TOKYO Nintendo Co Ltd plans to introduce a new kind of games console and software for emerging markets as early as next year, to capitalize on higher entertainment budgets amidst a growing middle class, its chief executive told Reuters on Thursday.
Satoru Iwata said Nintendo would develop hardware and games oriented towards consumers with lower incomes and less gaming experience than those in developed countries.
Nintendo is searching for new business opportunities as it buckles down and seeks to stem losses on its latest home game console, the Wii U, whose flop has contrasted with blockbuster sales for rival Sony Corp's Playstation 4.
Satoru said there were no plans to launch existing hardware such as the Wii U or 3DS in emerging markets, including China.
"It would be difficult to enter those markets if we didn't create something new... For the mass market you need to provide something that most of the middle class can afford," he said in an interview following an analyst briefing on Thursday.
Iwata declined to elaborate on the design and specification of such a new device and did not specify the countries where it would be sold, saying only that "emerging markets" referred to those whose gaming potential had not yet been cracked.
In China, Iwata said Nintendo would try a different tack to Microsoft Corp. The U.S. rival last month said it would begin selling its Xbox One console through a Chinese partner from September in Shanghai's free trade zone, after the government lifted a ban on the sale of foreign consoles there.
"We think the Chinese market has a lot of potential, but I don't think the lifting of the ban has solved all of the difficulties in entering it. We need to study it more," he said, adding that Nintendo would adjust its pricing to fit consumers in emerging nations.
"For us, Microsoft's approach wouldn't work."
Iwata also said Nintendo will release high-tech figurines of some of its most popular characters in time for Christmas this year. The company hopes the models, which will be able to send and receive data from games, will also stimulate software sales.
But the chief executive said he could not give any more details on a new "non-wearable" platform announced in January that will be oriented towards improving customers' quality of life and encouraging them to stick to healthy pursuits.
Nintendo released its full-year earnings On Wednesday, booking its third year in the red after disappointing sales of its Wii U home games console. It has pinned a return to profit this year on new game titles spurring higher sales of the hardware.
Shares of Nintendo closed 0.7 percent lower on Thursday, compared with a 0.9 percent rise in the benchmark Nikkei index.
(Editing by Christopher Cushing)