Nintendo kicked off the next generation of video game consoles with a sellout: Its new Wii U console has sold all 400,000 units that were delivered to stores, and the firm says it could have sold more if they were available. Nintendo also sold 300,000 previous-generation Wii consoles and more than 500,000 portable gaming machines in the past week, for a total of 1.2 million hardware devices in one week.

“Wii U is essentially sold out of retail, and we are doing our best to continually replenish stock,” Nintendo of America President Reggie Fils-Aime said. “Retailers are also doing their best to get the product to store shelves. But as soon as product hits retail, they're selling out immediately.”

The Nintendo Wii U launched in North America on November 18. This console adds HD graphics and a new touchscreen-based Wii GamePad that enables a unique two-screen gaming experience. Rivals Microsoft and Sony are expected to surpass these capabilities with new consoles that could arrive as soon as next year, but this gap gives Nintendo a healthy head start. And the previous Wii has outsold the more powerful Xbox 360 and PlayStation 3 by wide margins.

The key to Nintendo’s success, of course, is its focus on fun and unique gaming experiences rather than hardware specifications. Where both Microsoft and Sony pushed the boundaries of technology with their Xbox 360 and PlayStation 3 consoles, Nintendo’s Wii was technologically inferior but offered innovative and fun motion-control gaming. Getting clobbered in the marketplace, Microsoft and Sony raced to catch up, releasing the Move and Kinect accessories, respectively, two years ago. But neither is as seamless and simple as the system that Nintendo released years earlier. (More recent news about Kinect: "Kinect Gets a $40 Price Cut.")

The question is whether Nintendo—which only makes games and game machines—can continue to outpace its more diverse competition. The Wii U’s move to touch-based interfaces is more of a reaction than a revolution—Apple pretty much pioneered this market years ago with the iPhone and iPod touch—and is expected to be duplicated by others as well. The firm is also reacting to the broader entertainment strategies of Microsoft and Sony, and is offering services like Netflix on the new console, too.

For more recent news about the video game market, see "Video Game Market Continues Its Downward Spiral."