July 15 (Bloomberg) -- LeapFrog Enterprises Inc. has made hit toys by creating kiddie versions of adult gadgets like Apple Inc.’s iPad. Now it’s trying to do the same thing with video-game consoles.
Following the success of its LeapPad, a kid-focused tablet that’s been one of the best-selling toys since its 2011 debut, the company is riffing on Nintendo Co.’s Wii with a video-gaming system equipped with motion sensors called LeapTV. The console is aimed at children ages 3 to 8 and will hit stores this holiday-shopping season at $150, according to a statement from the Emeryville, California-based company.
LeapTV has been in development for about two years, LeapFrog Chief Executive Officer John Barbour said in an interview today. The genesis came from asking young kids in focus groups what they would want to play with, but aren’t allowed to, said Barbour, who’s been at the company for three years. LeapFrog quickly realized there was a hole in the market for a console and games aimed at this demographic, he said.
“We’re fortunate because nobody is doing this,” Barbour said. LeapTV has the potential to be as successful as the LeapPad, he said.
LeapFrog could use another hit. Revenue fell the past two quarters, including a 31 percent drop in the most-recent period. New products this year, including LeapTV, are expected to help revive results, the company has said.
The stock could use a lift too, after declining more than 30 percent in the past year.
One of the knocks against the company has been that it relied too much on the boom in tablets, and as that market cooled off, so would LeapFrog’s prospects for growth, Barbour said. LeapTV will show investors that the company is more than just a kids tablet-maker and can continue to generate sales gains by expanding into new markets, he said.
With LeapTV, “people will get better clarity on our vision of how we can grow this business,” Barbour said. “We can do it in other categories.”
LeapTV uses a motion sensor and video camera to encourage users to move. There’s also a simplified controller with only two buttons. The system can connect to a wireless Internet signal for downloading games and other content. There will also be nine cartridge games, including ones for licensed properties such as Walt Disney Co.’s Sofia the First, for sale at $30 apiece.
The gaming system will be available in major retailers, including Wal-Mart Stores Inc., Target Corp., Amazon.com Inc. and Toys “R” Us Inc., Barbour said.
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