way. The better option, if that was the intent which it isn't, would be to pull out of the console race entirely and become a third party dev.

What they could do is start selling a separate box with HDMI out on the back, 1080p upscaling and a bit of flash. Make it really cheap and connect it to your NNID... then have it just play VC games via a unified account system. That would be a good third product which you could sell for "free" with $80 of eShop credit.

I don't know why i'm doing this, but ...
... if you make the price too low there's no telling if people really are interested in the games at all. Many might just buy it because it's cheap and buy maybe one game for it. Sounds like trouble there, don't it?

I hate to oversimplify, but it sounds like this strategy would boil down to making the consoles extremely cheap and then regaining the revenue by maximising software sales.

I'm pretty sure that's what Atari did in the 70's :/

Hey everyone look, living proof humans can live without brains!

Wow, thanks to those who put in some effort and thought, how many of the others become more and more like the people on IGN is stunning.
We (the people here and me) started this discussion because we read about how little of importance the initial profit with console-sales is compared to the profit generated from software-attach-rate over the lifespan of a console, thats how we got that idea. The same (similar) principle worked with smartphones, huge install base (not due to little price but general appeal and reliance on such devices) thus lots and lots of growth in the mobile games market.

Anyways, keep sharing your thoughts and please keep your insults!

Seemingly its even easier to live without manners.

Naturally yes but with that small price tag the Wii U would probably become a secondary console (or even tertiary) in more households than it would than otherwise. And of course the huge install base would be a good argument negotiating with third parties.

Still the money generated from selling the base unit over the whole lifespan of a console has a considerable little role to play in the overall profits if you could guarantee 10 or 20 million bigger install base, especially if you could get all those tablet and mobile casual games into the eShop for little money, the customers that usually wouldn't have gotten the console could then consume the same kind of rubbish games they're used to, generating revenue. But again, it's just theory.

Care to clarify?

That's a very different market there, mister. Smartphones and tablet computers are not primarily bought for games. There are also more firms producing these than there are console manufacturers. _{More bankrupts too i'd reckon.}

Yes that was my argument, the whole app and gaming thing started because someone smelled a business there with a smartphone being in nearly everyone's pocket. That the primary use for such devices is not gaming is clear, I just meant if you could, by SOME way (like literally giving them away for free) create a huge Wii U installbase by people who are only even remotely interested in a gaming console would the market for games (especially eShop games) open up similar than they did on the mobile devices. Thats all im pondering.

Reverse-thinking: Do you think we would have that ridiculous growth in mobile and casual gaming if the install-base of smartphones and tablets would (for whatever reason) be only a third of what they are?

Breaking it down even simpler:
Lets assume most people already HAVE an i-device or android-based device VS people HAVE to buy a console first (that basicly does mostly just one thing, games)

If many people now already had a Wii U, for whatever reason, wouldn't it develop similary?

You're asking to make the console free: a deed which is impossible. Manufacturing costs a lot of money.

But if you're talking about making games free and using the "Freemium" model, then I suggest:

1) Changing the title o the thread

2) Whoever made TANK TANK TANK is already doing so.

This is one of those ideas that makes sense on paper but doesn't fly in the business world though. If you gave everyone in the world a free Wii-U, only the people who have an interest in gaming would go and, well, buy games for it. It's the same for smartphones - there are a lot of people who just don't get any games. I don't think everyone who gets their free WiiU will suddenly be compelled to go and buy games just because someone gave them a free WiiU. A price drop, at the moment, does make sense, but dropping the price to free or to something incredibly low completely unbalances Nintendo's revenue streams.

I think because the WiiU's install base at the moment seems quite small, somehow making the install base larger would seem like an easy solution. There's a lot of other things which need to be considered though. Most egregiously, if Nintendo sold each console for about 200 dollars loss (because they're selling them for pretty sharp profit margins as it is), their games would need to be jacked up a good fifty dollars each assuming that people will buy the same amount of games regardless of their price. Except consumers won't pay for horribly overpriced games, even if the system was given to them for virtually nothing.

I wish I could make some graphs here, but I won't waste any more of your time

What other purpose than gaming does the Wii U really have? So that when people realize they're not really interested in the games atm won't just unplug it and store, sell or dump it somewhere?

Most people might, just might buy enough games break even if Nintnedo is lucky. They will take a loss that's too big, too any casuals would sign on to this, buy 2-3 games and never look at Wii U again. Most people who would buy a number of games for his/her will already pay a few hundred dollars to get it.

Thank you for further thoughtful input. I guess the software-attachement won't be vastly different indeed thus not breaking even or even overcoming the initial loss. Hmm. So lets think this further, what way - no matter how plausible to reality or really happening - could Nintendo widen their install base in a relatively short amount of time. Sure, with the Wii it was that trademark motion control thingy, which is now a thing of the past in a way. The gamepad really does not have that wide mass-appeal. I really hope for something at Nintendo's E3 Nintendo Direct that shows some use for the gamepad that makes people go "dahell thats only possible on Wii U, its awesome" - but unfortunately I doubt it and can't think of any other way "wowing" people to instantly get a Wii U.

Even with Mario Kart and Mario 3D on the way, those games are hard to "convert" people to Nintendofans that never were.

Well, if the software attachment rate was high enough maybe it would be justifiable at $150.