Analyst Firm Concerned That Wii U Will "Lack Broad Appeal"
Posted by Thomas Whitehead
Believes Sony and Microsoft successors are due this year
Last week saw the annual tech hoopla of Consumer Electronics Association (CES) 2013, with a number of gadgets such as the Nvidia Project Shield handheld unveiled. Although not all major technology companies were in attendance, it was an opportunity for various contacts to be made and for industry analysts to seek vital information.
Baird Equity Research is one such firm that spent CES "with a number of companies involved in video game development and distribution", and issued its latest predictions and interpretations of what's coming in the game console industry. As a clear example of how analysts and their firms don't always agree, Baird's thoughts on Nintendo countered the fairly positive Wii U predictions from International Data Corporation.
We remain concerned that Nintendo's innovative Wii-U console will lack broad appeal beyond the core Nintendo fan base.
Following a somewhat lackluster launch and holiday selling season, Nintendo will need to bring to market major first-party releases (Zelda) and retain the support of key third-party developers to reduce market share losses. In a negative scenario, Nintendo will be forced to prematurely lower the Wii-U price, and over the course of this cycle, we expect consideration will be given to extending first party franchises to other platforms.
We've heard the claims that Nintendo may take its franchises to other systems before — smartphones are often mentioned — while the mention of a price reduction will certainly bring to mind the 3DS cut and related Ambassador Programme offered to early adopters. In terms of Nintendo's competitors, the firm anticipates Microsoft's successor in November and an October launch for Sony's system, though there "may be early production issues with Sony's PS4."
Two different outlooks on offer from analyst companies, both of whom are undoubtedly paid good money and make it their business to get ahead of what's coming in the industry. Where do you stand? Do you agree with IDC that Wii U will "find an audience" and hit 50 million sales by the end of 2016, or do you agree more with Baird Equity Research's belief that the system could "lack broad appeal"? Let us know in the comments below.