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Following the 3DS price cut announcement yesterday, Nintendo President Satoru Iwata said he is taking a 50 percent pay cut.
Last year, Iwata reportedly made a base salary of $770,000 with performance-based bonuses that could see him earn over $2 million. Other Nintendo executives, including designer Shigeru Miyamoto, are also taking pay cuts of 20 and 30 percent.
"It is quite unusual for us to change the price in less than half a year from a product's launch. I am aware that realizing both the short-term and the mid-to-long term profits is one of my responsibilities as part of the management," Iwata told investors.
"Needless to say, the deduction of the fixed compensation is what we volunteered to do in order to show our sincere attitude and to fulfill our responsibility. We really must recover our financial performance and take Nintendo back into the position in the marketplace where it is well appreciated."
The 3DS' price will be dropped from $249.99 to $169.99. Iwata said one reason for the price drop was it has taken longer for the handheld to appeal to a mass audience.
"For us to maximize the effect of the anticipated titles of this year end, it is necessary to greatly expand the installed base (before the launches of the anticipated titles) so that the appeal of the new software will be able to spread to consumers in a short period of time," he said. "Without creating such a circumstance, we would not be able to realize explosive sales in the year-end sales season. This is one reason for the markdown.
"Another reason is, we thought that eliminating the concerns of future hardware expansion early on would make a great difference to how retailers and software publishers will allocate their energies.
"In short, we have concluded that, for Nintendo 3DS to expand enough to become the successor of Nintendo DS, we have to take a drastic approach."
source
Nintendo's dismal earnings report yesterday resulted in its stock price taking a sharp drop, falling up to 21 percent according to a recent report by Bloomberg. The company reacted by slashing the price of its 3DS portable to create demand and drastically lowered its forecasted earnings. If those forecasts are accurate, the company will have a net income lower than any it has seen since 1986. If Nintendo's news was grim, it might actually be worse for one man - Hiroshi Yamauchi.
Yamauchi is the 83-year old former president of Nintendo. Retiring in 2002 after running the company his great-grandfather founded, Yamauchi is estimated to still own about 10 percent of Nintendo's stock. Yesterday's drop could have cost the former executive, who ran Nintendo for 53 years, as much as $312 million according to Bloomberg.
At one time, Yamauchi was estimated to be Japan's richest man. Latest figures had placed his worth at $4.6 billion, good enough to be sixth on Forbes magazine's rankings. Clearly that number has changed, but there's no doubt Nintendo's third president will be just fine no matter what happens to the company in the future.
source
It's good they did this, the USA leaders could take a page from them.
Last year, Iwata reportedly made a base salary of $770,000 with performance-based bonuses that could see him earn over $2 million. Other Nintendo executives, including designer Shigeru Miyamoto, are also taking pay cuts of 20 and 30 percent.
"It is quite unusual for us to change the price in less than half a year from a product's launch. I am aware that realizing both the short-term and the mid-to-long term profits is one of my responsibilities as part of the management," Iwata told investors.
"Needless to say, the deduction of the fixed compensation is what we volunteered to do in order to show our sincere attitude and to fulfill our responsibility. We really must recover our financial performance and take Nintendo back into the position in the marketplace where it is well appreciated."
The 3DS' price will be dropped from $249.99 to $169.99. Iwata said one reason for the price drop was it has taken longer for the handheld to appeal to a mass audience.
"For us to maximize the effect of the anticipated titles of this year end, it is necessary to greatly expand the installed base (before the launches of the anticipated titles) so that the appeal of the new software will be able to spread to consumers in a short period of time," he said. "Without creating such a circumstance, we would not be able to realize explosive sales in the year-end sales season. This is one reason for the markdown.
"Another reason is, we thought that eliminating the concerns of future hardware expansion early on would make a great difference to how retailers and software publishers will allocate their energies.
"In short, we have concluded that, for Nintendo 3DS to expand enough to become the successor of Nintendo DS, we have to take a drastic approach."
source
Nintendo's dismal earnings report yesterday resulted in its stock price taking a sharp drop, falling up to 21 percent according to a recent report by Bloomberg. The company reacted by slashing the price of its 3DS portable to create demand and drastically lowered its forecasted earnings. If those forecasts are accurate, the company will have a net income lower than any it has seen since 1986. If Nintendo's news was grim, it might actually be worse for one man - Hiroshi Yamauchi.
Yamauchi is the 83-year old former president of Nintendo. Retiring in 2002 after running the company his great-grandfather founded, Yamauchi is estimated to still own about 10 percent of Nintendo's stock. Yesterday's drop could have cost the former executive, who ran Nintendo for 53 years, as much as $312 million according to Bloomberg.
At one time, Yamauchi was estimated to be Japan's richest man. Latest figures had placed his worth at $4.6 billion, good enough to be sixth on Forbes magazine's rankings. Clearly that number has changed, but there's no doubt Nintendo's third president will be just fine no matter what happens to the company in the future.
source
It's good they did this, the USA leaders could take a page from them.
