July 26, 2011 at 3:28 PM ET
The Nintendo 3DS is a sharp little gadget that lets you play video games in eye-grabbing 3-D without having to put on those goofy 3-D glasses ... and yet, this sharp little gadget isn't selling as well as Nintendo had hoped.
Perhaps it's the device's $250 price tag. Perhaps it's the lack of a signature Mario Bros. games. Perhaps people just aren't that excited about 3-D. No matter what it is, Tokyo analysts are now saying they expect Nintendo's first quarter earnings to disappoint — in part thanks to lackluster 3DS sales.
But Nintendo is soldiering on, rolling out new features for the 3DS to help increase its appeal and boost sales as we push toward the all-important holiday buying season.
This week the company launched a new video service that now allows 3DS owners watch short videos in sharp 3-D. And earlier this month, Nintendo also added the Netflix video service to the device. (Alas, the 3DS's new Netflix app — which requires an unlimited streaming subscription — does not stream movies in 3-D.)
Video to the rescue?
Starting this week, the new Nintendo Video application can be downloaded to 3DS devices for free from the online eShop, which arrived on the gadget just last month.
The video app delivers a hand-picked variety of short-form videos to your machine each week. New videos will be added and older videos will be removed on a regular basis to keep things fresh, Nintendo says. The videos themselves are two to three minutes in length and will include a mix of short films, music videos, comedy performances and movie trailers.
During this week's launch, 3DS owners can find two animated short films — one of them from famed funny site CollegeHumor.com called "Dinosaur Office" — along with a trailer for the "Captain America" movie.
While the pickings are currently pretty slim, Nintendo says that in the coming weeks the app will offer exclusive 3-D videos from music artists Jason DeRulo and Foster the People, as well as trippy performance troupe the Blue Man Group. But they'll really kick things off Wednesday with an exclusive 3-D music video from the band OK Go.
Will these 3-D video offerings from Nintendo help boost 3DS sales? Well ... maybe.
The 3-D video playback looks nice and crisp on the device's top-screen. Meanwhile having Netflix access on the 3DS definitely helps broaden its appeal. Certainly, in an age when smartphones have trained gadget owners to expect their devices to do many things at once, Netflix and Nintendo Video are the kind of feature boosts that the 3DS needs.
But what would make Nintendo Video a real boost for the 3DS is if it offered longer 3-D video fare (TV shows and movies). The 3DS is one of the few portable devices with glasses-free 3-D capabilities and having the ability to take 3-D movies on the go would make the gadget very appealing indeed. Nintendo has implied, in the past, that this was a possibility. So here's hoping that pans out in the not-too-distant future.
For the time being, however, I think it's the games that will ultimately have the real power to drag the Nintendo 3DS out of the sales doldrums. Though an alarming number of 3DS games have been canceled recently, Nintendo will be pulling out the big guns in the coming months. The company plans to launch a brand new "Super Mario" game for the 3DS along with "Mario Kart 3DS" this holiday. They will follow that up with "Luigi's Mansion 2" for the 3DS next spring.
But before that happens, Haruka Mori, a technology analyst at Barclays Capital in Tokyo, reports that he expects Nintendo to post a $11.9 billion net loss in the April-June quarter and even miss its full-year financial targets.
For the fiscal year ending March 2012, Nintendo is forecasting sales to rise 8.4 percent to 1.1 trillion yen ($14 billion) and net profit to climb 42 percent to 110 billion yen ($1.4 billion). The company also expects to move 16 million 3DS machines this fiscal year.
"It is not only the 3DS that is struggling at present," Mori said in his recently released report. "Sales of the legacy DS and the Wii — which has been discounted in Europe and the US — appear to be below plan."
And laying off the 3DS for a moment ... it seems some folks are having a hard time getting their heads around Nintendo's forthcoming Wii U game console and that's causing some of Nintendo's problems as well, Mori believes.
Though In-Game editor Todd Kenreck and I immediately saw the appeal of the device (due to launch next year) when we were given a sneak preview of it at the Electronic Entertainment Expo last month, Mori said the Wii U has failed to impress investors who have had difficulty judging the potential of the unusual machine with the beefy touch-screen controller.
But nobody — not even the most talented financial analysts — can see the future. And so I'd remind people who are ready to count Nintendo down and out, that much of the world mocked the Wii when it was first revealed. And that game machine went on to crush the competition and changed the face of the video gaming industry at large.
(The Associated Press contributed to this report.)
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Winda Benedetti writes about games for msnbc.com. You can follow her tweets about games and other things right here on Twitter or join her in the stream right here on Google+.You can check out the In-Game Facebook page right here.