Last Updated Jan 28, 2011 11:16 AM EST
Microsoft Kinect is stealing the Wii market
Nintendo's Wii sales for this year aren't bad, even with a projected drop from 17.5 million to 16 million units. But it is a drop, and when compared to the competition, Nintendo's lead is shortening quickly.
For that, they can thank the Microsoft (MSFT) Kinect, which uses motion-based controls without the controller the Wii requires. I was skeptical about the technology, but, as BNET's Erik Sherman noted last fall, the Kinect is a blockbuster: It sold a million units in 10 days and, at last count, moved 8 million devices.
Equally problematic, the Wii has limited uses. While the Wii technology was groundbreaking in 2006, Nintendo hasn't improved the technology in nearly five years nor licensed the technology to companies so others can innovate. (The games themselves have been equally lackluster, getting the average lowest ratings compared to the Microsoft XBox 360 and Sony (SNE) PlayStation 3).
Compare this with the Kinect, which is probably only second to Android for the number and diversity of uses right now:
- Microsoft adding motion controls to its PCs and tablets
- Pornographers making interactive adult games
- 3D visuals are the next step for Kinect
3D isn't enough to sell the Nintendo 3DS
But there are issues here, too, and that became clear last week when the company announced the details. Nintendo 3DS specs alone aren't enough to sell the portable console. The problems:
- No cheap software, especially compared with Apple (APPL) iPhone
- No significant game included with the expensive device
- No major graphics partners from the console side
First, 3D is already available on other devices, including Apple's. For instance, Spatial View 3D has a free, thin slider that slips onto the iPod or iPhone and allows 3D viewing without glasses, and a virtual store with free and paid 3D content. Expect Apple itself to take 3D into heavy consideration, especially as it preps for the iPad 2, iPhone 5, and the next iPod line for later this year. There is also an army of 3D phones launching this year: Sharp (SRP) just released two 3D phones and LG will be announcing a line of 3D phones in two weeks.
Second, long-time Nintendo rival Sony is making its portable console games compatible with the Android mobile. Gamers now have incentive not only to purchase Google (GOOG) Android devices, but to wait for Sony's powerful NGP device this holiday season. Nintendo does not have any comparable allies.
Nintendo has had an excellent four-year run with the Wii and has been the dominant mobile company for twice as long, but now it really has to reevaluate where it belongs within the home and portable console marketplace.
- Nintendo Sold 30 Million Wiis in the U.S., but Its Motion Is Slowing
- Sony's Sexy, Smart NGP Portable: Odds Against Apple Better With Android
- Microsoft's Kinect Turns Into a Blockbuster
- Nintendo 3DS Will Launch in March, But Strategy Needs Revamp Now
- Verizon iPhone: A Serious Threat to Sony, Nintendo
- Why Apple Should Be Worried About Sharp's 3D Android Phones