Is this a sign of the times or what? Nintendo briefly passed Sony today in terms of market capitalization and was at one point one of the top 10 most valuable companies in Japan. It ended the day at number 11 as its shares lost earlier gains and actually closed lower. In closing at number 11, Nintendo passed Matsushita Electric who happens to be the parent company to Panasonic. Both Matsushita and Sony have sales that are more than eight times larger than Nintendo.. yet here we are as Nintendo has become a valuable name brand in the Japanese market.

Clearly, Nintendo’s gained tremendous ground over the last 8 months with the introduction of the Nintendo Wii. The Wii has easily outpaced Sony’s money losing Playstation 3 console. But it’s not just about the home console market. Nintendo is also beating Sony out in the portable gaming market with the Nintendo DS. Demand for the DS has outpaced demand for the Sony PSP (Playstation Portable).

How long will all of this last? Who knows at this point. It could be said that the Wii is just a fad (Sony would certainly like to think so). As more content becomes available for Sony, we’ll certainly see demand pick up over time. One thing also to consider – price barriers. I’m sorry but most people are not willing to shell out nearly $600 dollars for a game console. $250 dollars on the other hand is a bit more palatable. So it boils down to two major factors for the Wii – it’s inexpensive and it’s FUN. The same can’t be said of the PS3. If the PS3 lowers its price to a more reasonable amount.. and when the content finally does begin arriving, I think we’ll start seeing an upward slope trend. However.. one other thing to keep in mind for Sony and that’s the Xbox 360 from Microsoft. Sony not only has to create content that’s attractive to the gaming audience at hand, they have to create a unique experience that’s discernable from Microsoft. These are all things to consider.

For now, let’s all commend Nintendo for a job well done!

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Technorati Tags: Nintendo Wii, Nintendo, Sony, Playstation 3, Market Capitalization