Nintendo to slash price on the Wii

Nintendo will likely announce a price drop on its popular Wii console by the end of the week.

By the end of the month, Nintendo will drop the price of its best-selling Wii console to just under 200 bucks. That's the rumor coming from the folks over at Engadget, who have gotten their hands on a memo to US retailers. If true, the price cut would be a substantial one – the basic Wii package currently goes for $250 at most stores.

So what's behind the mark-down? Well, for one, the holidays are approaching. Nintendo figures – probably rightly – that the 50 bucks savings will be enough to entice potential buyers who have managed to hold out this long. There's also a question of reigniting interest in the Nintendo Wii.

According to the tracking firm NPD, total video game industry sales have fallen 16 percent to $908.72 million in the past year. And even the Wii, which long trounced rival consoles from Microsoft and Sony, is not immune to the market pressures. Nintendo, for instance, sold 277,000 Wii units in August. That's a solid number, but it's a 39 percent decline over the same time last year.

By comparison, Microsoft sold 215,000 Xbox360 consoles in August, which is a 10 percent increase over the previous year. "Wii unit sales are 50% below last year’s level over the last five months, and we think that September sales will repeat the pattern," Wedbush Morgan Securities analyst Michael Pachter said in an interview with Industry Gamer.

In dropping the price on the Wii, Nintendo is also responding to similar moves from rival manufacturers. In August, Microsoft Corp. announced it would slash the price of the high-end Xbox 360 console by $100, mirroring a $100 cut for Sony's PlayStation 3 last week.

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