Wii-hunters told to shop now before winter demand heats up

NEW YORK (AP) Each holiday season, a couple hard-to-find toys send parents hunting from store to store. And, each season, they're soon forgotten: Has your Elmo gotten any tickles lately?

An employee fetches games for customers buying Wii video game consoles at the Nintendo World store in New York's Rockefeller Center last summer. AP PHOTO

But this year it looks like the gift everybody is looking for is the same as last year: the Nintendo Wii.

A year after its launch, the small video game console sells out almost immediately when it reaches stores, even after Nintendo Co. has ramped up production several times.

"Right now, if you work at it, it's not too hard," said John Lawrence, of Fort Worth, Texas, who bought a Wii a few weeks ago for his 9-year-old grandson. It took him some online sleuthing to find one at a local GameStop.

"People have not gotten into the Christmas shopping mode. Once people get into that mind-set, this is going to be an impossibility, as it was last year," Lawrence said.

With the Wii, Nintendo set out make a console that would entice people who were not hardcore gamers, and it has succeeded. Janet Presti stood an hour in line at the Nintendo World Store in New York last week to get a Wii for her three children, but it wasn't just for them.

"I played it at my sister's house and I loved it," she said. Her household already has three game consoles: a Microsoft Xbox 360, a Sony PlayStation 2 and a Nintendo GameCube.

The Wii responds to the user moving the wandlike wireless controller, while other consoles are controlled by a confusing array of buttons and joysticks. It also comes with an array of casual, nonviolent games that appeal to adults.

Sony and Microsoft cut the prices of their consoles this fall, but continuing demand for the Wii has meant Nintendo hasn't had to.

Perrin Kaplan, vice president of marketing and corporate affairs at Nintendo of America, said the console was "priced right from the beginning." A look at eBay shows that Kaplan may be wrong: New Wii systems are selling about $100 above the $250 store price.

Some of the demand for Wiis results from trouble in the toy industry, as well as the gadget's cross-generational appeal.

"No one is buying toys right now because of the recalls," said Gerrick Johnson, a toy industry analyst at BMO Capital Markets.

First, toys were recalled because of lead paint and dangerous magnets. Then, Aqua Dots — colored beads that were making their way to must-have status — were pulled because they were coated with a chemical that turned into the date-rape drug gamma hydroxy butyrate if swallowed.

"It's really unfortunate for the toy industry, because the lead issue was starting to subside, was getting off the front page . . . and then along comes this, which is totally outrageous," Johnson said.

"Whoever thought that there would be a day when parents say 'Don't play with your dangerous toys, go play with your video games'?" he asked.

The console has been a tremendous boost for Nintendo, which lost to Sony Corp. and Microsoft Corp. in the last generation of game consoles. In the quarter ended Sept. 30, it more than doubled sales to $6.1 billion from a year ago, just before the Wii's launch. It has sold 5.5 million Wiis in the U.S. since its Nov. 17, 2006, debut.

The stock market now values Nintendo at $75 billion, compared to $48 billion for Sony, which has six times the revenue.

Nintendo has increased the pace of production but acknowledges that it won't be able to satisfy holiday-season demand.

"It's brand-new technology, so you can't build it on just any line," said Nintendo's Kaplan.

In an interview last week, Sony Chief Executive Howard Stringer said the Wii shortages were "a little fortuitous," and indicated the PlayStation 3 was poised to benefit. U.S. sales of the console doubled to 100,000 per week soon after an Oct. 18 price cut, he said.

The issue of demand outstripping supply has dogged Nintendo with the DS hand-held game as well, which launched in 2004.

"We've been struggling since launch to keep inventory — we finally have enough of that," Kaplan said.