Details from Iwata’s Q&A session – reasons behind 3DS price cut, salary reduction for Iwata, third-parties, importance of digital, much more
Following Nintendo’s Q1 2011 financial results, Nintendo and Satoru Iwata have just wrapped up an earnings briefing in Tokyo. Iwata spoke to investors about a number of topics, ranging from Wii U to salary cuts for the Nintendo president himself and other executives.
As you would expect, the 3DS was also discussed in great detail. Iwata touched on the the system’s new price point and one of the reasons behind the decision is actually quite interesting. Iwata explained that Nintendo felt that they missed out on an opportunity with the GameCube and didn’t want to make the same mistake with 3DS. That’s just one of a few explanations that were provided.
For more on the 3DS price drop and the briefing in general, read on below.
– Increase install base ahead of big 3DS games
– Sends a message to developers/retailers
– Iwata taking responsibility for 3DS
– Iwata seeing a 50% salary cut
– Other executives seeing 30% price cut and reduced bonuses
– Nintendo wants to regain trust by letting the 3DS recover
– No conclusion yet on the impact of SNS, but believes there’s no correlation between the growth of SNS and decrease of Nintendo sales
– Looking to combine social and real networks, synergise and maximise, aiming for new software this fiscal year and next
– Need to deliver game experiences that mobile phones can’t offer
– One retailer in the U.S. said the 3DS price cut makes it “feel like Christmas is already here”
– Original DS at 15000yen was not profitable and 3ds is further unprofitable, as volume expands cost down effect
– Plan very soon to announce strategy for combination of digital and packaged and synergy between the two
– Nintendo admits they haven’t expanded in the digital area and that’s what they’re aiming for; trial and error has been done so far
– Nintendo strongly aiming on digital side for 3DS/Wii U
– Not worried about people getting tired from 3D
– Some software will be made where 3D isn’t the focus, possibly through digital means
– No plans to sell IP on other platforms
– Need to be more flexible and work with other platforms and use them
– Nintendo says hardware and software brings value
– No share buy-back as short term
– Focused on long term
– Shareholder return will come from improvement to the 3DS by year end
– Wii U not limited to the television
– Nintendo feels Wii U is a dramatic change from Wii
– Nintendo believes TVs will be online and connect to smartphones
– Just 3D won’t provide satisfaction on the 3DS as other features are important
– Nintendo missed out on a price cut opportunity for GameCube which impacted decision to lower the 3DS price
– Cash balance enables decision for the price cut
– Business is shifting towards third-party reliance, which is something Nintendo hopes to strengthen
