INTERVIEW - Nintendo upbeat on holiday sales after price cuts

COLOGNE, Germany Thu Aug 18, 2011 3:25am IST

A woman demonstrates an interactive yoga game on Nintendo's Wii Fit, in New York May 19, 2008.     REUTERS/Shannon Stapleton/Files

A woman demonstrates an interactive yoga game on Nintendo's Wii Fit, in New York May 19, 2008.

Credit: Reuters/Shannon Stapleton/Files

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COLOGNE, Germany (Reuters) - Japanese video game maker Nintendo Co Ltd is optimistic about Christmas season sales in Germany after slashing the prices of its Wii home game console and 3DS handheld gaming device, a senior executive told Reuters on Wednesday.

"I think we are very well positioned because both the Wii and Nintendo 3DS have very consumer-friendly prices," Bernd Fakesch, General Manager of Nintendo Germany said in an interview at Gamescom, Europe's largest video game fair.

The company behind the Super Mario franchise announced in July it would cut the price of the 3DS, its latest handheld gaming device, by 40 percent to 15,000 yen ($191.13) in Japan and by nearly one-third in the United States to $169.99, but kept its full-year group sales forecast for the 3DS at 16 million units.

Nintendo launched the 3DS in February to fend off growing competition from other games companies, as well as makers of smartphones and tablets, but a limited selection of new software for the games player led to lower than expected sales.

Fakesch said Nintendo sold more than 200,000 of its handheld 3D-capable gaming device in Japan during the country's recent "obon" summer holidays and said this figure bodes well for holiday season sales in Germany.

"I think last week's sales figures for the 3DS in Japan show what it will be possible for handheld devices to achieve in Germany at Christmas," he said.

"The numbers from Japan show the huge impact that was possible as a result of the price cut and that's what we're predicting for the German market this Christmas too."

He added the price cut would make the product appealing to families as well as hard-core gamers.

Fakesch also was upbeat about holiday season sales of Nintendo's Wii after it slashed the video game console's price to $150 from $200 in May.

"We have seen an enormous increase in sales since then and this gives us another indication of what will happen in the Christmas season," he said.

The device took the industry by storm five years ago by offering motion-based gaming that appealed to a broad audience rather than just core video game fans.

Hit by sluggish sales and a strong yen, Nintendo reported its lowest profit in 27 years in July and slashed its full-year profit forecast far below market expectations.

The weak result confirmed investor fears the video games maker is too focused on hardware when the market is shifting towards software, with games played on the Internet and on smartphones expected to be key drivers of growth.

But Fakesch did not see smartphone gaming as a threat to the console business and added the two could exist parallel to each other.

"Smartphone games, Apps and downloads do us good by making the overall market -- and I'm talking about Germany -- bigger," he said, explaining they made gaming both more socially acceptable and more prominent in society.

(Reporting by Michelle Martin; editing by Andre Grenon)

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