Nintendo had its worst quarter in a long time.  Sales of its aging Wii video console fell by over half to 2.23 million units for the last period. Profits also dropped by more than half to $447 million.

Ninetendo only has a few options to turn its fortunes around.

The company could cut the price of the Wii, but it is already the least expensive product in a market that includes the Sony (SNE) PS3 and Microsoft (MSFT) Xbox 360. The Japanese company is also reluctant to harm its margins.

Nintendo could work with game developers to create more attractive games for the platform, but developing games can take several quarters.

That leaves Nintendo to rely on its new Wii Resort Sports products, which is out in Japan but was  not the US or Europe in Q2. Resort Sports has the looks of a blockbuster. It allows the users to physically move with the action on the screen. The product is described as a “day at the beach” allowing players to doing most of the physical activities that they would do on a sunny day of vacation.

The Wii is getting old, so it has to rely on new features to keep its lead in the console. If Wii Resort Sports is not a huge hit, Nintendo will have let its two competitors back into the game.

Douglas A. McIntyre

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