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Nintendo must price its newly announced Nintendo Switch as much as $100 under that of the $300 Xbox One and PS4, analyst Michael Pachter has told investors.
“A key determinant of the Nintendo Switch’s success will be pricing,” says Pachter. “With the PS4 and Xbox One both now available starting at $300 each, we believe that Nintendo should offer its new system at $200 or $250 in order to generate interest that stretches beyond its loyal fan base.”
Nintendo said yesterday that it will announce “launch date, product configuration and related specifics,” at some point prior to the planned March 2017 launch.
A $199 price point would seem a little unrealistic given the New 3DS XL is priced the same, a system which is generations behind in terms of graphical performance. A price cut to the 3DS range to around $149 and a $239 launch for Switch could be possible, with extras such as the dock sold separately.
Pricing isn’t the only factor to consider, with Pachter praising what appears to be strong third-party support for the platform.
“The support of so many third-parties, including the largest western publishers, is a clear positive, although Nintendo will likely need to generate a steadily growing installed base early on in order to keep those partners engaged,” he explained. “If it is similar to PS4 and Xbox One, porting should be relatively easy and cost-efficient, which will mean that there should be high-profile third-party games available early on, increasing the system’s popularity.”
Pachter’s report estimates Nintendo will sell one million Switch units in March, with a further five million units in the year beginning April 1, 2017, but will renew estimates when more information is made available.
Source: Wedbush Equity Research
