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PostHeaderIcon Why Sony sinks and Nintendo continues to swim.

No big surprise here. Sometimes I often wonder why Sony and Microsoft even bother with the console market. I know they both have divisions that make games, but it is not their primary business.

Once upon a time a man would buy a razor and then spend almost nothing on cheap blades. The razor manufacturers never made a lot of money. Then one day a company realized “Hey! Lets give the razor away and make our money on the blades!” This thought revolutionized not only the razor industry, but many others as well.

Nintendo has learned from this lesson. Most Wii games come from Nintendo itself. Xbox and PS games mostly come from other developers. Sure, these developers pay Microsoft and Sony to be allowed to develop for the platform but MS and Sony take huge losses on the hardware, and reap little reward from the software.

Nintendo gives the razor away and sells the blades. MS and Sony charge an arm and a leg for the razor, still take a loss on it, then let others make money selling the blades.

Is there any wonder Sony and Microsoft both have been quoted as saying that consoles are a dead end industry? Both parties want to get out by 2012 unless there is a major change.

I say “Go Nintendo, Go!”

For more information, take a look at:

Sony, Nintendo give dim forecast

As for Nintendo cutting its profit forecast, that is just a smart move. Will make them look all that much better at the end of the next quarter.

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