Wii U launch: Reactions mixed, software already discounted

The launch of a new console provides a moment of clarity and reality after months of pre-release hype and speculation. The future of the Wii U is still wide open, with much depending on Nintendo's ability to improve the system's software, release compelling games, and convince third party publishers to support the console with impressive software. Some things are already happening, though, which may give some indication of the Wii U's future prospects.

First of all, the Wii U is already sold out at retailers across North America, according to reports. Over 2500 units have appeared on eBay already, though, at prices from $400 to $500 as some early buyers attempt to cash in. This sounds like there's solid demand, yet it's not as fevered as the demand for the Wii after its launch in 2006. The (then) $250 Wii console was selling for well over $1,000 on eBay well into 2007, and it was many months before supplies caught up with demand for the Wii.

Something unprecedented has occurred during this new console launch: Two major retail chains are offering discounts on Wii U software. This has never happened before at the launch of a new console, according to industry veterans. Toys R Us is running a sale: Buy one Wii U title, get the next at 40 percent off. Target is running a similar sale: Buy two Wii U titles, get the third at 50 percent off. Those prices mean the retailer is essentially giving up all profits on the software it is selling. Does this mean these retailers are trying to attract hardware buyers for the Wii U? Or are the retailers just concerned that Wii U software isn't going to sell all that well, and worry about being stuck with hard-to-sell inventory?

“It's going to be a tough retail season, and given the increasing Black-Friday driven shopping culture, this is a tactic designed to ensure that the store in question is the primary shopping source for the Wii U,” said Scott Steinberg of TechSavvy Global. “If they get you in the door to buy Wii U software at a discount, chances are you're going to do all your Wii U shopping at that specific retailer.”

"If they get you in the door to buy Wii U software at a discount, chances are you're going to do all your Wii U shopping at that specific retailer"

Scott Steinberg

The retail struggle in a soft game market is more intense this year than ever before. “This is certainly a first in history, and it points to the state of the retail and set-top console market,” said Steinberg. “In the past you would never see retailers discounting premium launch software for a console system. In most cases it's an opportunity to mark prices up. But I struggle to remember the last time a console launch had so much software available.”

Michael Pachter, senior analyst with Wedbush Securities, agrees that this promotion is being driven by the needs of retailers rather than any perceived weakness in the Wii U. “Keep in mind that they don't have many Wii U hardware units, and that the total shipped to the US is probably well under 1 million for the launch, so their risk is that they sell 100,000 or so titles at no profit,” Pachter said. “It's a loss leader to drive traffic. I don't think it's a signal about the health of console sales at all.”

The Wii U may be sold out for the moment, but the early buzz on the console is mixed. Some reviewers gave the console an Incomplete, since many of the Wii U's features were unavailable until a last-minute firmware patch was delivered just before launch (too late for reviewers). Others liked the Wii U, but almost all reviewers agreed that the full potential of the Wii U remains to be unlocked. None of the launch titles seemed to be destined for classic, console-defining status similar to Super Mario Bros. or Super Mario 64.

The Wii U is in limited supply for the moment, but the true test of its selling power will come when you find it easy to walk into a store and buy one. The competition looks daunting; both the PS3 and the Xbox 360 will be available this weekend for $199, which includes a 250 GB hard drive and several games. That's an advantage of hundreds of dollars over a Wii U (counting the cost of software) that's roughly equivalent in graphics power; the PS3 and the Xbox 360 have robust libraries of software (many at lower prices for classics or used software) and proven online communities and extensive arrays of entertainment, low-cost downloadable games, and other features.

The Wii had two distinct advantages at launch; it was half the price of competing consoles (though it lacked the processing power and HD output), and it had a unique, easy-to-grasp interface with the Wiimote motion control. The Wii was readily understandable by anyone in the family, regardless of prior game experience. Grandma could grab a Wiimote and bowl or play tennis readily.

"Nintendo has set up the Wii U for failure"

Dan Hsu, GamesBeat

The Wii U, by contrast, lacks both of the Wii's advantages. The Wii U is more expensive than the PS3 or the Xbox 360, yet it offers no clear graphics advantage. The GamePad has a daunting array of buttons and sticks as well as a touchscreen interface; Grandma will not pick this up as easily as a Wiimote. The interesting possibilities of two-screen gaming require time and explanation or demonstration, and it's not clear yet that two-screen gaming alone is a reason to spend over $100 extra on the Wii U versus competing consoles.

Those who already own a PS3 or an Xbox 360 may not feel compelled to buy a Wii U unless they are huge Nintendo fans. Right now the Wii U's advantages are more potential than actual. When an amazing Zelda game comes along, or a Donkey Kong Country, or some other title that takes amazing advantage of the GamePad, then you'll see the hardcore gamers line up to get a Wii U.

For those who don't already own a console system, or perhaps only own a Wii, the situation is more complicated. The Wii U is much more capable than a Wii, but also more complicated. Families with a limited budget will probably also look at the possibility of getting a tablet like the Kindle Fire HD, the Nexus 7 or an iPad Mini - all of which can be had for less than a Wii U. Tablets may not offer the same immersive gaming experiences as consoles, but casual gamers won't know or care about that. What they will see is that tablets can do many useful things for the family, and are completely portable, and have thousands of free games and other apps. That's a powerful indirect competitor for often limited family budgets.

The story of the Wii U won't necessarily be told this year, as Nintendo may well be able to sell all the Wii U systems it can supply to retailers. The picture will get clearer next year as availability of the hardware increases and additional games become available.

"Wii U has major potential and if Nintendo plays their cards right, the system can become a major player, especially once the media capabilities and game options are fully stocked"

Dan Milano, ABC News

The following Wii U review roundup provides a summary of what both mainstream media and gaming media are saying about the Wii U:

New York Times: “I have no idea what the Wii U augurs, or whether it will permanently alter how we play, alone or together.”

USA Today: 3 out of 4 stars. “Until we see Nintendo Network fully functioning with the TVii service and additional games that take advantage of the GamePad, it's hard to say whether Wii U recaptures the console magic.”

ABC: “Wii U has major potential and if Nintendo plays their cards right, the system can become a major player, especially once the media capabilities and game options are fully stocked.”

Time: “The Wii U already feels like a much more robust and fascinating idea, one that shows even more promise, in my opinion, than the Wii did in 2006.”

Polygon: 6.5 out of 10. “We are cautious and indeed, somewhat pessimistic, about what the future holds for Nintendo's new system. The Wii U is poised to deliver the same thing Nintendo always has, but we're still waiting to see if it can deliver more.”

1UP: “All in all, Wii U won't blow anyone's mind with its hardware capabilities, and it will definitely annoy hardcore A/V fanatics with its lack of output options. The system's horsepower puts it on par with current consoles, which will be true for... a year, probably.”

GamesBeat: Editor Dan Hsu feels that “Nintendo has set up the Wii U for failure.” He cites the initial price, the fact that the hardcore content is all old, there's no killer app, and the Pro controller buttons aren't properly placed for hardcore gamers.

CNET: No rating yet. “Despite its unique dual-screen presentation, innovative GamePad controller, and ambitious Nintendo TVii service, the Wii U still has a lot to prove.”

Engadget: “Without Nintendo Network, Miiverse, Nintendo TVii, or any streaming / on-demand video content -- not to mention promised backwards compatibility -- the Wii U doesn't compete at all with even last-gen consoles (Xbox 360 and PlayStation 3 just became last-gen, in case that isn't clear).”

Kotaku: “Give it a month or three. Wait until the "launch window" closes at the end of March and the likes of Pikmin 3, Lego City Undercover and a slew of interesting download-only games are available.”

The Verge: 7.0 “I don't know which future awaits the Wii U. But until it's obvious, I'm not buying one.”