I applaud Nintendo for their decision to drop the price on the 3DS. The news came last week that the system will tumble from $250 in the U.S. to $170. That reduction by nearly a third of launch cost will be happening around the world on August 12th.

For all of the system’s flaws and misgivings, Nintendo needs to be recognized for the way they’re handling the knocks. They’ve learned that 3D doesn’t mean everything to their consumers, and I’ll admit that I love the system for everything it does outside of the 3D portion. The company recognized that sales were well off of what they projected, and they reacted … epically.

One has to assume that Nintendo first figured a price drop was essential when Sony released the price point for the PS Vita. I was in the room for that announcement, and the excitement surrounding the MSRP of $250 for the PSP’s successor was palpable. Sony crushed it with that news; Nintendo had to react, and the decision to reduce the consumer cost of the 3DS had to come.

It certainly didn’t help that Nintendo tried, in vain, to spread its first party productions across the initial calendar year in order to boost the sales for third party efforts. If you’re wondering why Nintendo elected to push all of its content further down 2011 and into 2012, there’s your answer. The company wanted to make the market more friendly for third party published software. That’s always been a source of problems for Nintendo, the third party products released for their systems regularly underperform.

Well, that backfired. So, in the face of a shoddy release calendar, a 3D display that worked only to excite consumers slightly instead of drive sales, the announcement of an incredible price point for the next big source of competition in the PS Vita and the negative buzz surrounding the system’s software lineup, Nintendo had to make a move.

The price cut was the best thing the company could do. While onlookers may see this move as Nintendo admitting that their system can’t live up to its initial hype, it would be foolish to consider the Nintendo 3DS dead in the water at this point. The fact of the matter is that Nintendo software, I’m talking Mario, Mario Kart, Icarus, etc., will always drive system sales. Couple those releases due this holiday with a price point that’s actually attractive and you’ve got a system worth buying and selling.

Will the 3DS be a handheld that delivers the sales longevity of the DS? No. I don’t believe it will. However, the company has given the machine a fighting chance at actually being a success. That’s a start.