SURPRISE: Handheld market still breathes
Let’s rewind back to April 2011. Nintendo 3DS has been out in the market for nearly a month and things aren’t looking too rosy for the successor to the best-selling handheld to date, Nintendo DS. Many professionals in the industry are already proclaiming that this is it for the handheld market as we once knew it. It’s time to pull the plug. Fast-forward back to the present. The 3DS is still on store shelves. Nintendo has moved as many as 17 million 3DS units in a little over a year and the 3DS has outsold the DS by about a 1 million units in their respective first 14 months in the market. Dead much?
Now all eyes are on the Playstation Vita which has been on the market for some 3 months. Not much unlike Nintendo 3DS in its first months out, Vita too is struggling. Really struggling. A week ago, Sony revealed that it’s sold a pathetic 1.8 million units. But that’s no longer important. What’s important is this: what to do next?
What worked for Nintendo is a 30% price reduction and a much-needed influx of new quality software releases. Is that what the Vita needs as well? A price cut is pretty much guaranteed following weeks and weeks of stagnant and disappointing sales in all three regions. However, what makes it improbable in the eyes of many a pundit is Sony’s recent announcement of a record loss for the last financial year. They simply can’t afford any more losses. But what Sony also revealed was its projections for the Vita – 10 million sold by the end of the fiscal year next March. Now, Sony must be smoking some really good shit, or they have something big up their sleeves.
New game announcements for the Vita are heavily anticipated for Sony’s E3 press conference early next month. That’s the one thing the handheld severely lacks. But even if Sony manages to release spectacular Vita versions of Killzone, Call of Duty, and the like, it still isn’t enough. Definitely not enough to reach that very high 10 million. The only other solution that would work well at this point is cutting the price, everybody knows that. Then again, such a move would anger the investors even more, as Sony would most likely be forced to sell Vita systems at a loss. So Sony is better off with no price cut then? No, wrong!
Sony needs to do whatever is needed to move more Vita units, even if that means selling the Vita (which is part of an otherwise healthy Playstation division, the only bright spot in Sony’s current product portfolio) at a loss. The reason lies in the developers. If there are not enough Vita systems in the hands of consumers, why develop for it? 1.8 million is most certainly not enough. And with no exciting titles on the horizon, what else, other than the double-edged price cut, can turn the consumer’s eye away from the 3DS or iPad in the needed time?
Also, don’t expect Sony to just magically procure headline breaking Vita game announcements at E3 in June. If that is what Sony has in store for us at its press conference, it either promised huge amounts of money to the developers, or a Vita price cut. It doesn’t take a genius to figure out which of the two was Sony’s carrot.
Say Sony announces a price cut and a slate of eye-popping Vita games, will that do it? Will that set the system on the right course? That’s impossible to tell. But if it worked for Nintendo, why shouldn’t it for Sony? With Apple close to announcing the next iteration of iPhone and Sony as desperate to turn the situation around as ever, it really does seem to be the best way to go forward at this point. It’s the shortest straw, yes, but still a straw.
One thing is for certain, though: Handhelds are still very much alive.