Nintendo even more of a bargin now
- I picked my Platinum edition up last night from Circuit City, only
$105 with tax for this powerful little box of gaming fun.
Japanese video game company Nintendo (news - web sites) Co. Ltd.
(7974.OS) on Wednesday cut the U.S. price of its flagging GameCube
game console by a third as it looks to build momentum for the crucial
Nintendo said the price cut to $99 from $149, which had been widely
expected by game publishers and financial analysts, would take effect
The move makes the GameCube $80 cheaper than its two competitors,
Sony Corp (news - web sites).'s (6758.T) market-leading PlayStation 2
(news - web sites) and Microsoft Corp.'s (Nasdaq:MSFT - news) second-
place Xbox (news - web sites), both of which start at $179.
"Under $100 is the magic price point for consoles, we believe, and we
didn't think there was any value in going to an interim step" like
$129, George Harrison, Nintendo of America senior vice president of
marketing, told Reuters.
The cut to $99 also makes the GameCube the same price as the
company's Game Boy Advance SP handheld device, which dominates the
portable gaming market.
A number of game publishers have curtailed or ended production of
GameCube games, citing the platform's disappointing sales. Analysts
were quick to caution that Nintendo was likely to benefit most from
"Although this is a positive announcement with respect to Nintendo,
we do not expect this price drop to have a dramatic effect on our
expectations for the third-party publishers in our universe," Harris
Nesbitt Gerard analyst Edward Williams said in a note.
Of the 10 best-selling games for the GameCube in August, according to
research service NPDFunworld, six were published by Nintendo -- a far
higher proportion of first-party games than on any other console.
STRONG INTERNATIONALLY, WEAK IN U.S.
While the console has been stronger in Japan and Europe, in the
United States it has settled into a firm third place, with an
installed base about 29 percent smaller than that of the Xbox.
The last major game console to retail for $99 in the United States
was Sega Corp.'s (7964.T) Dreamcast (news - web sites) -- though that
price was an inventory-clearing move after Sega discontinued the
console and decided to become exclusively a game publisher.
Nintendo earlier this year said it had stopped production of the
GameCube because of an inventory backlog, but Harrison said
production would start up again later this fall. He declined to say,
though, if Wednesday's price move foreshadowed the coming of a
successor to the GameCube.
"What we've said about the next console is the work is under way and
we would be launching at the same time as our competitors," Harrison
said. Harrison also said the fact that gamers could buy a GameCube
and three games for the same price as a PS2 with no games made it a
more compelling value for the holidays.
Both Sony and Microsoft have announced special bundle packages for
the holiday season that involve free games, offers that ran counter
to widespread industry hopes that the hardware makers would cut their
"We do not expect Sony or Microsoft to follow suit with hardware
price cuts but instead remain committed to the hardware/software
bundle programs each has already announced," Williams said.