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Hints That 2015 Is The Swan Song For Nintendo's Wii U

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Hints That 2015 Is The Swan Song For Nintendo's Wii U
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Virtually every major character and franchise -- Mario, Zelda, Star Fox, Yoshi, Kirby, Smash Bros., etc. -- will arrive on Wii U by the end of 2015.

Nintendo (OTC: NTDOY) could surely delay some of those games and save them for a later date, or develop something entirely new for the following year. Thus far, however, it seems that Wii U's lineup will be nearly complete in 2015.

This is bound to make consumers wonder if the next Nintendo console could arrive in 2016 -- just four years after Wii U's release.

"Four years is so close," Christine Arrington, Senior Games Analyst at IHS Electronics & Media (NYSE: IHS), told Benzinga. "It seems to me that the kind of rumors and talk about a cheaper version for emerging markets seems like a better way to go."

Related Link: GameStop Hardware Sales up 81% On Xbox One And PS4

Arrington said that Nintendo is good at speaking to a younger audience. She also noted that the company tends to focus on the toy side of gaming. That was particularly apparent this week when Nintendo unveiled Amiibo, its first line of game-connected action figures.

"I think there's a hole in emerging markets," said Arrington, referring to Nintendo's plans to expand globally. "So that seems to be a better way to go than trying to launch an entirely new console in four years."

The Five-Year Cycle

Traditionally, game consoles work on a five-year cycle. The SNES, N64 and GameCube were each released five years apart. PlayStation 2 arrived five years after the first PlayStation.

Hardware makers attempted to stretch the last generation and dragged things out for a few more years. But it should be noted that Microsoft released Xbox 360 a mere four years after the original Xbox, which had struggled at retail. That strategy paid off: Xbox 360 went on to sell 81 million units -- more than three times as many as its predecessor.

Nintendo also has a history of dumping hardware that underperforms. The company famously dropped the Virtual Boy less than one year after its release.

That doesn't mean that Nintendo will drop Wii U. The console experienced a notable sales boost after Mario Kart 8 arrived. If that boost does not last, however, Nintendo might be tempted to look ahead to a future generation.

For those who yearn for new concepts and new hardware, that might actually be a good thing.

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.

Latest Ratings for NTDOY

DateFirmActionFromTo
Oct 2016NomuraUpgradesNeutralBuy
Sep 2016Deutsche BankUpgradesHoldBuy
Jan 2015Bank of AmericaInitiates Coverage onUnderperform

View More Analyst Ratings for NTDOY
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Posted-In: Amiibo Christine Arrington comments GameCube IHS Electronics & MediaAnalyst Color Rumors Analyst Ratings Best of Benzinga

 

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