Wii price cut needed immediately, analyst claims

Despite the last Wii price cut arriving as recently as last September, one analyst has claimed that nintendo needs to drastically reduce Wii’s RRP as soon as possible or else face market share erosions at the hands of Microsoft’s Natal and Sony’s PS3 Motion Controller.

Nintendo built the majority of their casual mass market oriented installed base from a $250 price point,” Janco Partners’ Mike Hickey told IndustryGamers.

We believe Nintendo needs to cut the price of their console from $200 to $150 immediately, as they should establish as meaningful of an installed base as possible before theNataland Arc are introduced.

We believe they also need to generate strong hardware sales momentum into their competitors release or face the draconian consumer perception of the Wii having a dramatically reduced entertainment value proposition over a faded technology innovation.

We expect continued market weakness through ’10 for Nintendo related products, as the Wii cycle fades meaningfully and the DS platform faces considerable competition from Apple related mobile gaming devices.”

Furthermore, Hickey believes that there’s still room for growth for both Xbox 360 and PS3 – though again, he reckons that further hardware price cuts are needed.

We acknowledge that a traditional hardware cycle would now be nearing completion, leaving further market growth dependent on continued and aggressive hardware price cuts, software price cuts, hardware extensions and an economic lift,” he continued.

We remain optimistic for near term PS3 and 360 market growth opportunities, vis–vis an emerging secondary casual market cycle, as accessory innovations potentially target an established Nintendo casual market.

We think console manufactures need to dramatically cut price points in calendar ’10, to continue hardware sales momentum from the holiday.However, we expect Microsoft will not cut the price of their hardware in front of the introduction ofNatalmotion technology this holiday, as they are likely hesitant to offer a price induced inflection point for their installed base growth, favouring a hardware innovation as a more sound medium term sales catalyst.”

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