Of the big three companies still making video game consoles, Nintendo are the veterans. Having seen Sega and Atari collapse over the years, it is far from impossible for an established console maker to struggle and fail.
Just as Sega’s consoles diminished in returns with each iteration between the Megadrive and Dreamcast, every Nintendo home console since the NES sold less and less… until the Wii came along.
Though the console ran out of steam at the end of its life, the Wii was a sensation early on. The console had sales comparable to the Sony Playstation, shifting over 101 million units. It looked like Nintendo had been resurrected, but the successor, the Wii U, did less than just fail to match the Wii. With sales lower than the Nintendo Gamecube, Wii U has sold 9.20 million units so far, while the GameCube sold 21.74 million in its lifetime.
The company has returned to relying on their own hard work, making games to support themselves.
Nintendo’s finances, on the other hand, are still feeling the effects of the Wii, as reportedly they have 812.8 billion Yen (£6.7 billion) in the bank, meaning that they can afford to lose 20 billion Yen (£163 million) every year until 2052. Nintendo are in a position with pressure to improve, but not financial pressure great enough to force them into abandoning the console race.
While Nintendo’s current handheld has not matched the runaway success of the Gameboy and DS before it, the 3DS has had success, selling 50.41 million units. The decision to begin supporting phones and tablets is most risky for this handheld market, since the devices are essentially competitors.
Some of the 3DS’ success could be due to parents unwilling to allow their children to own phones and Nintendo’s fairly old fashioned approach with basic online functions and emphasis on physical media places it as an alternative.
The 3DS has one major advantage over phones: the buttons. Despite some companies creating peripherals that force buttons around tablets and phones, nearly all gamers on their phones will be using the touch screens. Games including Grand Theft Auto and Tomb Raider have been ported onto phones, but with complex analogue controls placed onto a touch interface, it’s easy to see them as diversions rather than the full experience.
Gameplay wise and business wise, Nintendo will likely benefit most by releasing simple games that are more suited to phones than their own devices.
Puzzle games including Yoshi’s Cookie, Doctor Mario and Pokemon Trozei, which are all given minimal attention on Nintendo’s devices, might be right at home with Candy Crush fans. Nintendo has begun to experiment with this, releasing Pokemon Shuffle as a freemium game on the 3DS, which has been downloaded over 2.5 million times. Pokemon Shuffle could conceivably do even better business on phones and tablets and would not be confused with the mainline Pokemon RPGs.
However, Nintendo has a track record of confusing consumers. The Wii U and 3DS product names fail to adequately distinguish themselves from the Wii and DS respectively. Releasing games even slightly resembling the premium console product could hurt Nintendo, even ports of very old games, as casual consumers may not understand that what they are getting is not all Nintendo have to offer. I thoroughly expect to hear parents saying: “no Timmy, you don’t need the 4DS, you have your phone to play the Mario.”
Will Nintendo be using the apps to earn easy money through brand recognition, or will they be using them to heavily advertise what is possible on their handhelds and not on the phones and tablets?
Nintendo are using the free to play developer DeNA to develop their games. This could be worrying, as the only well known case of Nintendo allowing a company to release games with their licenses on other platforms is Panasonic, with the notoriously bad 3DO Zelda games.
Free to play Nintendo games aren’t a necessarily frightening prospect, in fact a free to play game with Nintendo polish and a reluctance to be too sleazy with their microtransactions could work very well.
A bad game that makes money with a Mario or Pokemon brand might be good for business in the short term, but it could also upset some hardcore fans: the fans who are currently supporting the Wii U.
Nintendo also announced the new NX platform in order to emphasise that they will continue to produce hardware. The Wii and DS demonstrate how difficult Nintendo are to predict and the Wii U and 3DS show that their decisions are not always the most logical. How Nintendo will ultimately use phones and tablets may surprise and be completely contrary to what is speculated.
Written March 22 2015, for the Badger Newspaper.