Nintendo according to Bloomberg is having hard times trying to turn a profit in the gaming market as experts are cited the release of smartphone gaming devices as part of the problem.
The Japanese giant already has made announcements that its current home gaming console the Wii price will drop for the holidays to $130 in America to make way for its next generation console Wii U that is set for a November release date with a starting price of $300 and $350.
The company said that the new Wii U will be operating at a loss. In a press conference last month Senior Managing Director Yoshiro Mori said.
"Manufacturing costs are expensive, and we priced the machine at a level customers would accept. It's important for us to develop a healthy business next fiscal year by combining sales of hardware and software."
While Haruka Mori a Tokyo-based analyst at Barclays Plc said in a report that Nintendo's profits next fiscal year "hinge on the sustainability of the Wii U's momentum after the New Year.
Nintendo has stated they have taken a 43.2 billion-yen loss last fiscal year and was forced to cut the price of its handheld game the Nintendo 3DS to around the $150 to $200 mark.
Nintendo isn't the only video game company having problems of their own, Sony another Japanese base company who is rumored to be in the works of building their next generation console the Playstation 4 are encountering difficulties.
Playstation UK's Fergal Gara said in a statement.
"We do have a challenge to manage the next generation of consoles, particularly in terms of dev studio resources. The more platforms you have, and the amount of rich content you have to deliver on all the systems you are supporting clearly puts pressure on decisions made across the studio network, which is something we are battling with."
Smartphones like the iPhone 5 and Samsung Galaxy S III are looking to make a push into traditional gaming markets along with the likes of Apple's iPad line.
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