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Wii "Are" Number One! Nintendo Nation Rules Video Games

Tuesday, 30 Oct 2007 | 4:41 PM ET
Nintendo
CNBC.com
Nintendo

On the eve of what could be a major shift in Nintendo's family friendly approach to video-gaming, there comes word, courtesy of iSuppli, of just how big the Wii has gotten: how about #1?

ISuppli reports that Nintendo has actually replaced Sony as the number one video game console vendor, surpassing the PlayStation maker in the third quarter, 2007. Worldwide revenue, the market research firm reports, for both Nintendo's Wii and its portable DS, hit $1.2 billion, up a whopping 31.4% from the $943.6 million the company reported the quarter before;; and more than double the $611 million from the same period a year ago.

During the third quarter, Sony reported $1 billion in gaming revenue for PlayStation 3, PlayStation 2 and PlayStation Portable. Microsoft was way back in third position with $317.8 million for Xbox and Xbox 360. Yet, while Nintendo and Microsoft both saw healthy sequential and year over year gains, Sony's sales, surprisingly, were flat. And that's a big problem for them.

Mostly because iSuppli analyst David Carnevale says that "Nintendo is likely to maintain its lead in this area, as it expects by the end of 2007 to ship about 200 additional titles, adding to the more than 150 games already released, many from outside publishers." In other words, the company isn't slowing down any time soon.

One of those titles will generate a lot of attention tomorrow. The ultra-violent Manhunt2 from Rockstar Games will be released for Nintendo Wii on Wednesday. Hardly the kind of family fun the Wii is known for, the title was banned in the UK back in June. Players can even use the nifty Wii hand controller to simulate a stabbing motion to kill characters in the game. How fun!

Seriously, it was bound to happen. As Microsoft moved its Xbox 360 more toward families with last week's "Arcade" version of the platform, it stands to reason that Nintendo would move itself more toward a more mature audience to try to chip into Microsoft's market.

But wow, talk about the sublime to the ridiculous. There probably aren't many titles more violent than this one, so it'll be interesting to see how Nintendo handles all this. The company is preparing a "reactive" statement to the game's release. I called. Check back here and we'll pop it in when we get it. (see update below).
There's some collateral damage here as well: Electronic Arts , banking heavily on the success of the PlayStation platform is apparently losing revenue, iSuppli says. EA reports its earnings this Thursday and this is bound to come up on the conference call.

And it'll also be interesting to see what iSuppli comes up with as far as sales momentum is concerned for the fourth quarter, now that we already know how much better-than-expected Xbox 360 sales appear to be for Microsoft. The company's Entertainment and Device unit, home to Xbox, did a half-billion dollars better than estimates when the company reported earnings last week.

But the story here is as much Nintendo's continuing momentum, as it is Sony's apparent stall in the marketplace.

UPDATE: “Manhunt 2 is not developed or published by Nintendo. It is one of many titles released by third party publishers for our system that appeal to people of all ages and interests. Just as with movies, television, and books, different video games appeal to--and are appropriate for--different audiences.

Video game retailers and purchasers are strongly encouraged to follow the age-specific ESRB ratings when considering what software to sell or buy. If parents are concerned about kids having access to inappropriate Wii games, we encourage them to utilize the PIN-operated Parental Control features built into Wii."

Questions? Comments? TechCheck@cnbc.com

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