Following news that the 3DS’ price will be dropped from $249.99 to $169.99, Nintendo President Satoru Iwata will be taking a 50 percent cut in his pay. Other Nintendo execs, including Designer Shigeru Miyamoto will be taking pay-cuts ranging from 20 to 30 percent.
According to an article published by gameindustry.biz, Iwata reportedly had a base salary of around ¥68 million (that comes to $770, 000 USD) and up to ¥187 million (approximately $2 million USD) with performance-based bonuses. With a 50 percent pay-cut, Iwata would make no more than roughly ¥94 million (approximately $1 million USD). While $1 million is not exactly chump change, it’s nothing like we’d see oil execs getting paid after a similar pay-cut.
“I feel greatly accountable for having to make the markdown,” Iwata said regarding the 3DS price cut.
During this announcement Iwata commented on the 3DS price cut, and management’s responsibility for its slump in the market place. “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 said.
Iwata went on to comment that the pay-cuts taken by the Nintendo execs is a show of determination to resolve the problem. “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.”
In regards to the 3DS’ hardships in the marketplace, Iwata said he believes one of the reasons behind the 3DS’ $80 price cut is that the handheld is taking a longer time to appeal to a wider audience.
The Nintendo president also said the price cut was a means to expand the 3DS user-base by the time the holiday season comes around and primary titles (like Kid Icarus: Uprising, Star Fox 64 3D and Luigi’s Mansion 2) take to the shelves. ”Without creating such a circumstance, we would not be able to realize explosive sales in the year-end sales season,” Iwata told investors.
The price cut was also explained by Iwata as a way to alleviate concerns on how well the 3DS would sell so that developers, designers and retailers wouldn’t worry how to “allocate their energies.” This was sure to be a concern of Nintendo’s after several prospective titles were either delayed or cancelled.
Whether or not this pay-cut taken by Nintendo’s execs is actually a gesture of goodwill and a promise to overcome their current hardships or just a matter of good publicity remains to be seen. What is certain, however, is that Nintendo’s straying into unusual territory and could use a pick-me-up.