Wii $199 an aggressive tactic vs. PS3, Xbox 360

Nintendo Co. hasn’t publicly commented on a $50 price cut for the best-selling Wii console – and it may not have to. A leaked circular that disclaims a price cut for Wii to $199 has revealed what could be an aggressive tactic by Nintendo to retain leadership status in the console wars.

A sub-$200 price tag for Wii this holiday season is surprising for Nintendo. Despite analysts who claim that the console maker has no choice but to price cut following discounts by Sony Corp. and Microsoft Corp., Wii still has an edge that competitors don't – top motion-sensitive titles.

Microsoft and Sony's plans to enter the motion-sensor control market will start in 2010, leaving one last holiday season that Nintendo controls the market with its Wii Remote.

In addition, Nintendo's holiday game portfolio is substantially solid with titles like Wii Fit Plus, New Super Mario Bros., Super Mario Galaxy 2.

But, as video game sales continue to decrease in month-to-month tallies and the recession cuts in on family budgets, Nintendo isn't leaving anything to chance.

After three years on the market, Wii, with its low-cost components and standard definition graphics, has been quietly cost-reduced during its three-year $249 retail price. The company will likely still hold a profit for Wii at $199. If not, losses on each hardware sold will be undoubtedly negligible.

Though Wii is currently the worldwide console king, it isn't invulnerable. Sales for Sony's Blu-ray backed Playstation 3 have increased substantially following release of the Slim hardware, and the Xbox 360's low cost of entry to high-definition gaming and strong online service offerings are all attractive features that could lure potential Wii customers to rivals.

But a Wii at $199 will be a stronger impulse buy for the casual customer interested in family fun, a core gamer waiting for a sub-$200 price tag, or a gift giver that finds the $199 a value compared to most electronic items.

Nintendo is no stranger to console wars. After losing significant market share with the Nintendo 64 and GameCube, the unlikely Wii has taken the veteran company back to the top. This time though, it will be tougher to knock the console king off its throne.

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