Lazard: Wii Production Reaching 1.5 Million Per Month

Reporting from the Nintendo Media Summit, Lazard's Colin Sebastian has said he believes Nintendo may be nearing its production target of 1.5 million Wiis a month, with demand still exceeding supply, and said the company is making "aggressive overtures" to attract third parties. Sebastian said the production numbers come from both comments made by Nintendo, as well as retailers like GameStop. "Based on our retail channel checks," said Sebastian, "demand still appears to exceed supply, and we believe that shortages could persist through the remainder of the year, including the key holiday period." As an aside, Sebastian said new reports from Asia "suggest that Sony has reduced production of PS3s, at least temporarily, which may suggest that a price cut is less likely this year. We continue to believe timing of Sony’s first PS3 price cut is likely to accompany a stronger software release lineup as well as further cuts in production and component costs." Sebastian said the Media Summit showed an "upbeat" Nintendo proud of the early success of its Wii and "rapid adoption" of the DS. The company reportedly also announced market study results "confirming that both Wii and DS platforms are generating a broader consumer group to the video game market, most notably an increasing portion of older and female gamers." "We believe that an expanding audience for Nintendo platforms could ultimately benefit third-party software in addition to first party sales," said Sebastian. To that end, he pointed to a number of exclusive Wii and DS titles from third parties confirming "casual focus," including EA's Boogie, THQ's Drawn to Life and Ubisoft's Jam Sessions. "Based on our conversations at the event, we also believe Nintendo is making more aggressive overtures to attract strong third-party support on its platforms," said Sebastian.