Nintendo has stated that it plans to sell its new Wii U console at a loss, at least for the first few months of its launch. This comes after the latest profit forecast.
This means that the Japanese company will sell the new hardware at a value below the production cost. The longer-term strategy for the company is that they intend to recover money through the sale of add-ons and games. This comes from a statement called a 'Presentation by the President'.
This is the first time that the company has manufactured any of its hardware devices without the aim of making a profit and brings Nintendo more in line with Sony and Microsoft in relation to new hardware: sell now, make money later. A number of new games are emerging for the Wii U.
The move also reflects the realities of the gaming industry where the 'big three' need have new product out at regular intervals in order to stay competitive. However, the frequency of the launches does not off-set well against the cost of R&D or the cost of production.
The Wii U is an upcoming video game console from Nintendo as the successor to the Wii. The Wii U features a new controller, called the Wii U GamePad, with an embedded touchscreen. The controller allows a player to continue playing games by displaying the game even when the television is off.
Nintendo posted its first ever annual loss in April, as the Digital Journal reported, and is set, according to the BBC, to make a relatively low net profit of 6 billion yen ($75 million) in the current business year. The small turn around is due to the earlier launch of the popular 3DS games console.