

The Death Of Nintendo Has Been Greatly Under-Exaggerated - coloneltcb
http://techcrunch.com/2013/09/04/nintendont/

======
lolcraft
If I were an investor, and Nintendo's CEO came by and told me they wanted to
make games for smartphones or, god forbid, sell to _Apple_ , I'd sell so fast,
and with so much energy, CERN physicists would confirm the Higgs boson from my
clicking.

I think I already posted here about this, some eons ago. To recap: this
strategy is _bad_. It's let's take Nintendo from a powerful stance as both
platform maker _and_ virtuoso first party developer, to Oversized Third Party
Developer in a market notorious for:

(a) Low quality and extremely low fidelity demand, which prizes being cheap
and having a gimmick _over everything_.

(b) Notoriously capricious primma donnas such as Apple and Samsung as platform
makers, which take _insane_ cuts from developers.

(c) Being an extremely fragmented market, with thousands of devices with very
different characteristics and software _which Nintendo would have to support_.

Selling Nintendo to Apple is the business equivalent of folding a royal flush.
Yeah, so the iPad sold 100 million units. The DS sold _154 million_. _For a
single purpose device_. The 3DS might be 20% behind its predecessor's curve --
a ridiculously successful curve, if I might say -- but that's still a cold 124
million units. The Wii was a fad, true... and it redefined the meaning of fad
itself, selling _100 million units_ ; a _one model_ , _single-purpose device_.
When factored into this that Nintendo _profits from third party software_ \--
unlike Rovio, which has to pay its dutiful tides to petulant lovers by
excellance Apple and Samsung -- one starts clearly seeing how Nintendo is
pulling ass like Brad Pitt at a wet t-shirt contest. Absolutely insane. Not
even Steve Jobs could dream of selling a gadget so well as the 3DS does.

Not to mention that, again, in this business if you're a third party
developer, either your name is Activision, or you're into masochism. Lose
power, lose the platform, and you lose everything that makes you strong.

Edit: and I don't even like the Wii U.

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kristopolous
I'm not a Japanese citizen or know the language but I'm under the impression
that Nintendo is more like a Hasbro or Milton-Bradley; having been around
since about 1905 or so.

These companies don't seem to go away. They have brands that continue to sell
to the next generation of children.

Every now and then they become immensely popular and have some runaway freight
train successes. But even in the bad times, they seem to stick with it.

There are some game companies that seem to do the startup gamble. The company
that produced Teddy Ruxpin (Worlds of Wonder) and Atari seem to have been
structured this way; put all the chips on black and see what happens.

But I'm under the assumption that as an American what I see are the
electronics of Nintendo and that within the confines of Japan they have other
product lines such as boardgames and toys for children (things like this:
[http://d3gqasl9vmjfd8.cloudfront.net/aba95bdd-6979-4b92-b7fe...](http://d3gqasl9vmjfd8.cloudfront.net/aba95bdd-6979-4b92-b7fe-6e0589991d11.jpg))
- as that is their history.

Am I wrong, or is this fundamentally what Nintendo is?

~~~
GuiA
Nintendo used to produce card games etc., but today they only produce video
game consoles and software.

That being said, I think the rest of your comment still holds.

~~~
chromaton
They publish the Pokemon card game, yet another huge franchise.

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rgbrenner
For an article so sure of itself, it was incredibly light on actual facts,
figures, and numbers. I got: the 3ds has sold 20% less than its predecessor at
the same point in its lifetime.

Also got: Wii u is a dud (I think that's some kind of technical term); they
have like, a blackberry amount of cash (whatever that means); and the author
is "definitely" right.

Anyone have some actual details about why I should be concerned about
Nintendo?

~~~
kevhsu
Completely agree

20% less than the Nintendo DS is a good sales figure considering the DS is #2
in terms of video game console sales, only selling 3 millions units less than
the all time leader, the PS3.
([http://www.vgchartz.com/analysis/platform_totals/](http://www.vgchartz.com/analysis/platform_totals/))

~~~
pragmatic
The leader is the PS2.

~~~
kevhsu
oops typo :)

------
6thSigma
Nintendo's market cap is ~$15B. Their cash on hand is ~$11B. In my opinion,
their IP is worth sooooo much more than the difference.

Rovio, in comparison, is estimated between the $2B-$9B range. If Angry Birds
is worth that, what is Mario/Zelda/Metroid/etc. combined worth?

I do feel like they would be best served ceasing set top boxes and focusing on
handhelds and making games for the PS4, XB1, and PC. Perhaps port a few of
their games to iOS/Android.

To do this they would most likely have to get acquired though. I see Disney as
a much more likely suitor for that than Apple.

~~~
recuter
> "Rovio, in comparison, is estimated between the $2B-$9B range. If Angry
> Birds is worth that, what is Mario/Zelda/Metroid/etc. combined worth?"

I don't know, what is nostalgia worth? A lot more kids know and crave Rovio IP
these days. Sure, Mario/Zelda is recognizable and part of the zeitgeist but
then so is Pacman.

~~~
saltyknuckles
It can't be nostalgia if these kids have never experienced what a real video
game should be.

~~~
fivethree
This is the problem with your thought process. Video games have changed. What
you think they should be isn't what they are now. You don't continue, and grow
as a company by targeting a shrinking demographic.

~~~
saltyknuckles
Something is wrong with your thought process when you think the most dominant
type of games are touch screen games. Video games haven't changed, there are
just different types of games now. Some of which are limited by their lack of
controls. Last time I checked gamers still exist, many of which don't play
touch games.

Don't forget who had utilized a touch screen for games properly.

~~~
fivethree
Yes, but as this article and many others have discussed; that number is
shrinking. Gamers still exists, but you don't make billions of gamers. You
make billions of consumers as a whole, and convincing people to buy yet
another piece of hardware to do something is a hard sell. "I could just use
this thing I carry with me everywhere," or, "I could buy a 2nd dedicated
device that only does games (well) _"

_ I'm aware the DS/3DS/etc do more than games, but anyone that uses the DS
browser and thinks it's good is a liar.

------
saltyknuckles
A lot of this is not really structured it's just a bunch of thoughts I want to
share with everyone.

This guy may say he loves Nintendo but I really don't think he's a gamer. He
seems to be looking at it from the smartphone market point of view. The author
compares Nintendo to Nokia and Blackberry; phone companies that barely even
touch console or mobile gaming. Nokia and Blackberry lost a lot of market
share but to say that Nintendo has fallen off as hard as they have is false.
Relative to their markets of course.

Why can't console gaming still be a market and co-exist with touch screen
games? Is there really only room for one? Just because the PC exists doesn't
mean consoles will go to shit or that no one buys PC games.

Nintendo does pretty well in it's home country Japan, and I bet in other parts
of the world also.

The author also neglects to talk about the differences in gaming markets. He
seems to think all games and hardware are the same.

Handheld games are a market in itself and Nintendo is at the top of it. Just
because people own more smart phones doesn't mean they'll buy a Nintendo game
on it.

What does he care. It's not like he's going to buy "Super Super Mario World
TOUCH for iOS" for $30. It doesn't sound like he's a gamer at all and it's
sort of offensive when someone who thinks the latest tech will take over
doesn't consider the facts or any other factors.

Think about, why would you give in to your "competition" and make games for
their "console".

~~~
Steko
"Why can't console gaming still be a market and co-exist with touch screen
games?"

It can it'll just be a tiny market and any sensible company that wants to keep
making big boy profits will have to be part of the larger market. There's
still a few companies that make pagers, they just don't sell 50 million a year
like they did in 1990.

"Handheld games are a market in itself and Nintendo is at the top of it"

They are now in 3rd place. Standalone handheld gaming devices are under the
same pressure that point and shoot cameras and portable music players and all
sorts of other devices are under.

"why would you give in to your "competition" and make games for their
"console"."

Because your consoles flopped and you can make more money that way. Sega did
it. Atari did it. NEC did it.

------
rschmitty
"Nintendo isn’t just failing because their hardware is sub-par. They’re
failing because they continue to try to re-tool the Model T while the
competition is building Ferraris."

This has been Nintendo since practically forever, they have always been railed
on for their sub-par hardware milking it for as long as possible. Wii U might
not be selling hotcakes but I don't think this is Nintendo's death. Their IP
will keep the company going.

For anyone interested in the story of Nintendo (or just enjoys gaming history
in general) this is a fun read: [http://www.amazon.com/Super-Mario-Nintendo-
Conquered-America...](http://www.amazon.com/Super-Mario-Nintendo-Conquered-
America/dp/1591845637) (or listen for commute/jogging)

------
lawtguy
The author may be correct that Nintendo is in trouble and will lose against
Apple, Google, Samsung, Sony, Microsoft, etc. His mistake is in thinking this
means that Nintendo needs to do something right now.

As a thought experiment, imagine a bad scenario for Nintendo in 5 years.
They've been steadily losing market share and have eaten into their cash
reserves. They've launched a new console and a new handheld that are largely
seen as a flop. What are their options? Drop out of the hardware business and
just be a game publisher/developer or sell themselves to another company.
Basically the same options they have now. So they might as well stay the
course and see if they can come up with another hit as it's not really costing
them anything to do so.

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derefr
I would say, almost certainly, console gaming in general is already dead; all
we're seeing are its nails and hair continuing to grow. Hardcore gaming is on
PCs, casual gaming is on mobile, multiplayer is online.

There's only one thing consoles are good for now, and it's exactly the market
Nintendo already has cornered--local multiplayer gaming (your "Mario
Party"-like titles.) The only valid competitor for Nintendo's dollar, this
gen, is, _extremely_ surprisingly, the Ouya. Nobody else is publishing semi-
casual games you can play around a TV with your friends.

But that's still a small market. Nobody wants to play _single_ -player games
on a TV any more; they either want full online gaming experiences on a PC (for
which Nintendo could give two shits), or _personal_ games on a handheld. Which
is why, no surprise, Nintendo has been shifting their major IP from console to
mobile for years now. The "portable mode" of the Wii U is basically a
compatibility hack for this new paradigm, letting devs make single-player
games for the console, which can then be treated by the consumer as if they
had been made for a portable, as they've now come to expect.

I'd bet that six-to-eight years from now, Nintendo will be putting out a box
very similar to the Ouya, and also somewhat resembling the Apple TV. It will
be sold as a DS accessory to enable local multiplayer DS gaming, on your TV.
It'll be everything the Wii U is, but with four of those portables (notice how
much the 2DS resembles one of them?) And that'll be that for Nintendo making
consoles.

------
r0s
A very similar article could have been written before the original DS or Wii
debut.

And many were.

~~~
fivethree
Yet here we are, years later, talking about Nintendo's continued decline.
Band-aids are great, but when you're bleeding internally; they don't do much.

~~~
r0s
Years of inaccurate predictions aside, does the company have bigger problems
than new hit hardware can't solve?

Who knows, it's all pure speculation.

Can they hang on for years in a lul? Well that's pretty obvious.

------
gillianseed
While I don't see how Nintendo's 'death' is even on the table, I agree that
Nintendo's hardware endevours seem to be failing.

I expected them to have to fold in the hardware department sooner or later and
I'm actually surprised that they're still in it. I'm certain their handheld
devices will eventually lose to the smartphone/tablet, and the game console
market for 'casual' gamers where their hardware resides is losing to the
aforementioned aswell.

So yes, I believe that just like Sega (which have nowhere near the same
franchise power as Nintendo), Nintendo will become a developer for
Android/Iphone and PS5/XTwo or whatever the current high-end gen console is
when Nintendo finally get out of the hardware business (if the high-end
console market still exists then).

On the other hand, it's games, not hardware, which is what Nintendo is best
at.

They may be old hat, Mario, Zelda, Metroid, Pokemon etc, but it's those game
franchies which have sold and is still selling Nintendo hardware and not the
other way around. Zelda on Android, Mario on Iphone/IPad, i'm sure they will
sell massively, printing money even.

~~~
krisgee
I'd actually be incredibly surprised if they folded their hardware division.
Sure it's not great now (except the 3DS is still doing good by every other
metric other than compared to the DS ie: the best selling handheld in
history). There are ups and there are downs.

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acchow
Remember when Nintendo was the most valuable company in Japan surpassing
Toyota, Honda, and even MUFG?

How the mighty have fallen.

~~~
vor_
I also remember when they were tyrannical, monopolistic assholes who got
busted for price-fixing the NES and even sued to keep the Game Genie out of
stores. They've been stubborn and out of touch for as long as I can remember.

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Steko
This partially explains why the market discounts Apple's so heavily. Because
if your business is manufacturing hits you are going to either have duds or
miss waves depending on the POV. One dud you burn the profits from prior
successes and can the CEO, two in a row and you're out of business.

I hope Nintendo makes it through the Wii U debacle but it's not looking great.

------
pdknsk
I wonder why many Apple faithful are obsessed with what Nintendo does or
doesn't do, should do or shouldn't do. Maybe they're secretly angry that the
current CEO of Nintendo started programming on a Commodore PET, and not on an
Apple device.

~~~
Apocryphon
I see a lot of similarities between the two companies. A willingness to think
different in pursuit of their own hardware standards and form factors
(remember how the Gamecube used mini-discs and had a handle for carrying?),
huge success from pursuing the Blue Ocean Strategy, the capability to inspire
consumer cults (possibly because they are seen as somewhat "purer" than their
competitors), and even similar aesthetics (clean off-white plastic-porcelain
hardware, the lower-case letter 'i').

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Shorel
All Nintendo needs is to be compatible with the Occulus Rift.

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corresation
Why are the Apple zeitgeist all having such a fit about Nintendo right now?
First it was Gruber, then Arment, then the various hanger-ons and followers,
and now Siegler.

I just don't understand why that company has suddenly become so interesting to
them? Might they offer some guidance on the great PS4 versus Xbox One
decision?

~~~
jccalhoun
The most famous apple fans are also big Nintendo fans. Or at least they claim
to be. John Siracusa is the only one of them that I remember talking about
actually playing Nintendo games (even though he always says Mary-o).

Part of it is that for a long time people have compared Nintendo and Apple
(both make hardware and software, both have had iconoclastic leaders, both
have tended to go their own way contrary to popular trends).

But I think a big part of it is combination of the fact that the Nintendo 2ds
was announced and that all these apple people are friendly and follow each
other. So when one of them mentions something then the odds are that others
will mention it too.

~~~
endemic
Siracusa's essay is the only one worth reading:
[http://hypercritical.co/2013/09/02/nintendo-in-
crisis](http://hypercritical.co/2013/09/02/nintendo-in-crisis)

The rest of those clowns don't have much to add to the conversation.

