Nintendo just announced their Q3 sales numbers, and reported sales of 1.95 million consoles between October and December. So not only did they beat the 1 million number you were predicting for FY2014, but they almost doubled it in just one quarter.

I’m looking forward to the blog post saying you were wrong.

“For 25% more a user can purchase a vastly superior system for which developers will write cool games.” The PS4 costs 33% more than the Wii U, not 25% more. $399 is 33% more than $299.

I’m going to bookmark this page and come back after the FY14 results have been reported. Care to make a gentleman’s wager that the Wii U will not sell 1 million units in FY14? I think that it will beat that number.

Also, Sony is almost certainly taking a loss on every console sold, which they always do with new consoles in order to remain price-competitive with Microsoft. In fact, their PS3 console (which launched in 2006 at $599) on started making a profit in 2013. Meanwhile, Nintendo always sells their consoles at a profit, so even if sales are lean (as they were in the Nintendo 64 and Gamecube years), they continue to make money on each console sold.

So again, let’s compare the two companies, and see if we can spot an inconsistency in your analysis:

Sony: Has the PS4 which is selling well, the Vita which has sold 4 million consoles since 2011, and the PS3 which was the second-best home console of the previous generation. They have also lost money for four of the last five years.

Analysis: Sony remains the only Japanese company that has a hope of a future in consumer electronics.

Nintendo: Has the 3DS which was the top-selling console of 2012 and 2013, the Wii U which has sold 4.3 million consoles since 2012, and the Wii which was the best-selling home console of the previous generation. They have also made money for four of the last five years.

Analysis: Nintendo’s money should be returned to the shareholders.

Having an ecosystem is a nice theory, and that’s certainly the tack that Sony and Microsoft are trying to take. Sony is a media company, so naturally they are trying to sell Blu-rays and digital distribution and phones and tablets and computers and TVs. And Microsoft certainly wants to pattern themselves after Apple, where they sell computers and tablets and a media store. Both companies are pushing so hard for the ecosystem model that they are willing to lose money on their consoles at launch, hoping that they will make it up over time. Meanwhile, Sony is bleeding cash, and Microsoft is trying desperately to succeed in the tablet and phone business.

And while all this is going along, Nintendo is sitting quietly by, with their $10.5 billion dollars in the bank, making game systems and actual games which continue to be critically and financially successful. Your mistake is thinking that Nintendo is losing the “Digital Life” game, when in fact they are not even playing.

And yes, Nintendo has the most valuable gaming brands in the business. And the quickest way to devalue those brands is to put them out on a device with substandard controls and sell them for 99 cents each.

Secondly, you are greatly exaggerating the market for, and profitability of, mobile games. Current estimates are that there are about 200 million App Store users. Meanwhile, there are 35 million 3DS systems sold. The problem is that the iPhone market is flooded with games, and almost all of them sell for low prices. In fact, 88% of the games downloaded on iOS are free. That means that as you price your games higher, sales drop off drastically.

Let’s take some examples of blockbuster iOS games, and see how much they made:

Infinity Blade made $10 million in 7 months, and in January of 2012, the Infinity Blade franchise had reached $30 million in revenue.

Cut the Rope was an incredibly high-profile launch, and they managed to sell 3 million copies in 6 weeks, which means $3 million (minus the 30% cut for Apple), or $2.1 million in revenue.

Order and Chaos made $1 million in 20 days for a $6.99 game, which translates to about 7000 downloads a day (excluding in-app purchases).

But what about smaller games? Tiny Wings was a huge success, with an estimated 6.5 million downloads over its lifetime. At $1 each, that’s $4.5 million in revenue (after Apple’s cut).

So how does a 3DS blockbuster compare to this? The Pokémon X and Y games sold 4 million copies in the first two days they were released. Let me say that again: 4 million, in two days. Even assuming manufacturing costs of $5 per cartridge (I’m estimating high here to make a point), that means that Nintendo made $140 million in revenue in two days.

In other words, in two days, Nintendo almost 5 times the revenue that Infinity Blade 1 and 2 made over their lifetime. Nintendo made over 60 times more in two days than Cut the Rope made in six weeks. Nintendo made 140 times more in 2 days than what Order and Chaos made in 20 days. And Nintendo made more on Pokémon in 2 days than Tiny Wings made over its entire lifetime.

And those are the iPhone blockbusters.

“The main point here is that with PS4 for only $100 more, very few people in their right minds will buy the Wii U.” Spoken like a true non-gamer! If you just look at the horsepower of the system, then sure, the PS4 looks like a better deal than the Wii U. However, you’re forgetting that people buy game systems to play games.

If you wanted to pick up a PS4 and two exclusive games, it would cost you $620, and you would end up with Killzone (73% on GameRankings) and Knack (58% on GameRankings). $620 buys you a great system and two mediocre games.

If you spent that same $620 on a Wii U, you could get the console, New Super Mario Bros. U (84%), New Super Luigi U (76%), Super Mario 3D World (93%), Rayman Legends (93%), The Legend of Zelda: Wind Waker HD (91%), Pikmin 3 (87%), and Monster Hunter 3 Ultimate (83%). Oh, and you’d still have $21 left over.

In other words, you can spend $620 and get a PS4 with two games, or spend $599 and get a Wii U with seven games, each of which is rated higher than the best exclusive PS4 game.

“Price cuts have never been able to rescue a dying platform.” Except for the 3DS, which was failing badly after launch (doing about as well as the Wii U, actually), took an $80 price cut, and ended up being the best-selling console of 2012 and 2013.