Nintendo: Wii Will Be Profitable Out of the Box

Reggie Fils-Aime has announced that not only will the Wii be a popular game machine for the masses; the Wii will also be profitable-right out of the box. Fils-Aime said to Reuters, "We will make a profit on the entire Wii proposition out of the box–hardware and software. That really is a very different philosophy versus our competitors. We are a company that competes only in the interactive entertainment space, so we have to make a profit on everything we do."

Some software developers are in agreement with Fils-Aime,s strategy for profitability. Brian Farrell, CEO of THQ explained that programming for the Wii had many financial advantages. "It wasn’t a whole new programming environment. So we had a lot of tools and tech that work in that environment. So those costs–and again, I hate these broad generalizations–but they could be as little as a third of the high-end next-gen titles… Maybe the range is a quarter to a half."

The proposition that the Wii will be instantly profitable is a win-win situation for all involved in the business end of the Wii. From the developer,s point of view, the Wii is very similar in programming function to the present gen GameCube, in addition to extremely low buy-in costs of the dev kits–$2000 per unit. This one-two punch means that game companies will recoup and realize profits much sooner. For Nintendo, every game and Wii that is sold means instant profits for the company. If Nintendo holds true to its promise of making quality games that will not break the bank for consumers, Mario and Friends may be soon proclaiming that it has captured the Golden Goose who lays golden eggs-and its name is Wii.


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Author: GamerNode Staff View all posts by

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