Analyst: 3DS games should be $20-$25

“Nintendo needs to change its business fundamentally,” according to industry analyst for M2 Research Billy Pidgeon. Top of Pidgeon’s ideas is a radical cut in 3DS software pricing.

“Nintendo needs to change its business fundamentally. With Wii and DS, Nintendo built large installed bases but failed to energize those bases. Selling in hardware is important, but Nintendo must increase attach rates and third party opportunity dramatically,” Pidgeon told IndustryGamers. “Lower 3DS hardware prices only address part of the problem. It’s more important to sell more software as packaged goods and paid digital downloads to each customer who buys a hardware unit. I would like to see Nintendo cut the retail price of packaged software to a range of $20 to $25 for the 3DS. DS software should be $20 or less.”

This cheaper software is only part of Pidgeon’s proposed solution to Nintendo’s current woes, with a large emphasis needing to be placed on downloadable software too – with the 3DS and Wii U.

“At the same time, Nintendo must increase uptake of paid downloadable software per hardware unit,” Pidgeon added. “And this isn’t just a 3DS problem, this is the problem with Wii, and will be the problem with Wii U unless Nintendo can turn around its attach rate and third party publisher problems.”

Whether or not Nintendo cuts the price of its software remains to be seen but it’s clear the company needs to do something. A recent report revealed that a third of Japanese 3DS owners regret their purchase – a stat Nintendo won’t be happy with.

The 3DS has a huge head start on this handheld generation thanks to the PS Vita’s staggered arrival (it won’t hit the US or Europe until 2012), but first-mover advantage won’t count for anything if no one wants to buy the system. What’s more, Sony’s Vita might not even be the biggest threat, with Apple’s iOS devices currently dominating the casual gaming market.