Nintendo sees life yet in the Wii

LOS ANGELES Wed Jun 16, 2010 8:41pm EDT

1 of 3. Attendees wait in line at the Nintendo display at the E3 Media & Business Summit in Los Angeles on June 15, 2010.

Credit: Reuters/Phil McCarten

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LOS ANGELES (Reuters) - Nintendo Co Ltd, confident that its Wii will stand up against rivals Microsoft Corp and Sony Corp, says it feels no pressure to reinvent the pioneering motion-sensing games platform.

President Satoru Iwata said that despite decelerating sales growth, there is life yet in the Wii and that updates of popular games like Metroid, Donkey Kong and Wii Party will keep it moving off store shelves.

But Nintendo keenly understands the importance of getting third-party game developers on board early, much like the participation enjoyed by the 3DS -- the 3D-capable mobile gaming device announced on Tuesday.

"I do not think that there is an immediate need to replace the Wii console. But of course, at some point in the future, the need will arise," Iwata said through a translator on the sidelines of the E3 video game conference in Los Angeles.

"We currently do not have an answer as to what point in the future that need will come."

The Wii -- which employs a stick-like controller that doubles as everything from a tennis racket to a baseball bat in games -- popularized motion gaming and has brought casual users into the gaming population in past years.

But that success was hard-won, Iwata said.

"When we first launched the DS and the Wii, very few people thought that we would have the success that we have had so far. Because of that, Nintendo had no choice but to try to create that market for those two platforms ourselves," he said.

"So when that time comes (for us to release a new platform) and we are able to garner third-party support coupled with our own properties, we will be able to create a very healthy environment for that platform."

Nintendo on Tuesday took the wraps off a new version of its DS handheld device that can play games and show movies in 3D without glasses, as the hardware wars with Microsoft and Sony Corp heat up.

LET THE GAMES BEGIN

On Monday, Microsoft said it will begin selling its "Kinect" motion-sensing game system on November 4.

On Tuesday, Sony announced that its Move motion-sensing platform -- which will compete with the Wii and Kinect -- will begin selling on September 15.

The Japanese company rode strong demand for the Wii and DS handheld game player to three straight years of record profits through March 2009, but growth slowed last year after Sony and Microsoft cut console prices and beefed up their software offerings.

Microsoft's foray into motion sensing is, like the Wii, targeted at casual gamers, and is aimed at bringing more of the household into the gaming population, broadening the market beyond the traditional core of young males.

But some like Signal Hill analyst Todd Greenwald argue that blockbuster sales of games like Ubisoft's "Tom Clancy's Splinter Cell: Conviction" or Take Two Interactive's "Red Dead Redemption" prove the sustained momentum in sales lies more with hardcore players.

That's particularly true as the economy makes casual gamers think twice about buying a console, Greenwald said.

"The reason to buy a Wii has changed dramatically over the past six months or so," he said. "The people who are still buying games are the hardcore-type gamer, and that hardcore gamer is going to buy a 360 or PS3."

"I would say that Microsoft and Sony should get a pretty big boost over the next six months or so versus the Wii."

Nintendo last month forecast a second straight year of smaller profits.

To cheer shareholders, Nintendo has considered a share buyback, but only if a specific need arises.

"(A buyback) is something that we do take into consideration and may do as the need arises," Iwata said.

But the company would not discuss its plans in public.

According to consultants NPD, six of the top 10 games sold last year in the United States were for the Wii, and all were developed by Nintendo, which further boosts its coffers. The top Nintendo Wii game was "New Super Mario Bros Wii."

In response to a question about growing sales of Sony's PlayStation 3, Reggie Fils-Aime, Nintendo of America President, said: "It is easy to talk about growth when you are working off of a very low base."

"The fact is that when you look at the absolute number for units sold, it is clear that the pace is dramatically better than either of our competitors," he said. "The absolute level of sales has been widening in our favor."

Nintendo said new games for the Wii in coming months include updates to its own franchise hits such as "Legend of Zelda" and "Donkey Kong," as well as "Just Dance 2" from Ubisoft, and a new James Bond game from Activision's "GoldenEye" series.

(Reporting by Franklin Paul; editing by Phil Berlowitz)

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