The End of the Wii U

Though wise men at their end know dark is right,

Because their words had forked no lightning they

Do not go gentle into that good night.

Just as the late British poet, Dylan Thomas, wrote about passing in his poem, “Do Not Go Gentle Into That Good Night,” so, to, must we discuss the inevitable passing of the Wii U. Japanese Newspaper, Nikkei reports that Nintendo will cease production of the Wii U. While Nintendo has denied this is the case, it is not unreasonable to believe that the Wii U could end this year as the NX is likely coming out soon. Of course, it’s not like gamers did not see this coming. So, to not let the poor Wii U go gentle into that good night, let us look at the writing on the wall.

Upcoming Titles

Paper Mario: Color Splash was one of the few new Wii U titles shown off during Nintendo’s March 2016 Direct

The Wii U’s end could be easily foreseen by anyone who was paying attention. The most recent Nintendo Direct did not showcase many Wii U game. Besides Star Fox Zero, Star Fox Guard, and Paper Mario Color Splash, the only other Wii U games were ones already released in Japan. Furthermore, all of these games are made by other development studios and teams rather than by Nintendo’s internal development teams. Star Fox is being co-developed by Platinum Games and Paper Mario Color Splash is developed by Intelligent Systems. Even with the 3DS, many of the games coming out are from the company’s other development teams, such as Pokemon Sun and Moon and Kirby: Roboplanet, which seems to be based off of Kirby Triple Deluxe. The only other Wii U game that we know is coming out is The Legend of Zelda. Already, there have been rumblings that the title will be cross released with the NX. It appears clear that, internally, Nintendo has  allocated most of it’s resources from working on the Wii U to working on the NX.

Wii U Weak Performance

Nintendo’s two poorest selling consoles. Original image from: Wiiudaily.com

Nevertheless, it’s hard to really say much about the end of the Wii U without looking at the system’s performance. For those that don’t look at sales reports and financials as much as I do, it may be difficult to quantify the Wii U’s poor performance. To date, the Wii U has sold 12.60 million units worldwide and sold 79.30 million software units worldwide. Compare this to the Nintendo Gamecube, Nintendo’s previous lagging home console, which sold 21.74 million hardware units worldwide and sold 208.57 million software units worldwide. In fairness, the Gamecube was on the market for five years where the Wii U is entering its fourth. As of year-end 2004, the system’s third year on the market, the system sold 18.03 million hardware units and 148.14 million software units. With the Wii U lagging significantly behind the Gamecube, it’s clear the system doesn’t have much time left.

The poor software sales are indicative of the Wii U’s poor overall performance. The system is just a box to sell games, so, in that respect, the Wii U is not achieving its main objective. The poor software sales are due to a lack of third party and first party titles. Late Nintendo President Satoru Iwata indicated Nintendo struggled to garner third party support due to the weak install base. “The larger the installed base or the more it is believed that the installed base will largely expand, there is an aspect that more software publishers are likely to join in.”  In terms of Nintendo’s own games, Miyamoto admitted during an Investor Q&A that Nintendo was not prepared for the transition to HD.

To quantify it, total revenue from Gamecube software sales (at $50) would be approximately $10.43 billion while revenue from Wii U software sales (at $60) would be $4.76 billion, a $5.67 billion difference. Also note that Wii U games were sold for $10 more, so $793 million is due to just the higher price of the Wii U. The poor performance of the Wii U has been a driver of the losses for the company. For the Fiscal year ending March 31, 2014, Nintendo only sold 2.72 million despite originally projecting 9 million in sales, and the company posted a net loss of $229 million. Despite being a typically sound company fiscally, Nintendo has struggled with the Wii U.

Transition to the NX

Iwata holding the Wii (unveiled as the Revolution) during E3 2005

Nintendo has been quiet about the NX, their newest system, yet I believe that a big reason for this is that they do not want to alert consumers that they are ending the Wii U so early. Typically, systems stay around for 5 to 6 years. Even the ill fated Gamecube, released in 2001, wasn’t replaced until 5 years later in 2006. Conversely, the Wii U would be replaced in about 4 years (2012 to 2016), if rumors that the NX is to come out toward the end of this year are to be believed.

While Nintendo is trying to keep the end of the Wii U a secret, Nintendo didn’t try to hide it with the Gamecube. The Wii was announced in 2005, with the system to be released in 2006. At that time, the Gamecube was doing poorly in the market, and Sony and Microsoft were gearing up for their next system with the XBox 360 releasing that year. It was not surprising to see the Wii (codenamed the Revolution) when we did. There was no question that the Gamecube’s time was over. But the NX has been announced since early 2015 when Nintendo announced a partnership with DeNA. However, Nintendo has held back showing off the system. The company refused to showcase it during their 2015 E3 Direct.

Nintendo has been extremely quiet about this system, and I suspect the reason is not to alert customers that the Wii U is ending.  When you’re a business, information like this is very sensitive. With the Wii, Nintendo could reveal their system without much blow back. In contrast, the Wii U is a much more sensitive topic. Nintendo doesn’t want the word to get out that the system is done for because customers would not buy the Wii U and, likely, Wii U games. It’s a delicate balancing act which I suspect has affected how the company handles NX information.

Regardless, many journalist and pundits, including myself, figured the Wii U was at the end of its life. The only thing is Nintendo has yet to officially pull the plug. I doubt it will be much longer; Nomura Securities is expecting the system to released with year and the concept to be shown off between March and May. So here’s to you Wii U. You may not have done well, but you had some good games, and still have a few more to come. If anything, you had the game that helped launch this website: Super Smash Bros for Wii U.

Cheers.