Mike Hickey, an analyst for Janco Partners has stated in his latest equity research newsletter that Nintendo need to cut the price of the Wii immediately, due to Sony and Microsoft entering the motion control space this fall.
“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 the Natal and 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; Rock Band anyone?”.
“We expect 3rd party publishers could benefit significantly over the emerging casual cycle, as their prior experience at the casual market was often tortuous from Nintendo’s software domination.”
“The casual hardware extensions from both Sony and Microsoft will likely drive both additional hardware and software sales, for casual and non-gaming mass market opportunities. We expect a potential up-migration from a portion of Nintendo’s Wii market, as many new gaming console households chose to upscale their game entertainment experience, enjoy a broader array of multi-media options and experience “the new” casual gaming opportunities.”
– Janco Partners analyst Mike Hickey