Nintendo's focus has seemingly shifted away from its tried-and-true "gameplay before hardware" mantra, and it might be backfiring.
It looks like Nintendo really can't handle direct competition. The DS was not in direct competition with the PSP due to the difference in the kind of games on each platform. One for the young & casual and the latter for hardcore gamers. 3DS is Nintendo's answer to the PSP and PS Vita for that matter but the hardware & software is really lacking to push its 'hardcore games' campaign to victory. And what's worse is the casual department is also left out with no games.
They can handle direct competition just fine. Right now, the biggest obstacles to the 3DS are indirect competition--platforms that don't exist yet, and platforms from the last generation.
Super-inexpensive mobile phone apps are direct competition. Casual gamers have little to no reason to spend $39.99 on a game.
Clearly its doing bad. A $90 price cut with in 5 months of its launch can tell us that much.
this will end becoming a stigma on the gaming industry, it's the second "3d" console that is doing badly...
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