Most of these comments have already been responded to by fellow members, but they were directed to me so I'd like to get my thoughts in. I have a sense that Morari enjoys trying to belittle us, so I will take a stand.
Just because something is popular does not make it right. Most people (10 million being a drop in the bucket, after all) are completely uninformed, unthinking, consumer drones. One needs to only look at some of the comments throughout this thread to see that.
I can't tell if you're anti-industry or anti-consumer. Your comments suggest both. Either way your attitude seems to be pro-piracy and for this you should be ashamed.
Nintendo is right to charge $50. 10 million people agree. If they didn't, they would not have handed over their money. Don't call them stupid - one would consider you stupid for thinking you know how everybody should spend their money. You aren't better than these 'drones', no matter how lowly you consider them.
Nintendo isn't a monopoly, so don't question the desires of the market.
That's entirely subjective. The common gamers (common Wii owner especially) has no idea that such piracy even exists, let alone how to do it. Besides, there's a huge element of "time vs. cost" to take into account when copying games. A lot of people would be willing to simply pay for the product simply to make sure it "just works".
Now come on, it's obvious that piracy levels are a function of ease. Are you suggesting that piracy would be as high even if all copies disappeared from the internet? I think record stores would have to disagree with you. Even after they reduced their prices, few were buying (and this was before iTunes).
No, we're talking about Nintendo's target audiences; children. Most twelve to fifteen year olds do not have jobs and cannot purchase videogames themselves. Mommy and daddy are only going to purchase so many games for them. Looking back at my previous point, what these kids do have an abundance of is time. The time it takes to download and implement a games is worth it to them, because they cannot meet the $50 toll.
As an aside, I'd like to posit that NSMBWii wasn't targeted towards 12-15 year olds. They haven't played 2D mario before and wouldn't have much interest (overall). It was targeted to older gamers who remember the 2D games (and were asking for more).
Perhaps we should rethink what a marginal profit would be. NSMBW didn't take very much at all to produce. It's ridiculously simple and has very little in the way of visual assets.
If it was so simple, why didn't another developer do it beforehand? Why did it take Nintendo 20 years to realize the revenue-generating potential of such a cheap game? Wasn't the industry calling Nintendo crazy for planning to charge $50, which the market would not be willing to pay? Yes, once the game was committed to, relatively little investment was needed. This is Nintendo's reward for coming up with the idea. It's the game of business. Without it, companies wouldn't be making your video games. If they think they can make more profit working on something else, that's where they'll move.
If developers can't make a profit off of a $20 game then they're doing something wrong. Hollywood spends a ton more making lame blockbuster movies, yet the theater tickets only cost $5 and the DVD release sits around $20. Or how about a new novel? You can go purchase a brand new hardcover novel for $35. It's going to give you a longer-lasting amount of entertainment, and has actual, material costs involved in its manufacturing.
I didn't even mention shipping costs (which are significant), but don't deny that marginal costs matter. Yes, it may be less than other products, but I assure you all video game producers are aware of them.
Length of entertainment is not so much important as quality of entertainment. Yes I might be entertained by a book for hours upon hours, but I'm willing to spend much more at an amusement park because the quality of entertainment is greater. This relates back to the cost of development. I know NSMBWii cost little to develop, but this concerns me not. Output (quality of entertainment) is what I pay for, and in this case 10 million people judged that this condition was satisfied. Your argument, on the other hand, suggests that people are more concerned with the number of pages in a book (material value) than what's written on them.
Those people will pirate the game regardless. The game could be $1 and they would still take it for free. Those people are not lost sales, and should not be treated as such. Developers should stop wasting time and money on developing DRM schemes to hinder non-customers. They should instead be focused on making the experience as fun as possible for their actual customers. It's a greedy, ass-backwards way of looking one's install base. How much more profitable do you think NSMBW could have been had Nintendo not created and implemented new copyright protection for it? How much money and time do you think they could have saved had they not been hunting down and ruining the lives of people that were not doing anything at all to harm their product? This is copyright infringement we're talking about, not theft. No product was stolen and no units were lost. Potential loss does not equate to $1.5 million. Of course, you probably feel vindicated every time the RIAA sues the life savings out of someone's grandmother for downloading a single MP3.
Did you read the article? They sued the uploader - the source of piracy. If there's drugs in your neighborhood, you go after the dealers, not the users. Same principle applies.
For someone who claims to be familiar with the law, it's silly for you to deny the illegality of software piracy. Maybe there isn't any physical theft, but it's still criminal. If it wasn't criminal, why wouldn't the uploader challenge in court?