After getting off to an inauspicious start, the Nintendo 3DS reversed its fortune by the end of 2011.
Nintendo announced today that it sold 4 million 3DS units in the U.S. last year, helping it to edge out total sales of the regular DS family of devices, which hit 3.4 million during the period. According to Nintendo, the handset, which launched in the U.S. in March, outpaced Wii sales during its first nine months on American store shelves.
Just months ago, there was no telling how the 3DS would survive an inordinately difficult U.S. market. In July, Nintendo announced that it sold only 710,000 3DS units worldwide during the three-month period ended June 30. What's worse, just 110,000 of those units were sold in the U.S.
Nintendo announced at the time that it was cutting its 3DS price from $249.99 to $169.99 in an attempt to motivate "anyone who was on the fence about buying a 3DS" to finally dole out cash for the portable. The move worked. In August--the same month Nintendo cut the 3DS' price--sales were up a whopping 260 percent in the U.S.
But Nintendo's 3DS troubles have gone far beyond just sales. As Nintendo chief Satoru Iwata said back in April, his company is having an extremely tough time trying to sell customers on a technology that displays 3D content without the need for special glasses.
"The value of 3D images without the need for special glasses is hard to be understood through the existing media," Iwata said during a financial results briefing. "However, we have found that people cannot feel it just by trying out a device, rather, some might even misestimate it when experiencing the images in an improper fashion. This makes it more important to give people more opportunities for appropriate experiences of glassless 3D images."
Plus, there's the issue of smartphones. Currently, devices like Apple's iPhone or the countless Android-based smartphones on the market support application stores that come with mobile games. Many of those titles are both compelling and cheap. Even better, they're running on devices that can do much more than the 3DS, including, well, making phone calls.
Consumers have grown so fond of playing games on their smartphones that between 2009 and 2011, Nintendo's portable game software revenue market share dropped from 70 percent to 36 percent. Android and iOS smartphones, meanwhile, saw their market share jump from 19 percent to 58 percent.
So, what does 2012 look like for the 3DS? Nintendo is optimistic. The company plans to launch new Mario Party, Pokemon, and Kid Icarus titles this year, and it'll get some help from third-party developers with Resident Evil Revelations and Metal Gear Solid 3D: Snake Eater.
The only question is, will Nintendo be able to fend off the continuing smartphone onslaught?