The new Nintendo Wii U gaming console is displayed on a video screen during a news conference at the E3 Gaming Convention in Los Angeles, Tuesday, June 7, 2011.Chris Pizzello/The Associated Press
Nintendo will launch a successor to its Wii game console in the U.S. and other key markets in time for the crucial year-end shopping season later this year, Nintendo President Satoru Iwata told reporters on Thursday.
He said the Wii U would be launched in the United States, Europe, Australia and Japan for the year-end season.
But with cloud-based gaming emerging as a potential threat, Nintendo may have trouble generating excitement about its new product, some analysts say. Google is taking steps into gaming with Google TV, while Apple is thought to be preparing a new iPad and possibly a smart TV that could be game-changers for the industry.
"We think we need to consider the possibility that home consoles could become a thing of the past," Citigroup analyst Soichiro Fukuda wrote in a recent report.
"We think the direction taken by marketing trendsetter Apple will be very important and we will be watching the company's announcements at future events with interest."
Nintendo Co. Ltd. posted a 61-per-cent drop in quarterly operating profit on Thursday and forecast a ¥45-billion ($580-million U.S.) operating loss for the year to March, far worse than market expectations, hit by weak sales the strong yen and its games devices losing ground to gadgets such as Apple's iPhone.
The creator of the Super Mario franchise dominated the video games industry for years with its DS handheld players and Wii home consoles, but is now struggling to keep up as more versatile smartphone and tablet sales boom.
"To say that (the days of consoles) are over is likely an overstatement, but social network and Internet delivered games are growing and structurally changing the future of the industry, which is a strong wind against Nintendo," said Shigeo Sugawara, senior investment manager at Sompo Japan Nipponkoa Asset Management.
"Their time of growth (from consoles) is over, and, while I don't think the company will cease to exist, if they don't move into new categories, they will no doubt lose the great scale they've amassed," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management in Tokyo. '
Nintendo cut its forecast for annual sales of its ageing Wii console to 10 million devices from 12 million, and for the 3DS handheld games device to 14 million from 16 million.
Poor sales forced Nintendo to slash the price of its much-anticipated 3DS handheld games device in August, just six months after its launch.
Nintendo also faces tougher competition in the home console market from Sony Corp's Move and Microsoft Corp's Kinect, and Mr. Iwata said consumers were more eager than ever to seek out bargains in the harsh economic environment.