Nintendo admits the iPhone and iPod hurt their sales

Nintendo was making a killing with their Wii and DSi, but with the slowed economy and increased competition their cash cow products are no longer spewing out money. It seems that they have seen their profits fall 66 percent this quarter over last year. During a conference call they attributed this decline in sales to competition from the Apple iPod and iPhone, not the Sony PSP which is its direct competitor. The added pressure from the Apple products are expected to cause their 2010 profits to drop as well.

Nintendo didn’t outline any new strategy or plans to compete against the iPod and iPhone as they came out of no where to steal their market share. After the launch of Apple’s App Store it brought an influx of games for the iPod and the iPhone which shifted Apple’s attention to helping their developers and creating more game friendly hardware. This unintentionally brought Apple into the mobile video game market and in direct competition with Nintendo and their DS and DSi. The iPhone and iPod touch had better graphics than the DS and the cost of games were much lower than the average DS game, which also stole many customers away from Nintendo. The DSi included a camera, music player and web support and was thought of as a response to the iPhones and iPods, but it is obvious now that has not had much effect. What can Nintendo do to stop this onslaught from Nintendo? My suggestions, make the next Nintendo DS all touchscreen, add better Wi-Fi, a video recorder, a larger hard drive and make the games downloadable as well.

-Ray