NINTENDO NEWS – An analyst says Nintendo’s new console will be a huge success, even with a surprising price tag.

WCCFTech regularly interviews Rhys Elliott of Midia Research. He believes that the Nintendo Switch 2 will be a huge success despite the $450 price tag. One example is Mario Kart World, which will cost €90 in Europe ($80 in the US). Elliott said this is to push the big N toward digital sales, as the ratio is currently 50-50, while Sony, for example, has a digital sales ratio of around 70%.

“The Nintendo Switch 2 is slightly more expensive than many of us analysts thought, but $450 is still within the $400-500 price range I expected. While I still think $400 is the sweet spot and we’ll see a cheaper SKU eventually, $450 is still affordable and in line with other consoles and the Steam Deck. Unlike other manufacturers, Nintendo relies almost exclusively on its console and console software business, so loss-leading pricing simply wasn’t in the cards. At $450, the Switch 2 is still cheap enough for mass market adoption, and given the stacked and diverse software lineup, I believe it will sell well to core gamers, casual gamers, families, and more.

While the orange man’s tariffs and Nintendo’s desire to increase ARPPU are part of the reason Nintendo is charging $80 for Mario Kart World, I think there’s more at play. Nintendo also wants to encourage consumers to buy games digitally. The lower prices for digital games compared to boxed games (true for Donkey Kong and Mario Kart) point to this. Another factor is last week’s announcement of the Digital Game Card, which allows players to “loan” games to their Switch Online Family Plan members. A bit of context here: PlayStation and Xbox have already pushed their platforms to become digital-first, driven by strategies like multi-game subscriptions, digital-only consoles, the rise of free-to-play, and platform owners pushing consumers to digital versions through perks (like extra cosmetics and the ability to pre-load a game so it’s ready to play at launch). So PlayStation and especially Xbox are very digital-first. But Nintendo is different, more 50-50.

For consumers, a unique value proposition of physical games is the used and rental market. But Nintendo’s reliance on physical affects its bottom line, hence the nudging. Nintendo makes no money from physical rental and resale. After all, a copy of Mario Kart 8 Deluxe could be sold 100 times on the resale market or rented 100 times, but Nintendo would only make money on the first sale. A digital-only market means more revenue and price control for Nintendo. Long story short, Nintendo’s use of framing (sticker shock for physical) actually pushes people to digital, which benefits Nintendo,” Elliott said.

So, he said, Nintendo’s strategy makes sense.

Source: WCCFTech