Nintendo's DSi announcement gets negative reception from analysts and investors
Share prices drop, retailers complain
Sometimes it feels like every new console announcement is greeted by a big wave of negativity, and Nintendo's just-announced redesigned DS has been the victim of all the usual criticism, mostly from gamers bemoaning the lack of one feature or another. (Of course, we're not claiming to be the exception – see our feature 'What Nintendo should have included in the DSi').
But Nintendo has more to worry about than a response of apathy from forum dwellers as following the announcement of DSi the company's share price dropped 3.7 per cent.
And it's not only Nintendo which has suffered a poor reaction to the DSi either – the retailers are worried, too.
Edge today reports that analysts have warned investors the system's new downloadable games service could threaten traditional retail outlets.
According to Goldman Sachs analyst Matthew J Fassler, talking to BusinessWeek, the DSi's online store presents a "tangible early threat" to retailers, and predicts that "while content will be limited at first, we believe it will likely ramp up very quickly."
As a result, the price of stocks for retailers such as GameStop and Best Buy also suffered a drop. Gosh, isn't the economy an incestuous beast?
We have faith in Nintendo's ability to fully support the DSi's new features, however much the technology can be criticised for being too weedy (in the case of the camera) or not enough of an upgrade (an SD memory card slot as opposed to a hard-drive), so we're not convinced a small drop in share price (especially in recession-laden times when shareholders don't want to take risks) is necessarily terrible news.
In fact, what's more interesting for us is the prediction Nintendo might quickly ramp up its games download service. If it's got retailers worried, a comprehensive shop of games could well be on the cards, which – in our view – is the only way for the handheld consoles to go if they're going to compete with iPhone, N-Gage and other ever-more-powerful high-end mobile phones. Nintendo's moves online over the coming year should therefore be very interesting.
