Nintendo’s Wii Sells Out Fast in Japan

More than 3,000 people lined up outside Bic Camera in downtown Tokyo, waiting to get their hands on the new Wii video game system by Nintendo. But the store had to start turning people away an hour before the doors even opened, because the Wiis were all sold out "for the foreseeable future," according to a spokeswoman.

The revolutionary new gaming system made its debut in the United States last month and sold out nationwide within a few hours. When it hit Japanese stores Saturday, it was greeted by long lineups and shortages. Some major retailers had to call on extra crowd-control staff with megaphones to prevent stampedes of customers trying to get their hands on a game console.

Nintendo’s ambitious hopes for Wii are for it to challenge the powerful hold of Sony Corp. and Microsoft Corp. in the consumer game console market. Wii already has one advantage over its rivals because of its price. In the U.S., the Wii sells for $250, which is about half the price of Sony’s PlayStation 3, which sells for roughly $500-600 depending on the model. The Xbox 360, which launched last year, sells for $300-400.

Nintendo’s Wii is a revolutionary new gaming system that puts the emphasis on simplicity rather than fancy graphics and monster computers. Wii features a remote-control wand that can be swung like a tennis racket, cast like a fishing pole, or waved like an orchestra baton, giving the gamer access to easy-to-play games with a realistic feel.

The company hopes Wii’s featured games will appeal to a wider audience than the traditional young male demographic that the big name gaming companies usually go after. That goal is particularly important in Japan, where the game industry’s growth has been sluggish in recent years due to an aging population.

Industry analysts expect that Wii will offer some serious competition to Sony’s 70% market share, which it accumulated from the sales of previous PlayStation consoles. Sony has sold more than 200 million PlayStations since the gaming system was introduced. But Nomura Securities analyst Yuta Sakurai said last month that he expected Nintendo to sell 40 million Wii machines—compared with Sony’s projected sales of 70 million PlayStation 3 consoles over the next five years.

Even more critical than the number of sales is the profit Nintendo will be making from its Wii. Sony is already expecting to go into the red by at least $1.7 billion for the fiscal year ending next March, due to the hefty startup costs for PlayStation 3. By contrast, Nintendo is forecasting a profit of $845 million for the fiscal year, thanks to Wii boosting earnings in the second half of the year.

The icing on the cake for Nintendo is that they also have more machines available for sale. Nearly 400,000 Wiis were manufactured in advance of the launch date in Japan, and shoppers in the U.S. bought up more than 600,000 Wiis in the week after its launch there. Sony paled by comparison, offering only 100,000 PlayStation 3s in Japan and 400,000 consoles in the U.S. when they debuted there last month. PlayStation’s European launch has been pushed out to March because of production problems.