Nintendo Wii Sales Begin to Flatline

For the second year in a row, Nintendo Wii sales have fallen at a faster pace than expected.

When you sell 70 million consoles worldwide, there comes a point when there really isn’t anywhere to go but down.  But unfortunately for Nintendo, sales of the Wii have declined at a faster than anticipated rate, according to reports obtained by Bloomberg.

The unit is still dominating the market share, and the saturation of the Wiis into homes has been nothing short of extraordinary. The console did its job, propelling Nintendo back into the public after the disappointment of its previous systems, and you might think that Nintendo execs should be happy to high five each other for a job well done. But the declining numbers could be part of a bigger issues.

The sales are slowing at a faster rate than analysts had forecast. A drop of 13 percent last fiscal year followed an 18 percent drop the year before, indicate that there is a bigger problem than simple oversaturation of the market. With Sony and Microsoft still selling units at a steady pace (and the PS3 actually increasing in sales), Nintendo is slowly losing ground. It still has a huge lead of roughly a 30 million units, but that number is shrinking.

The bigger issue: Why the sales are decreasing faster than expected? Analysts knew the numbers would decline, but the bigger-than-expected decline is a result of people falling out of love with the concept of the Wii. It was always an underpowered system with inherent limits when compared to the PlayStaiton 3, and the Xbox 360, but it was fun, and people liked it. But now that the Wii is in its third year, the novelty is wearing thin, and the poor selection of games is beginning to show.

Third-party developers do not like the Wii. The tools are different from those used to develop on the PS3 and the 360, and those tools do not lend themselves to developing Wii titles easily. Of the top 10 most sold games on the Wii, all 10 are either made by Nintendo, or with Nintendo, and only one third-party developer cracks the top 15 on Wii sales. Originally, the Wii thrived because of two things: its appeal both gamers and non-gamers, and its price.  The number of non-gamers was always limited, and most have already purchased the Wii if they intended to,while the more hardcore gamers were always a tough sell for the Wii, and falling prices and better selections have swayed most to Nintendo’s rivals.

Make no mistake, the Wii is still the king of the consoles, but its armor is beginning to rust.