How did Nintendo compete? How did competitors moves affect Nintendo?(please answer this question more than 3/4 page) and Ask a question based on the passage.

CASE 25 NINTENDO'S WII U* With the introduction of the Wii U product, does Nintendo are also nongaming functions, such as the ability to use the have the pieces in place to take control of the gaming GamePad as a television remote. While Nintendo was the market? first of the competitors to release their new gaming con- The Nintendo Wii U console has only been on the sole, there was no doubt that both Sony's PlayStation and market for a short while, with the addition of innova- Microsoft's Xbox would be close behind in releasing their tive controls and new game titles. One of the key areas own upgraded systems. of discussion in the popular press was whether or not the While Nintendo had hopes of becoming the leader in its console defines the "next generation" of gaming. There industry with the Wii U, its initial sales were not what they had been uncertainties among industry experts, such as had anticipated. Its best week was its first. 400,000 Wii U Gabrielle Shrager of Ubisoft and Mikael Haveri of units were sold in the week following its November 18, Frozenbyte, as to whether or not the improved power and 2012, launch date. In Japan 300,000 units were sold in the new controller interface justified the system being consid- console's launch week (see Exhibit 1). Arvind Bhatia, an ered a new generation." analyst from Sterne Agee, believed that Wii U sales at US The Wii U initially launched with approximately 50 megachain retailer GameStop were far below the compa available games and a new controller interface, termed the ny's initial expectations for the holiday season. According GamePad. While the GamePad offered a new take on the to Bhatia, there was no shortage of Wii U units at Game- Wii's controls, the new console was still compatible with Stop outlets, a telltale sign that demand for the console was the same motion-sensing controllers from the original Wii. lacking during the holiday season. Sure enough, come However, the Wii U console was not sold with these con- January and February of 2013, sales dropped dramati- trollers included. Instead, it came with just one of the new cally, at roughly 57,000 and 64,000 units respectively- GamePads. Incorporating traits from tablet devices, the significantly lower than the original Wii sales following GamePad integrates both traditional input methodssuch its launch. This undoubtedly caused worry amongst the as buttons, dual analog sticks, and a D-pad (directional Nintendo team who had experienced huge sales spikes at pad) and a touchscreen. The touchscreen can be used to the introduction of the original Wii. supplement a game by providing alternative functionality Since its release, the Wii had led video games' entrance or an alternative view of a scenario in a game. With the to the cultural mainstream. Neither the Microsoft Xbox Off TV Play function, the screen can also be used to play 360 nor the Sony PlayStation 3 offered the sorts of game a game strictly on the GamePad screen, without the use of controls that could truly appeal to a mass audience, and a television display at all. With the Wii U console turned particularly to families that wanted to have fun together at on, the GamePad can be used to display the same picture home. Only the Wii had intuitive, motion-sensitive game on its screen as would be seen using a TV display. There controllers so gamers could sway the controller around and swing and twist it in space to bowl or evoke some *This case was prepared by Professor Alan B. Eisner and graduate students other action on the screen. With just a little more than Eshai J. Gorshein and Eric S. Engelson of Pace University. This case was 4,000 employees and 2010 revenue of $15.7 billion, Nin- based solely on library research and was developed for class discussion rather than to illustrate either elective or ineffective handling of an administrative tendo was the market leader in video console sales, ahead situation. Copyright 2013 Alan B. Eisner. of Microsoft and Sony. Microsoft had more than 89,000 Region Units Sold Time Period Following Launch EXHIBIT 1 Wii U Launch Week Sales United States United Kingdom First month First weekend 425,000 40,000 638,000+ 1,103,000+ Japan First month Within first month Total employees, and its 2010 revenues were $62.48 billion. console, the PS4, on February 20, 2013. While Sony did Sony had more than 167,900 employees, and its 2010 not show the PS4 at its two-hour event in New York City revenues were over $77 billion. While both Microsoft's that evening, they did say that it would be available in and Sony's revenues were significantly higher, Nintendo is time for the 2013 holiday season. While the next Xbox the only company of the group whose numbers are solely console-presumably named Xbox 720had not been focused on the gaming industry. Both Microsoft and Sony officially confirmed by Microsoft officials, it too was have highly diversified operations, in which gaming plays expected to be released around the holidays of 2013. only a small role. Therefore, when comparing their rev- Nintendo's inability to leap ahead of its competition enues, Nintendo's numbers are much more impressive than can be seen clearly in their financial figures. A they may seem at first glance. Nintendo's revenues and income were off from previous However, by the fall of 2010 the playing field was level, years (see Exhibits 2 and 3). with Sony and Microsoft offering competition for the Wii motion-sensitive controllers. Looking at Kinect from Background Microsoft for the Xbox 360 and the Move system from Although Nintendo dates back to 1889 as a playing-card Sony for PlayStation 3, it was clear that the two leading maker, Nintendo's first video-game competitors had finally caught up with the Wii's lead in oped in 1979 and known as TV Game 15 and TV Game 6. engineering and its ingenious human interface. For almost In 1980 Nintendo developed the first portable LCD video four years, the Wii had reshaped the home-entertainment game with a microprocessor. In 1985 Nintendo created experience. But by 2011, some observers feared that the the Nintendo Entertainment System (NES), an 8-bit video Wii no longer did anything unique that the PS3 or Xbox game console. The original NES was very successful, as its 360 would not do even better. PlayStation 3 and Xbox graphics were superior to any home-based console avail- 360 already had superior graphics to the Wii, and now they able at the time. As a result, more than 60 million units had motion-sensing controllers as well. With the debut were sold worldwide. The NES set the bar for subse- of Nintendo's new generation of consoles, one question quent consoles in platform design, as well as for accer remained uppermost: While Nintendo's Wii U may have games that were manufactured by third-party developers. brought some intriguing improvements to the table, was it when competitors began developing 16-bit devices, such substantial enough to be considered the new generation of as Sega's Genesis system and NEC's PC Engine, Nintendo gaming," and would it encompass innovation that its com- responded with its own 16-bit system, the Super Nintendo petitors would not be able to match or worse-surpass? Entertainment System (SNES). The Super Nintendo was While the original Wii was able to hold on to its lead for a released in 1991 and, when purchased, came with one game, sustained period of time, the initial outlook for the Wii U Super Mario World. In 1996 Nintendo released Nintendo 64. did not look so optimistic, with the release of competing The Nintendo 64 was Nintendo's third-generation video consoles apparently not far behind. game console and was named after the 64-bit processor Not too long after the release of the Wii U, Sony During its product lifetime, more than 30 million Nintendo announced the planned release of their next gaming 64 units were sold worldwide." Go to library tab in 10 Connect to access EXHIBIT 2 Income Statement (Japanese Yen in Millions, except per-share items; year-end March 31) Case Financials. A D E F Income Statement (Japanese Yen in Millions, except per-share items; year-end March 31) 2013 2012 2011 2010 2009 3 Revenue 635,422 647,652 1,014,345 1,434,365 1,838,622 4 Total revenue 635,422 647,652 1,014,345 1,434,365 1,838,622 5 Cost of revenue, total 495,068 493,997 626,379 859,131 1,044,981 6 Gross profit 140,354 153,655 387,966 575,234 793,641 7 Selling/general/administrative expenses, total 176,764 132,170 159,829 169,736 192,725 8 Research & development 53,483 52,614 52.625 45,461 42,211 9 Depreciation/amortization 6,191 4,435 3,469 3,438 10 Unusual expense income) 0 266 (3,057) 589 11 Operating income (36,410) (37,321) 170,811 359,625 554,678 12 Gain (loss) on sale of assets 10 (14) (56) 13 Other, net 3,455 (3,495) 394 1,584 (264) 14 Income before tax 10.197 160,877) 127,936 367,445 448,137 15 Income tax, total 3,029 (17,659) 50,262 138.896 169,134 16 Income after tax 7,168 (43,218) 77,674 228,549 279,003 17 Minority interest 68 13 (50) 91 18 Net income before extraordinary items (43,205) 77,624 228,638 279,094 19 Net income 7,099 (43,205) 77,624 228,636 279,094 7,099 F 2009 756,201 139.174 463,947 132,133 439 12,180 (4,025) 1,648,725 90 Go to library tab in Connect EXHIBIT 3 Balance Sheet (Japanese Yen in Millions; year-end March 31) to access Case Financials. DE Balance Sheet (Japanese Yen in Millions; year-end March 31) 2013 2012 2011 2010 3 Assets 4 Current Assets 5 Cash and deposits 478.761 462,021 812,870 886.995 6 Notes and accounts receivable-trade 45,873 43,378 135,689 131.876 7 Short-term investment securities 424,540 496,301 358,206 365,326 8 Inventories 178,722 78,446 92,713 116,055 9 Deferred tax assets 31,693 16,744 27,620 10 Other 33,094 46,043 42,362 8,528 11 Allowance for doubtful accounts (434) (2.149) (756) (1,067) 12 Total Current Assets 1,192,250 1,140,786 1,468,706 1,591,388 13 Noncurrent Assets 14 Buildings and structures, net 26,351 25,739 27.124 16.037 15 Machinery, equipment and vehicles, net 8,054 13,526 4,851 1,797 16 Tools, furniture and fixtures, net 5,309 4,707 5,787 5,259 17 Land 42,001 41,374 41,606 42,488 18 Construction in progress 4,434 2,508 1,494 14.003 19 Total Property, Land, and Equipment 86,152 87,856 80,864 79,586 20 Intangible Assets 21 Software 8,276 4,801 3,553 949 22 Other 2,586 2,905 1,986 3,162 23 Total Intangible Assets 10,863 7,706 5,539 4,111 24 Investments and Other Assets 25 Investment securities 109,634 66,505 38,228 44,057 26 Deferred tax assets 37,690 57,185 35,017 35,929 27 Other 11,287 8,361 5,940 5.926 28 Allowance for doubtful accounts (0) (13) 29 Total investments and other assets 158,612 132,052 79,187 85,899 30 Total noncurrent assets 255,628 227,615 165,591 169,598 31 Total Assets 1,447,878 1,368,401 1,634,297 1,760,986 16,877 2,195 5,763 42,841 3,386 71,064 751 1,418 2,169 (0) (0) 54,726 29,565 4,530 (14) 88,807 162,042 1,810,767 The Nintendo 64, like its predecessors, used cartridges to play its games, but at the time, the competing Sony and Sega systems were using CDs for game storage. Cartridges could store 64 megabytes of data, while CDs could store around 700 megabytes. Also, CDs were much cheaper to manufac- ture, distribute, and create; the average cost of producing a Nintendo 64 cartridge was $25, compared to 10 cents to produce a CD. Therefore, game producers passed the higher expense to the consumer, which explains why Nintendo 64 games tended to sell for higher prices than Sony PlayStation games. While most Sony PlayStation games rarely exceeded $50, Nintendo 64 titles could reach $70. To increase profits and to take advantage of the programming possibilities of the larger storage space, many third-party game developers that had traditionally supported Nintendo platforms began creating games for systems that used a CD platform (such as the PlayStation).12 In 2001 Nintendo released its GameCube, which was part of the sixth-generation era of video game systems. These systems included Sony's PlayStation 2, Microsoft's Xbox, and Sega's Dreamcast. Although the GameCube did not use cartridges, Nintendo began producing its games using a proprietary optical-disk technology. This tech- nology, while similar in appearance to CDs, was actually smaller in diameter and could not be played using a stan- dard CD player. Genyo Takeda, general manager of Integrated Research and Development for Nintendo, explained that innovation and creativity were fostered by giving several different development teams "free rein to couple a dedicated con- troller or peripheral with a GameCube title and then seeing whether or not the end result was marketable. This project gave rise not only to the Donkey Kong Bongos and the Dancing Stage Mario Mix Action Pad, but also to a num- ber of ideas and designs that would find their way into the Wii Remote."13 When Nintendo released the Wii video game console in 2006, it was already in the midst of a very competitive mar- ket. The previous generation of video game consoles con- sisted of the Sega Dreamcast, Sony PlayStation 2, Nintendo GameCube, and Microsoft Xbox. These systems were all released between 1999 and 2001 in the United States, and although the GameCube sold more systems than the Sega Dreamcast, it fell into third place behind the PlayStation 2 and the Xbox. The PlayStation 2 sold more than 115 million units worldwide, more than twice the combined unit sales of the GameCube and Xbox (21 million and 24 million, respectively). The Term Wii In 2006 Nintendo released its direct successor to the Game- Cube, the Wii (pronouncedwe). There were many reasons cited as to why the name Wii was chosen, but perhaps the most compelling reason was that "Wii' sounded like 'we, which emphasized that the console was for everyone. Wii could be remembered easily by people around the world, no matter what language they spoke. No confusion."*14 Initially the system was known by its code name, Revo- lution, but later the name was changed to Wii Nintendo stated that it wanted to make the Wii a system that would make anyone who tried it talk to his or her friends and neighbors about it." The Making of the Remote The original Wii was created to establish a new standard in game control, using an innovative and unprecedented interface, the Wii Remote. The Wii Remote was what made the Wii unique. The remote acted as the primary con- troller for the Wii. Its motion-sensor capabilities allowed the user to interact with and manipulate objects on the screen by moving and pointing the remote in various direc- tions. The Wii Remote was the size of a traditional remote control, and it was limited only by the game designer's imagination. For example, in a game of tennis, it served as the racket when the user swung his or her arm, while in a shooting game it served as the user's gun. Not only did the remote serve as a controller, but it also had a built-in speaker and a rumble feature for even greater tactile feed- back and game involvement. Exhibit 4 shows the Wii and Wii Remote. The second part of the Wii Remote innovation was the Wii Nunchuk. The Nunchuk was designed to perfectly fit the user's hand, and it connected to the remote at its expan- sion port. The Nunchuk had the same motion-sensing capabilities that the remote had, but it also had an ana- log stick to help the user move his or her characters. The ambidextrous nature of the Wii controllers was something seldom seen in other game controllers; the Wii controllers permitted the user to hold the remote and Nunchuk which- ever way felt most comfortable. In addition to the ana- log stick, the Nunchuk had two buttons that gave the user quick access to other game functions. Thus, the Nunchuk offered some of the benefits of a standard game control- ler coupled with the high-technology motion sensors of the remote. Users could hold a Nunchuk in one hand and the Wii Remote in the other while playing the Wii Sports boxing game and be transported into the boxing ring with on-screen opponents. The game controls were intuitive for jabs and punches; however, a missed block did not hurt as much as if one were really in the boxing ring. While the Wii U is still compatible with the original Wii controllers, Nintendo revamped the controller usability when designing the Wii U. The new GamePad sold with the Wii U allows the user to be more in touch with the game and provides more depth by offering multiperspec- tive capabilities on the Pad's screen. While using the TV display, players can now multitask within a game by using a variety of functions on their controller and can even play using solely the GamePad, with no TV display necessary. With the game console turned on, players have the option to use the GamePad as their main viewing screen, without the need for a TV monitor display (see Exhibit 5). features In addition to the Wii Remote, there were other features unique to the Wii. One was the Wii Menu, which was the first screen that appeared on the television when the Wii was turned on. According to Nintendo, the Wii Menu easily integrated itself into the everyday lives of its users." The menu displayed several different icons; one of them was the Mii Channel (pronounced"me"). This chan- nel gave users the ability to create and personalize a 3-D caricature of themselves. Another icon was the Every- body Votes Channel, which permitted individuals to vote in national and worldwide polls on a variety of topics. There was also the New Channel, which gave the indi- vidual breaking news from around the world, organized EXHIBIT 4 Wii Console and Remote EXHIBIT 5 Wii U GamePad Controller into a variety of topics. The Forecast Channel allowed the Gaining the Interest of Game Developers individual to view weather reports from anywhere around As evident from the history of game consoles, game devel- the world. Users also had the ability to download older Nintendo games from the Wii Shopping Channel. A Wii opers have tried to make games more and more complex with each new generation of systems. This meant that Message Board allowed users to leave messages on the more money was invested in the production of each subse- Wii for other users of the same console or leave reminders for themselves. The Internet Channel allowed individuals quent generation of games. Because game developers were spending more money on developing games, they were at to surf the Internet from their Wii. The Photo Channel great financial risk if games did not succeed. Thus, many allowed the user to view photos stored on a standard SD memory card. And lastly there was the Disc Channel, which developers felt more secure in simply creating sequels to existing games, which in turn restricted innovation. The gave the user the ability to play Wii games or Nintendo Wii's innovative controller, the Wii Remote, required a GameCube disks. The Wii was backward-compatible rethinking and reengineering of the human interface for with the Nintendo GameCube's games, memory cards, and game developers and programmers. Another issue with controllers. developing games for the Wii was that its graphics were not quite as good as those of the PlayStation 3 and Xbox Demographics 360, and therefore game developers were required to be According to Nintendo, one of the key differences between more creative and develop special Wii editions of their the Wii and the competitors' systems was the broad audi- games. ence that the Wii targeted. Many of the Wii games could Many game developers used virtual machine software be played by people of all ages, and the Wii Remote in developing new games. It was believed that game devel- and Nunchuk were easier to use than the complicated opers could develop games for the Wii and then make them controllers of the Sony PlayStation 3 or Microsoft Xbox for other platforms on the basis of the same programming, 360 Nintendo's TV commercials for the Wii showed thereby reducing production costs. However, while the Wii people of different ages and social classes playing the Wii Remote distinguished itself from its competitors, it created According to Nintendo, the Wii Remote allowed people of a hurdle for developers. When developers created a game all ages to enjoy its use. The Wii offered something for both for the PlayStation 3, they could create the same game for the advanced gamer and the person who had never played the Xbox 360 and vice versa. When developers created a a video game before. The advanced gamer would enjoy the game for the Wii, however, it required significant rework remote's unique features, whereas the novice gamer could to deploy the title for the other platforms. Converting a title use the remote as his or her hand and wouldn't need elabo- from the Xbox 360 or PlayStation 3 also required signifi- rate instructions on how to play a new game straight out cant work to modify the game to incorporate code for the of the box. Wii Remote's special features. Although the Nintendo games were easily played by The Wii U's GamePad also has special features that a greater range of ages, the graphics were undoubtedly a should make it less easily compatible with the likes of relative weakness of the product. Thus, while Nintendo Microsoft and Sony. While this has served Nintendo well hoped to target people of all ages, it had long been seen as in the past, it also might limit the selection of games avail- a system that made video games for children, as evident able to the Nintendo audience. The selection of games from its Mario, Zelda, and Donkey Kong series. However, must be fulfilling enough to keep Nintendo's audience despite this limitation, the innovation and uniqueness of its happy, without leaving them feeling that they are missing gameplay was enough to lure the masses, and sales were out on the games available only the other platforms. This excellent. has already been a going concern with the Wii U, as many Success, of course, breeds competition. Upon see- of the currently available games are refurbished versions ing the success of the Movement-sensing Wii, Microsoft of Nintendo classic games, with more to come, such as and Sony moved quickly to release competing systems. Super Mario, Mario Kart, and Zelda 24 Microsoft released its Kinect for the Xbox 360, while Sony released the Move for the PS3. Both the Move and Kinect The Competition use camera systems for their motion detectors, but in the launch of the Wii U and the announcements of com- different ways. Move's camera senses the movement of peting systems by Microsoft the light-up Move controller, whereas Microsoft's Kinect early 2013 were the beginning of the battle for market sensor tracks skeletal motion, eliminating the need for a share in the fierce competition of the eighth generation of controller.25 While it is inevitable that gamers will have video game consoles (see Exhibit 6). their favorite of the bunch, the relevant point here is that The price of $299 for the basic Wii U included the con- it didn't take long for Microsoft and Sony to catch up to sole, the GamePad, and an HDMI cord. The deluxe edition Nintendo. Now they move forward to the new generation(s) priced at $349 included all of the above, plus stands for of gaming on an even playing field for gamer interaction both the console and the GamePad, a charging dock for and motion detection. the GamePad, and the game Nintendo Land 25 While the EXHIBIT 6 Game Systems Comparison, 2013 Nintendo Console name Wii U Microsoft Xbox 360 (with Kinect) Sony PlayStation 4 (with Move and 4 Eye) Blu-ray disc, DVD, CD 8 GB of GDDR5 memory Game format Wii U discs 8GB or 32GB (supports external hard drives) Game discs, DVD, CD 120 GB or 250 GB Hard drive Price Not yet specified $299.99 (8GB) $349.99 (32GB) $199.99 (4GB) $299.99 (4GB with Kinect) $299.99 (250GB) $399.99 (250GB with Kinect) Internet connection Wi-Fi Ethernet, Wi-Fi, Bluetooth Wi-Fi Online services Online game play, HD Blu-ray player, stream movies and TV, optical digital output Online game play, stream HD movies or TV Online game play, WiiConnect24, Wii Channels, stream movies, Miiverse Wii U GamePad, Wii U Pro Controller, Wii Remote/Wii Remote Plus, Nunchuk, Wii Balance Board Controller Xbox 360 Wireless controller, Kinect Sensor Backward compatibility Yes (Wii) DualShock 4 pad: upgraded vibrations, enhanced motion sensors No. Eventually Sony will provide service offering server-side emulation and streaming of old games. Yes (certain Xbox games) Game count Not yet released 782 (including 23 Kinect games) Launched with 23 games, more were announced. (Backward compatible with Wii games) Source: Company reports; Gamestop.com, and author estimates. prices of both the PlayStation 4 and the new Xbox were unknown, at a base price of $299, it appears safe to say that the Wii U is intended to compete with the upper echelon of the next generation of gaming consoles, unlike the low- cost provider position that the original Wii possessed. the Xbox Live Marketplace, totaling more than 8 million members. According to Microsoft, there were more than 12 million downloads in less than a year and, due to this popu- larity, major publishers and other independent gamers had submitted more than 1,000 Xbox Live games.. Xbox 360 Kinect for Xbox 360 The Xbox 360 by Microsoft was released in November in November 2010 Microsoft introduced Kinect for Xbox 2005. While the configurations were changed several 360, which was based around a webcam-style add-on times, the Xbox 360 came in two different prices: $299.99 peripheral for the Xbox 360 console. It enabled users to for the 250 GB model and $199.99 for the 4 GB model as control and interact with the Xbox 360 using gestures and of (2011). However, while its higher-end model was pricier spoken commands without the need to touch a game control- than the Wii, Microsoft was in fact losing money on every ler. Kinect allowed the Xbox 360 to see the user and act Xbox sale, due to costs of production and manufacturing according to the user's motions and gestures. This took the One of the important features of the Xbox 360 was Xbox concept of the Wii and pursued it to its natural culmination, Live. This feature allowed individuals to play online against making the user the game controller. Kinect used software other users from around the world. Thus, Microsoft had technology that enabled advanced gesture created a community of individuals who were able to com- recognition, and voice recognition. Some critics believed municate with one another by voice chats and play against that the concept used by Kinect had potential far beyond each other in a video game. Another service offered by games and might even become a new way of contro Xbox Live was the Xbox Live Marketplace, which enabled computers of all kinds. It automatically identified who one users to download movies, game trailers, game demos, and player was and paused when the player left its vicinity, so it arcade games. It was estimated that more than 70 percent was not hard to imagine this ingenuity controlling all kinds of connected Xbox users were downloading content from of devices, such as a PC, smartphone, or tablet.2 Xbox Next Generation and magnetic sensor to track the controller in three dimen- While little information has been officially released about sions, while the glowing ball at the end gave the PlayStation the next generation Xbox, we can make some assumptions. Eye camera a visual reference for handling aiming. cursor Media outlets have been leading heavy discussion regard ard. movement, and other motion." While Wii's graphics were of ing the consoles' seemingly certain release in time for the release in time for the low resolution and inferior detail, PS3 was a high-definition 2013 holiday season, putting it in direct competition with powerhouse. As one user said, "On the Wii, golf looks like Sony's PlayStation 4. With both Sony and Nintendo mak- a video game. On the PS3, golf looks like a golf course." ing headway in the motion detecting department, Micro- ent. Micro. Moreover, the PS3 played Blu-ray movie discs and could soft will certainly do the same, either improving upon display 3-D images, two things the Wii could not do. Also, its Kinect or investing in a new device, similar to Sony. the PS3 had a full lineup of great traditional games. Sony had Microsoft recently filed a patent relating to projecting shipped 4.1 million units of PlayStation Move worldwide augmented reality 3D images onto the walls of the room in the first two months since its release. Although Sony was you're gaming in, in an effort to more fully immerse you in criticized for merely imitating Wii's technology, it turned out the experience. The code name for this project is Fortaleza" to be a successful imitation." The only obvious difference and has the basis for the Kinect technology at its core. While from Wii was the cost. While the Wii cost $199 and came still speculative, it is supposedly going to work with Wi-Fi with both the Wii Sports and Wil Sports Resort compilations enabled glasses, similar to Google's Project Glass glasses.28 (most buyers also added a second controller for around $40), the PS3 with Move cost twice as much, $400, and came with Sony PlayStation 4 only one game compilation, called Sports Champions. A sec While no pricing has been set, there is a lot that we do ond Move controller cost around $50. The least expensive version of the PlayStation 3, which did not include Move, know about the PlayStation 4. The PS4 will include 8GB of cost $350. Thus, Nintendo and Sony offered comparable GDDR5 memory. This should enable rapid performance. controllers rigged to machines with far different technical Also, Sony has revealed that, using the loading power power and with quite different prices. Despite the signifi- of this memory, you will be able to power down the PS4 midgame, and then later turn it back on and within seconds cant difference in price, however, the Move was a success- ful product offering for Sony. While the 4 Eye is now being be playing again right where you left off. The PS4 will sup- introduced with the PS4, Sony still intends to include and port Blu-ray discs, DVDs, and HDMI output, as well as utilize the Move as well, but to what degree is uncertain. analog and optical digital output. The included controller is the DualShock 4 pad. Its design and function are similar to that of the PS3 controller, but it offers upgraded vibra- PlayStation 4 Eye tions, enhanced motion sensors, and a Vita-like touchpad. This device is a newly developed camera system that Sony revealed that the PS4 would launch with the ability to will be introduced for the first time with the release of stream games directly to the PS Vita, Sony's handheld gam- the PlayStation 4. It utilizes two high-sensitivity cameras ing device. As with the Wii U, this allows you to play on the equipped with wide-angle lenses and 85-degree diagonal tablet controller without the use of a TV display through a angle views. Sony claims that the cameras can cut out wireless connection. As for games, a number of titles have the image of a player from the background, or differen- already been revealed for the PS4 during prelaunch. These tiate between players in the background and foreground, include Diablo III (Blizzard), Driveclub (Evolution Stu- enhancing game play. If it works flawlessly, this would be dios), Final Fantasy (Square Enix), and several others. a significant advancement in the realm of motion-sensing Part of the PlayStation Network's success was the ability gameplay, one that Microsoft and Nintendo may not have to play games online. This allowed individuals to play with the technology to match. There is also speculation that other players located in other parts of the world. The Play- this new technology will include logging in using facial Station Network allowed users to download games, view recognition and using voice and body movements to play movie and game trailers, send text messages, and chat with games more intuitively."" friends, and these capabilities are sure to continue. Mobile Gaming PlayStation Move Recently another form of competition in the gaming In September 2010, Sony released the PlayStation Move, industry has become widely available. Mobile devices which basically copied the Wii's wandlike controller but such as smartphones and tablets allow casual gamers have with more accuracy. As with the Wii, users could wave the the ability to download and play a wide variety of free or Move's controller around and swing it like a bat and hit the ball on the screen. The PlayStation Move combined a video low priced games. The games can be seamlessly down- loaded to the hand-held device. While the interactivity on camera with a physical controller packed with motion- sensing electronics, making it a technological cross between chnological cross between these devices is limited by a lack of controls and features, the Kinect and the Nintendo Wii. The Move Motion Con- the convenience and price factors that they represent are troller, or "wand," combined a gyroscope, accelerometer, something that console makers are starting to notice. nintendo-wit-w-sales-lackluster-al-gam says-analyst/1204653/. 3. Nintendo. 2010. Annual report. March 4. Microsoft. 2010. Annual report. June 30 5. Sony. 2010. Annual report. March 31. 6. Schiesel, S. 2010. A real threat now fac The Future of Wii U While Sony and Microsoft envisioned long-term profits on software sales of PlayStation 3 and Xbox 360, it is worth not- ing that both companies experienced losses producing their seventh-generation consoles. Among the three rivals, Nin- tendo was the only one earning a significant profit margin on each Wii unit sold. According to David Gibson at Macquarie Securities, sales of the Nintendo Wii brought $6 of operat- ing profit per console.While Sony's and Microsoft's gam- ing consoles have commonly been thought of as superior to Nintendo's, perhaps the Wii's simplicity and family-friendly appeal have assisted in its ability to become profitable. These traits attracted not only end users, but game develop- ers as well, allowing the Wii to have the largest selection of games amongst its competitors. Initially there were 235 games for the Nintendo Wii by the end of its release year. By early 2011, however, the total number of games for the Wii was 860, exceeding the total number of games available for ceeding the total number of games available for its main competitor, Xbox 360 (782 games), depending on whether one counted backward compatibility with previous- generation games. The number of games indicates that the Wii was obviously a successful system one that had drawn a good amount of interest from game developers and gamers around the world. However, with Microsoft shipping record number of Kinect units within the first few months of its release, some analysts had started predicting that the Nintendo's domi nance in video-game consoles was over. Microsoft and Sony had started to invade the casual family-user market, a key market for Nintendo's Wii, expanding beyond their former customer base of mainly hardcore gamers. The Xbox and PS3 were becoming more like an entertainment hub for fami- lies. Now, with the Wii U on the market and the introduc- tion of its eighth-generation competitors shortly upon us, the competition seems to be better suited to combat Nintendo. As motion-sensing gamingthe undisputed next best thing" ming the undisputed next best thing to come out of the gaming industry-is a capability that all competitors now encompass, it will be a matter of whose is most desirable to the gaming population and whether or not this solely will determine which system comes out on top. With this technology being widespread across the industry, it may prove to be that much more difficult for Nintendo set itself apart and portray itself as the family-favorite." as it did in its early days with the Wii. To win over the gaming popu lation, can Nintendo rely on its lower price or their quantity of games, or will they have to find a new leg to stand on? With both of its competitors yet to release their next genera tion consoles, perhaps the Wii U can attain a lead by simply being the first to market. 7. Albanesius, Chloe. 2013. Sony Unveils February 20. www.pcmag.com/article2 8. Gomer, Gregory. 2013. 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Stuart, Keith. 2013. Wii Unew Zelda a Is it enough? theguardian. January 24. technologwgamesblog/2013/jan/24ina 25. 2012. Wii Price and Release Date An September 13. wiiu.dcemu.co.uk/Wii- announced-49/879.html 26. Microsoft. 2007. As Xbox LIVE turns wave of social fun. November 13, www press/2007ovo7/11-13XboxLIVEFive 27. Boehret, K. 2010. Xbox Kinect: Just ho Wall Street Journal, November 24, onli 40527487043693045756327235257793 28. Rivington, James. Xbox One release da techradar. www.techradar.com/usews/ xbox-720-release-date-news-and-rumo 29. Rivington, James. PS4 release date, new techradar. www.techradar.com/usews/ ps4-release-date-news-and-features-93 30. Greenwald, W. 2010. Kinect vs. PlaySt control showdown. PC Magazine, Nove article2/0,2817,2372244,00.asp. 31 Schiesel S 2010 A real threat now far