LOS ANGELES--Nintendo Co. (7974.OK), reacting to slow sales of
its latest videogame console and the threat of new competing
hardware, is turning for help to Mario and its other classic
videogame characters.
The Japanese company said it is planning a barrage of new games
in time for the make-or-break holiday season--including the latest
installments of past blockbuster franchises Super Mario 3D, Donkey
Kong, Pikmin, and Legend of Zelda.
Among the many titles planned is a sequel expected in September
to the hit game "Super Mario 3D Land," which is credited with
helping to ignite sales for the company's struggling 3DS handheld
when it was released in November of 2011. This time around, the
company is serving up a new installment on its Wii U console.
In 2014, the company plans to release new versions of its racing
and battle games, "Super Mario Kart" and "Super Smash Bros.,"
pitting many of the company's popular characters against one
another in the first incarnations of those titles for the Wii
U.
Nintendo's blitz aims to resolve what it blames for sluggish
sales of the Wii U since its introduction in November--a lack of
appealing titles exclusive to the new machine.
Nintendo has long argued that consumers will continue to buy
dedicated game machines if the software available is compelling
enough and can't be matched on smartphones and tablet
computers.
"People will buy hardware just to buy a single game if the game
is really attractive," said Nintendo President Satoru Iwata in an
interview earlier this week. "The hurdle has gotten higher, but if
we can clear it, then we think the games can still sell."
Nintendo is competing with more than just smartphone games. It
is also facing new game machines later this year: Microsoft Corp.'s
Xbox One and Sony Corp.'s PlayStation 4. Both companies are also
expected to appeal to their array of exclusive game titles playable
on those machines.
The Wii U has fallen short of Nintendo's expectations since its
November launch. The company originally targeted sales of 5.5
million units in the five months to March, when Nintendo's fiscal
year ends. However, it only sold 3.45 million units, causing a wave
of concern that the quirky game maker was out of touch in a world
increasingly dominated by smartphones.
Shares of Nintendo have fallen 10% over the past year, and are
off more than 80% from what they were during the same time in 2008
-- a difficult period for Japanese exporters because of the yen's
strength. By comparison, shares of Sony have fallen roughly 60%
from what they were in 2008 while Xbox maker Microsoft's stock has
risen nearly 30%.
Nintendo's renewed push comes at a time the industry is in a
harsh period of transition. Worldwide sales of console videogames
are expected to grow 4.2% to $25.98 billion this year, up from
$24.93 billion a year prior, according to the latest estimates from
market researcher PwC. In 2014, sales are expected to rise another
6.4% to $27.62 billion.
That's far less than the 28% growth the industry saw in 2007,
after the last batch of new consoles were released. But it's still
potential relief for game makers, which have seen more than a year
of contractions in sales in the U.S., according to NPD Group.
The Wii U's woes comes on the heels of a lukewarm reception for
the Nintendo 3DS, although there are signs of improvement with
demand for the handheld game system. One factor in Nintendo's
problems, the company has admitted, was a lack of compelling new
titles at each videogame device's launch period, dampening
enthusiasm and incentive for gamers to buy.
In a video message prepared for showing at E3, Mr. Iwata bowed
deeply and apologized.
"After the Wii U launch, we couldn't release games as smoothly
as we have done," said Mr. Iwata. "To those of you that have been
eagerly awaiting these titles, I appreciate your patience."
Nintendo explained that its developers struggled with the
requirements of the new system. What's more, Mr. Iwata said
Nintendo pushed for a more-than-usual refinement of games, so
consumers can justify paying more than $50 for a new Wii U game
when game apps are available for a few dollars.
But he is optimistic that the new titles can turn the console's
initial disappointments around.
"I think there is plenty of opportunity left for the Wii U,"
said Mr. Iwata. We don't think anything has been decided in the
first six months."
Write to Daisuke Wakabayashi at Daisuke.Wakabayashi@wsj.com and
Ian Sherr at Ian.Sherr@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires