PSP World

No Need for Wii HD

Microsoft and Sony promised the future of gaming by offering high-definition graphics with their respective Xbox 360 and PS3 consoles. The video games industry made a lot of noise about the advent of HD graphics, but this seemingly hot sell-point failed to capture the hearts and wallets of consumers as successfully as analysts predicted. Chasing technology was what got Nintendo in trouble with the Gamecube. So this time out, Nintendo had different plans for the Wii. After their hard lessons with the Gamecube, they correctly predicted that not enough households were going to have HDTV in the coming years.

Fast foward 3-4 years later, and it looks like Nintendo made the right decision after all. Market share shifted radically in Nintendo's favor. They were in last place the previous console generation and now is the definitive market leader this generation. Their spot-on prediction that homes were not ready for HD helped them keep the price of the Wii low and generated massive profits. As of March 31, 2009, the Wii has sold 50.39 million units, the Xbox 360 has sold 30.2 million units, and the PS3 22.73 million units.

The sad truth is that Microsoft and Sony might have jumped the gun in their mad console arms race by forcing the introduction of HD gaming before its time. It was only recently on June 12, 2009, nearly four years after Xbox 360 launched, that the US ended analog broadcasting and mandated the Digital Television Transition.

According to findings from Nielsen's National People Meter panel published in May 2009, just one-third (33.3%) of U.S. television homes have an HD set. Of course, HDTV penetration continues to grow every year and is up from 19.3% of Feb 2009. Still, the current data is staggering and reveals how few homes make use of the HD capabilities of their consoles. Some believe UK households will not have 90% HD saturation until 2020.

In an interview with Eurogamer, Epic's Mark Rein said that "Over half the users who played Gears of War 2 so far do not have HDTVs... of the systems that are out there now, the majority of them aren't plugged into HDTVs. So there's no way we're ready for the PlayStation 4 or the Xbox Whatever."

Had Sony and Microsoft been given a sneek peak of the future and known the slow adaptation of HDTV, they might have rethought their console launch strategies. Given the chance to do things over, it doesn't seem the world was ready for PS3 and Xbox 360 -- at least not in their current design.

With rumors of Wii HD ramping up, it seems inevitable that Nintendo will launch such a system. But considering their strong market power, the economic downturn and resultant slow adaptation of HDTV, the Wii is doing just fine in its current form and gives Nintendo little motivation to push out another console. Nintendo has adapted comfortable to Apple's strategy of producing iterative hardware -- which is evidenced by the three different types of DS hardware launched since 2004.

Sony and Microsoft have denied rumors of planning a new console launch in the near future. Analysts believe that when those consoles do come, technology-wise they will be nothing radically different from their current forms. Instead they will perhaps come in a slimmer package like the oft-rumored PS3 slim or feature add-ons like the announced Project Natal, which changes the Xbox 360's interface and control scheme. Will we see Wii HD anytime soon? Unless either Wii sales falter or HDTV prices severely drop, Wii HD may not see the light of day until 2012.

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