Mere months after its launch, Nintendo is dropping the price of its 3DS handheld console to counter disappointing sales figures, Nintendo has announced that it will cut the price of the 3DS by nearly one third.
Nintendo revealed the worldwide price-cut as part of its first-quarter financial announcement on Thursday, in a clear attempt to head off a slump in market confidence.
Nintendo reported a first quarter operating loss of ¥37.7bn ($297m) and slashed its annual operating profit forecast to ¥35bn from an initial forecast of ¥175bn.
Announcing the price cut, Nintendo said: "So that we will be able to create momentum for Nintendo 3DS and accelerate its market penetration toward the year-end sales season, when the lineup for the applicable software shall be enriched, the company has decided to make this markdown."
Which is a tacit admission that in its short life so far, the 3DS has suffered from a dearth of killer games. The company took pains to point out that what it sees as the key 3DS games – Super Mario 3D Land and Mario Kart 7 – will go on sale in November and December 2011 respectively.
The problem with reducing the price of consoles – especially so soon after launch – is that it breeds resentment among early adopters who paid the original price. Happily, Nintendo has moved to address such concerns: existing 3DS owners will be able to join what the company calls a Nintendo 3DS Ambassador Programme, entitling them to download 10 NES games plus 10 Game Boy and Game Boy Advance games for free.
All they will need to do to become 3DS Ambassadors is register on the 3DS' eShop before 12 August. Those free NES downloads will start to become available on 1 September, and will at least include stone-cold classics such as Super Mario Bros, Donkey Kong Jr and the original Legend of Zelda.
The free Game Boy Advance games will be made available later in the year, and will include the likes of Yoshi's Island, Super Mario Advance 3, Mario Kart: Super Circuit and Metroid Fusion. They will be exclusive to 3DS Ambassadors, thereby providing a modicum of one-upmanship.
No matter how Nintendo might spin the price cut, there's no getting away from the fact that it is a response to worse-than-expected 3DS sales, which is bad news for the company – over the years, Nintendo has taken pride in setting prices for its hardware which allow it to make a profit on every unit, unlike rivals such as Microsoft and Sony, which have sold their Xbox 360 and PlayStation 3 consoles at a loss early in their life-cycles, in order to establish a foothold in the market.
The free download games will also ease the pain for those who, after 12 August, will feel they paid over the odds for their 3DS consoles. But 3DS sales will come under great scrutiny when this Christmas – the key annual period for games retail – comes around.