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8/30/2010
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Nintendo To Cut DSi, DSi XL Prices

Responding to tough competition from Apple and other smartphone makers in the handheld gaming market, Nintendo said it will slash $20 from the price of two systems starting September 12.

Nintendo DSi XL
(click image for larger view)
Nintendo DSi XL
Nintendo, which is battling tough competition from Apple and other smartphone makers in the handheld gaming market, is dropping the price of its DSi and DSi XL systems next month. The maker of the Wii video game console said starting Sept. 12, the suggested retail prices would be cut to $150 for the DSi and $170 for the DSi XL. The devices currently sell for $170 and $190, respectively, on Amazon.com. Nintendo said the price of the DS Lite model would remain at $130.

The price cuts come as Nintendo and rival Sony, which makes the PlayStation Portable, are feeling the competitive pressure in the portable gaming market. In April, weak sales of their handhelds were responsible for a majority of the 25% year-over-year drop in overall sales for the video-game industry at U.S. retail stores, according to NPD Group.

Contributing to the decline in sales on portable video-game systems is the growing popularity of gaming on Apple's iPhone and smartphones built using Google's Android operating system, which is used in phones from HTC, Motorola and Samsung. Thousands of inexpensive games are easily available for download through the vendors' respective online application stores. At the beginning of June, games were played by 65% of smartphone users, according to Nielsen. At the same time, smartphones use is growing and is expected to overtake sales of feature phones in the U.S. by next year.

To grab a slice of this market, Sony is reportedly planning to bring its PlayStation brand to the smartphone space. No such plans have come out of Nintendo yet.

In the meantime, Nintendo is starting with price to get more of its portable systems in the hands of consumers. "We know shoppers want to get the maximum value out of every dollar they spend," Cammie Dunaway, executive VP of sales and marketing at Nintendo of America, said in a statement.

More than 1,300 packaged games and more than 200 downloadable games are available for the DSi and DSi XL. While sales are slowing, Nintendo sold a lot of products from the DS family over the years. In the U.S. alone, Nintendo has sold more than 42.3 million units.

FURTHER READING:

PlayStation Phone On The Way From Sony

Smartphones To Usher In Online Paid Content?

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