Strategy of slashing prices helps to lift video-game makers out of sales slump

Article Abstract:

Video game manufacturers have cut prices for their products, and are on the verge of a possible recovery. Nintendo Co and Sega Enterprises Ltd are lowering their prices for 16-bit video game systems from $199.95 and $149.95, respectively, to $99. Analysts estimate that the two companies will sell a total of 16 to 17 million game systems in 1992, as opposed to the 12 million that were sold in 1991. The recession has favored sales of lower-priced toys, which is another reason for price cuts. Some analysts say that increased sales of video games could lower sales of traditional toys, particularly boys' toys, but others say that if more video games are sold, more conventional toys will be sold also. According to retailers, sales have also been boosted by increased interest in the new 16-bit games, which feature larger characters.

Industry Overview, Sales, Price cutting, Industry Analysis, Outlook

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For video games, now it's a battle of bits

Article Abstract:

Video game makers come to the Consumer Electronics Show, held in Las Vegas, NV, in Jan 1990, intent on taking market share from industry leader Nintendo Co. NEC Corp and Sega Enterprises Ltd, the two main challengers, are depending on the new 16-bit video game machines that are twice as powerful as Nintendo's eight-bit system. NEC is using 16-bit technology to add realism to video games by transforming animation into motion pictures. NEC is previewing a game called 'It Came From the Desert,' which demonstrates the company's movie-style images. Sega is using 16-bit technology in games that simulate flying, race car driving and submarine navigating. A Nintendo spokesman dismisses rumors that Nintendo, too, is working on a 16-bit system. Intriguing video games, not powerful machines, are the secret to success, says Nintendo.

Consumer electronics, NEC Corp., Consumer Electronics Show, 1989 AD, 16-Bit, Video Games

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Nintendo, Sega zap prices as video-game war heats up

Article Abstract:

Nintendo Co and Sega Enterprises Ltd both cut prices on their top-of-the-line video game systems in an effort to spur slumping sales. Analysts place most of the blame for the sales slump on market saturation. They say that 37 percent of US families own a video game system, and not many more are interested in buying one. The trick for Sega and Nintendo is to get current owners to upgrade from the 8-bit generation to the current 16-bit generation. To accomplish this, Nintendo reduced prices on its Super NES system $30 to $149.95, and Sega cut $20 off the price of its Genesis system to $129.95. Both makers are vying for market share of the game systems, because a large base of systems means more sales opportunities for game cartridges in the future.

Competition, Marketing Strategy, Video Game Systems, Pricing Policy

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