The Wii U’s Problem Isn’t Smartphones and Tablets, It’s the (Lack of) Games

The company's holiday lineup is stronger, but strong enough?

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I love the idea of the Wii U: about the size of an Iomega Zip Drive dipped in glossy black — a trifle bigger than the Wii, but still half that of the competition’s comparably desktop-like boxes; a tablet that’s not really a tablet but enough like a tablet to draw you in, then woo you with novel, occasionally fascinating second-screen gameplay; and of course, Nintendo’s stable of iconic characters and franchises and timeless gameplay ideas. No one has Nintendo’s IP or manages to capture that sense of bounding through buoyant, sometimes hallucinogenic, always artful vistas. Not Microsoft, not Sony, not the most beloved indie developers — no one.

But then I look at the Wii U and think about that quote, supposedly from Gandhi, where someone purportedly asked the Indian nationalist what he thought of Western Civilization. The reply: “I think it would be a good idea.”

That’s my reaction to the Wii U for most of 2013 — it would be a good idea, if only Nintendo had the software side of things in hand. Imagine the system a year ago, had Nintendo launched with games as strong and anticipated as The Legend of Zelda: Twilight Princess, a new Super Mario Galaxy, a Super Smash Bros. update or another Metroid Prime. Imagine if third parties had been onboard with the next Okami, World of Goo or Cave Story.

Instead, we got New Super Mario Bros. U and Nintendo Land – not bad, but hardly Super Mario 64-caliber — followed by a slew of middling ports and the odd exclusive standout: LEGO City Undercover, Pikmin 3 and The Wonderful 101. That’s it — a veritable desert of gaming.

So no surprise, Nintendo’s reporting a poor last quarter, marking down an 8 billion yen ($81 million) loss for July through September, which as the Associated Press notes essentially wiped out an 8.6 billion yen profit in the prior quarter.

Itsa-youch, Mario.

Profits only tell part of the story, of course. As Nintendo notes, “The Wii U hardware still has a negative impact on Nintendo’s profits, owing mainly to its markdown in the United States and Europe.”

The company dropped the price of its deluxe Wii U from $350 to $300 during the last week of August, so we’re probably only seeing a month’s worth of sales bump from that: System sales doubled to 300,000 units, up from 160,000 during the prior quarter. It’ll be hard to tell how much that price drop helped Nintendo when its next quarter results come in, since any price-related lift is going to be conflated with holiday sales. In any event, it’s hard to imagine the company making good on its goal of selling nine million Wii U systems for its fiscal year, which ends next March.

The AP assumes the Wii U’s lagging sales are due to “a shift to gaming on smartphones and tablets.” I don’t doubt that’s part of it. But I’m not convinced the lion’s share of people who buy and play the Xboxs, PlayStations and Wiis of the world are shifting en masse to play perennial (read: stuck) chart-toppers like Angry Birds, Plants vs. Zombies, Bejeweled, or today’s numero uno paid game, Duck Dynasty: Battle of the Beards. If smartphones are really killing console gaming (as opposed to complementing it), explain the 3DS. Explain Pokémon X & Y. Explain Animal Crossing. Explain Super Mario 3D Land. And looking past Nintendo, explain an entertainment juggernaut like Grand Theft Auto V, which made over a billion in three days, claiming the title “fastest moneymaking entertainment product” in history (across all genres and mediums)

We’re taking about games that cost $40 to $60 each, not $0.99 or nothing at all. Make every game on Apple’s App Store $40 to $60 and you’d see a better-than-David Copperfield-caliber magic trick as the market vanishes overnight. That gamers are still willing to shell out big bucks for games and set historic records while doing so speaks for itself.

No, the Wii U’s problem isn’t smartphones and tablets, it’s the system’s anemic games lineup, a lineup of mostly middling games with less than a handful of must-haves. That lineup’s looking a little better this holiday than last, but only a little: Wii Party U, The Legend of Zelda: Wind WakerSuper Mario 3D World and Wii Fit U. Even then, one’s a remake, one’s essentially restricted to party gaming, and one’s a fitness suite. The game I was most anticipating – Donkey Kong Country: Tropical Freeze, designed by the folks responsible for the incredible Metroid Prime trilogy — was delayed until February 2014. When I spoke with Nintendo America president Reggie Fils-Aime earlier this week (by phone), he said he thought the company was finally delivering on the software side this holiday. His enthusiasm was contagious. And to be fair, Super Mario 3D World looks pretty terrific, especially if you’re eyeballing its co-op play.

But even were all four of those games critical home runs, gamers are savvier than ever about the big picture, and it’s the big picture that’s a problem for the Wii U right now. Is this game system going to have the sort of games I want to play in a month? Six? A year? How long until a new Metroid? The next big Zelda? What’s my return on investment look like with this thing?

I have a lot of respect for Nintendo as a company. It takes risks no one else will and fails with dignity (see the Virtual Boy and GameCube). It’s not a follower, it’s a company other game-makers follow. But the company is clearly having trouble signing third-party developers for the Wii U, and you can only ask so much of the first-party studios. While I’ve winced each time a notable Wii U games’s been delayed, part of me — the wiser part — recognizes that this is a good thing, the sign of a company unwilling to rush a game out the door to placate shareholders. That said, delayed games are still delayed games. You can’t sell a platform based on promises and hypotheticals, whether to consumers or publishers/developers looking for the install base momentum to justify making or porting a great game to the platform.

On the upside (for Nintendo), the company’s 3DS is the top-selling games system in the U.S. right now, and with the budget 2DS joining the fray alongside a game as anticipated as The Legend of Zelda: A Link Between Worlds, Nintendo could well keep pace (overall) with the PlayStation 4 and Xbox One.

But where that leaves us in 2014 is anyone’s guess, and I expect that sense of uncertainty is what’s on the minds of prospective Wii U owners, weighing the upsides of snatching a system today for its meager assemblage of must-haves against hopes (or doubts) about Nintendo’s ability to deliver in the months and years to come.