Iwata Q&A: Everything Else
A few final responses from Iwata's financial briefing Q&A session.
This is the final installment in my little set of summaries of Satoru Iwata's recent financial briefing Q&A session. I've gotten most of the major responses from the transcript at Nintendo's investor relations site, so I'll just put in a few more bits here and then leave the rest as a surprise for when Nintendo uploads a full English transcript (currently listed at the site as "being prepared").
First off, here are links to the past stories in case you missed anything:
- New Markets
- What does Nintendo think about developing game markets?
- Wii Music
- Does Iwata feel that Wii Music is a failure?
- Wii Shipments and Stock
- Has demand for the Wii dropped?
- Wii Storage
- Nintendo still has plans for that darn storage solution
- Wii in Japan and Abroad
- How does Nintendo plan to revitalize the Japanese console market?
Here are a couple of additional responses. Everything written below was summarized from the transcript. There's no interjection or additional observations from me.
In response to a question about how many hardware units Nintendo hopes to sell over the next fiscal year, Iwata, citing changing marketing conditions, would not give clear numbers. He did say, however, that if Nintendo does nothing, sales will suffer for the coming year because the yen will be high from the start of the year. This is different from the current year which began with a relatively low yen, only increasing suddenly towards the mid term.
Iwata noted, however, that compared to last year, Nintendo will be able to produce more hardware from the start of the year. Some analysts have said that if Nintendo had been able to produce enough hardware, it could have sold three million, or maybe even four million, systems in America over December. Nintendo was unable to realize this, however, because it could not send that many systems over.
It's too early to say how heated the Wii market will be at the year-end sales season this year. But Iwata believes it's his job to make sure that sales do not go down even with the rising yen. In order achieve that, Nintendo will have to consider how to sell the required number of units throughout the world and what type of preparations they should make from the start of the new year.
In another question, someone asked Iwata to comment on what appears to be falling software sales. Iwata reminded everyone of his past statements about games being relatively strong against recessions. However, during bad economic times, the difference between something that sells and something that doesn't sell becomes clearer. The first thing on someone's wish list will sell in both a good and bad economy. However, something that's number 5 or 10 on the list will be affected by the economy.
If you look at the Japanese market's top 100 for last year compared to the year before, the top five for last year sold better than the top five for the year before. However, get down to the middle of the list, and the numbers for last year drop suddenly. This is that difference between things selling and things not selling clearly expressing itself.
One last question. One reporter asked Iwata who exactly is buying the DS. The answer: core gamers who actively seek out game information. These people are the first to act, so initially, the percentage of DSi buyers who already own the DS is high.
For those who think this means the game population is not increasing, those buyers have families, meaning there's a chance of someone in the family inheriting the old DS. So, in reality, they must look not just at the person who directly buys the system, but at these other people as well.
The above was just for the first month of the DSi' sales. Getting into the second month, December, the consumer types expanded greatly to those who do not necessarily seek out game information and don't even look things up in advance at the official website or in catalogues. Retailers were apparently asked quite a bit to explain the differences. Iwata has heard that the number of people who bought the DSi upon actually trying out the system and seeing its charms increased.
The two main reasons people continued to buy the DS Lite following release were because it can play Game Boy Advance games and because it has more colors. Aside from those groups, Iwata heard that a large percentage of people ended up picking up the DSi. Also, of late, he's heard of people who've never experienced the DS before buying the DSi from shops.