Analyst sees Wii U price cuts



Posted by Trent Nouveau

Nintendo rolled out its long-awaited Wii U console yesterday, with a white Basic priced at $299 and a black Premium weighing in at $349.



Wedbush Morgan analyst Michael Pachter says he thinks the current price points are appropriate, especially given the high demand from Nintendo's core fanbase. 



However, Pachter also noted that initial pricing would ultimately be too high to sustain demand given the current state of competition from other consoles and tablets.



"In our view, Nintendo was smart to introduce the Wii U at higher price points in order to maximize initial sales from its core audience. We expect 1 - 1.5 million Wii U units to be shipped into the US by the end of GameStop's fiscal year (January)," Pachter wrote in an industry note obtained by CVG.

"We [believe] demand from Nintendo's core fan base [will] remain high through the end of its March 31 fiscal year. Once initial demand begins to subside, we expect Nintendo to lower prices. We don't expect a price cut until summer 2013, at the earliest, but do expect a cut prior to holiday 2013. Any prospective price cut will depend largely on competition, which we expect to materialize in the coming weeks."

Meanwhile, Nintendo of America president Reggie Fils-Aime has confirmed that early Wii U pre-orders are "extremely strong."

"We have a number of retailers taking pre-orders and the feedback that I'm getting from retailers is extremely strong in terms of pre-sales and consumer excitement at the store," Fils-Aime told GamesIndustry.biz.

"In the end, I care about those people. I care about the consumer who's putting money down on a pre-order and whether or not we're presenting a great value to them. Based on some of the reports I'm getting, the answer is yes."



In addition, Fils-Aime claimed he wasn't concerned over the competition from Apple and Amazon, as the Wii U would manage hold its own against the iPhone 5 and new Kindle models this holiday season.

"I'm not concerned about it because that's our responsibility. That's what Nintendo of America has to do, as a sales, marketing and distribution company... We have to own that top of mind awareness with consumers and get them to say, 'Yes, I need to spend my hard earned money on this machine and on its games.' I'm confident we're going to get that job done," he added.