Comments on: Could Low Wii Supply Drive Up Demand for Its Competitors?

By: Fiscal Musings » Blog Archive » Weekend Edition: Politics, Giving, Wii and an FMT

Sat, 26 Jan 2008 05:47:04 +0000

[...] gift has certainly garnered most of the attention. I’m speaking here of the Nintendo Wii. And Mrs. Micah goes into a discussion about whether the lack of Wiis will drive demand for other gaming systems. I [...]

By: Weekly Roundup: Spa Edition | My Dollar Plan

Weekly Roundup: Spa Edition | My Dollar Plan — Sat, 22 Dec 2007 14:08:14 +0000

[...] you still can’t find the Wii Mrs. Micah looks at the alternatives and Cash Money Life shows how to earn $1 million by not [...]

By: SavingDiva

SavingDiva — Mon, 17 Dec 2007 15:21:58 +0000

I’m so over the Wii!

By: CatherineL

CatherineL — Sun, 16 Dec 2007 05:02:37 +0000

Hi Mrs M – I am one of those lucky few who managed to get hold of a Wii. My daughter never usually asks for anything expensive – until this year.

We only managed to get hold of one because my husband called the local Tesco and they’d just had 20 delivered. And luckily we didn’t pay over the odds for it.

But, she wouldn’t have minded if we couldn’t get one as she knows all about the shortage anyway.

I think what does suck is that as soon as there is a shortage of these things, people buy them up and sell them on places like ebay for a hefty profit.

By: Andrew Stevens

Andrew Stevens — Sun, 16 Dec 2007 04:25:37 +0000

The person who thought it was hurting Nintendo has good economic instincts. It is not possible that this shortage can help Nintendo, and therefore I seriously doubt that it’s intentional. To explain this simply: the fact that there are people who want to buy the Wii at the price Nintendo is charging, and can’t buy it, indicates that Nintendo could be charging an even higher price so that the quantity demanded declines to a point where there are no such people. But they’re not doing that. Therefore, this can’t be intentional unless Nintendo is run by a bunch of people who don’t know very much about economics or finance, which I highly doubt.

While it’s certainly true that monopolists can sometimes make a larger profit by producing less than the quantity that would be produced in a purely competitive market (and charging a higher price than a purely competitive market would charge), they would still produce enough that anybody who wished to purchase at that price could do so. I.e. there still is no shortage in such cases.

In fact, since Nintendo clearly could be charging a higher price for the Wii right now than they are doing (and make more money thereby), they are intentionally foregoing some profits in order not to lose the goodwill of those people who are lucky enough to be able to buy the Wii now. (If they charged the logical market price, given the amount they’re actually able to produce, these people would be paying a much higher price than people would eventually pay once the shortage disappears. This would likely cause those people to feel “cheated” and they’d probably be quite angry at Nintendo. In my opinion, this is irrational. They’d be paying a higher price for the convenience of having it earlier, i.e. they’re getting exactly what they thought they were getting for their money, but people aren’t rational, by and large, and Nintendo knows this.)

By: Heidi

Heidi — Sun, 16 Dec 2007 00:34:45 +0000

I believe there was a New York Times article on this earlier in the week – it concluded that the shortage is hurting Nintendo.

We have one under our tree – I feel like a little kid – the anticipation is killing me!

By: » Weekly Roundup, Still Shopping Edition on Consumerism Commentary: A Personal Finance Blog

Sun, 16 Dec 2007 00:20:01 +0000

[...] Could Low Wii Supply Drive Up Demand For Its Competitors? [...]

By: mrsmicah

mrsmicah — Sat, 15 Dec 2007 22:38:07 +0000

Like you, piggy bank, I can play pong, pinball, that kind of thing. But I can’t do Halo, Zelda, any of those. I spent a fair amount of time in college watching friends play and enjoying the graphics, strategies, etc.

Wii’s “Wii Play” pack is probably the closest thing I’ve seen to pong and such. I think it even has a pong equivalent. Air hockey, that kinda thing.

Hee hee…it has an updated duck hunt. You get to shoot more than ducks, depending on the level. Another one that I could play back then.

By: PiggyBankBlues

PiggyBankBlues — Sat, 15 Dec 2007 16:25:54 +0000

i was in elementary school when atari came out with pong and it’s honestly the only game i’ve truly enjoyed, which makes me either a neophyte or a geek. probably both

after that i just didn’t find computer games as fun as playing football in the back yard. i enjoy more the technological wonder of it or the graphics, but playing them doesn’t do much for me. i’m sure i’m missing the whole point…

By: Paul

Paul — Sat, 15 Dec 2007 08:24:53 +0000

I personally don’t think that the Wii supply and demand problem is intentional. Even the Nintendo Wii Marketing manager said once that the shortage is “embarassing” for the company. Other reports have said that Nintendo could lose over $1 billion in revenue. I don’t think a company would intentionally lose one. I have been trying very hard to get a Wii myself because it is a lot of fun, but people on Ebay are sure having fun selling them if they were lucky enough to buy one in the store. Wait and the demand will go down eventually and the stores will start stocking them again.