To me, it all comes down to this:
Pressure will likely mount on the architect of the Wii success in 2006 to step aside or shift course to focus on making money from “Super Mario” and other software titles. Nintendo so far has refused to allow its games to be played on machines built by competitors or on tablets or other mobile devices that are used by gamers.
The pressure is building. Nintendo needs to either reinvent themselves entirely, shrink to focus on their handheld success, and/or start licensing franchise brands like Zelda and Mario to Microsoft or Sony.
Nintendo will be around for a while, no doubt. They project a loss of about $335 million this fiscal year and they have about $14 billion in the bank. That’s excellent news for them and gives them plenty of planning time. I worry that their hand-held business might deteriorate once the phone game controller market matures over the next few years. The longer they wait, the fewer the options.
Jim you cant compare the quality of Nintendo games with anything from android/ios. 3DS is selling like hotcakes. Telling Ninty to publish its games on Sony/MS is like asking apple to distribute mac os at various pc OEM’s. As you said Ninty has a lot cash in the bank and its currently more valuable than all of Sony corp not just Sony’s gaming department. The real problems with Wii U is lack of 3rd party games and online lack of features due to Nintys Japan attitude against the East gaming culture. We will see in long term if Sony and M$ could maintain their current selling momentum with their next gen consoles. 3DS was also a failure in its first 1.5 year…. time will tell heaven or hell.
I don’t believe that phone game controllers will shoot a hole in the ship that is Nintendo. 3DS is a major success, as was every other handheld Nintendo console before that. As DJTaurus said, (although to Jim, who didn’t write the article), asking Nintendo to license its games to Sony or Microsoft (or Apple or Google, for that matter) is exactly like asking Apple to license OS X or iOS to Samsung or Dell. Nintendo has stated that, much like Apple, “Working With Both Hardware And Software Offers Nintendo Strong Advantages”
I guarantee both Nintendo and Apple would rather go down with their honor intact. Not that that’s gonna happen for Apple anytime soon.
telling Nintendo to throw in the towel now is like telling Apple to throw in the towel in the ’90’s. Nintendo has loyal customers and great games, the hw is quite good too, The 3ds is terriffic, I just got one in December and have been enjoying the latest Zelda game immensely.I do not believe the phone game controller market will go anywhere anytime soon, everything so far has flopped and developers are not writing for them.
The 3DS is not a major success. It was a failure in every way until an embarrassing price cut. Since then they’ve managed to sell a few units, but it lead them to their first yearly loss and foretold the woeful Wii U launch. 3DS hardware forecast for fiscal 2014 was also revised downwards, just happens to be less incompetent or fraudulent than their disgusting 9 million forecast for the Wii U that someone should probably go to jail for.
Maybe it would help if they tried making new games. They just keep slapping Mario on something or repackaging old Zelda games. They should make a proper Metroid game again, and not that FPS Prime abomination.
They should start making new games, by remaking an old game. Killer logic.
Everyone keeps saying that Nintendo must make games for the Playstation and Xbox. Sega tried that and look at them now…
As for phone game controllers, I expect they’ll be about as popular as 3rd-party styluses are for phones.
which is it? Make new titles or remake old ones?
Actually, the 3DS was the best-selling console in the US for 2013:
http://kotaku.com/nintendo-3ds-was-top-selling-system-of-2013-because-it-1503082139
It’s a shame because I really like the Wii U. I do think they released it before the software was read — it was so buggy when I first got mine. But it’s been solid lately. I really enjoy it.
They need to stop dragging their feet on getting the classics like Smash Brothers shipped on Wii U.
3DS outsold XBox One, and PS4 in December 2013, and as Zepfhyr mentioned, was the best selling console in all of 2013.
Yeah, like rehashing franchises aren’t working for the other consoles. Oh yeah, Call of Duty, Grand Theft Auto, Forza, Gran Turismo, etc. I could go on.
Why does this start with “actually” when it doesn’t contradict a single thing I said?
Thanks for the sentence unrelated to what I wrote.
This. Everybody who thinks going third party worked well for SEGA has forgotten how great SEGA was in the past. Sure, they survived, but they are a shell of their former self and almost irrelevant.
Got a Wii U for Christmas. Love it. So do my kids. Nintendo did have a problem with lack of good titles, but that’s changed. Super Mario 3D World is fantastic, as is LoZ:Wind Waker, and Pikmin 3. Lego City Undercover is good too.
There’s enough good Wii U titles to keep all but the most hardcore gamers entertained for months. But they need Metroid Prime, Super Smash Brothers, StarFox, and Mario Kart titles too to keep it going. A few third party exclusives wouldn’t hurt either.
It is related. Shows the 3DS sold well in 2013. Games for the platform are among the industry’s top sellers as well for the year. You’re just trolling. Your account name even suggests it.
Agreed with most of it. But his name is Dave. 😉
Seriously, they could improve online, but I would hate to see it get voice chat like XBoxLive. That’s a cesspool of delinquent teenagers swearing at you. Nintendo could not get away with that.
Where did I say it didn’t outsell the Xbox One or PS4 in December, or that it wasn’t the best selling console in 2013? It just wasn’t a particularly massive success and, as the forecasts revised downwards show, it didn’t even sell as well in the last fiscal year as nintendo thought it would.
Outselling both brand new consoles in the Christmas season is a major success in my book. Adjusting forecasts downward doesn’t make it a failure, it just makes their projections a failure. You would be correct in saying “Nintendo’s sales projections were not a major success.”
Because most people believe being Number 1 in sales in a competitive market is a major success. I could be wrong, but you seem to believe it’s based on projections. Would you be a financial analyst, by any chance?
Me too. I enjoy it, my kids enjoy it, and we don’t, not even for a second, wish we had an XB1 or PS4.
Where did I talk about projections, besides the fiscal year forecasts for 2014 released by Nintendo itself which are the subject of the article? I don’t really have any idea what you are talking about, and you appear to be responding to someone else entirely, who is writing things I never wrote nor believed. Not a very fruitful conversation.
The Nintendo forecast revised 3DS sales down to 13.5m from 18m, so it has not sold to their expectations during the first three quarters of fiscal 2014, as I said.
and Mario Kart, Metroid Prime, and Starfox.
I wish they’d do more in the sports category too, but concentrate on game play a little more. Mario Strikers was a great game. Mario Baseball was not.
It’s very easy to outsell something by cutting your price. I don’t understand your point.
“Where did I talk about projections?
Probably in the three posts where you mentioned they revised their forecasts. Forecasts are projections.
We could debate what means “very easy” all day long, but the fact is people aren’t going to lay good money down for a console they don’t want. And more people laid good money down for a 3DS than an XB1 or PS4.
They’re Nintendo’s own projections after seeing their own sales from the holiday quarter? I don’t know what you want from me. The 3DS is either selling below expectations, like everything else they sell, or they fraudulently inflated their forecasts, or both.
You said that they “managed to sell A FEW units” (emphasis mine, obviously), which implies that it did not sell well. As you pointed out, they have lowered their guidance for the quarter ending in March, but that does not mean that the 3DS did not sell well this holiday season. In fact, it’s the Wii U itself that is responsible for Nintendo’s loss, not the 3DS.
I had no intention of contradicting any of your stated facts, but rather your use of fuzzy language to imply that the 3DS sold poorly this year when it did not.
They need to lay down a lot more “good money” for the latter two things, which was my point, yes.
That was clearly a glib remark, I know precisely how many units they sold. It’s after their embarrassing price cut that made them sell at a loss for a while and post their first annual loss that has continued to this year, as I said.
And I wouldn’t say declining 3DS sales and revising their 3DS hardware units forecast down 25% is “selling well”. I can only interpret that as sales not meeting their expectations for the holiday season. Perhaps you think that their forecasts were just fraudulently inflated, though.
We don’t know that 3DS sales are declining from the information posted, only that Nintendo expected to sell more for the fiscal year than they actually did.
Unless and until they release actual sales numbers, we can’t say if their sales declined or not. We can only assume that their sales were lower than the company had anticipated, which is something quite different.
Their revised forecast is lower than the previous years sales, is what I meant, precisely. I presume this means their sales so far have been flat or declining year/year, but of course, it’s a forecast. Maybe 6.2m people will buy a Wii U by March, in some sort of miracle, and they’ll actually hit their ridiculous 9m forecast.
I’m definitely not arguing that the Wii U sales projections are likely unreachable. Something major would have to occur to create such a shift in the landscape (such as unbundling the GamePad or releasing a surprise exclusive that drives massive sales, both unlikely before the end of March).
But the 3DS projections, despite being lower than initially stated, are still doable and will still result in quite a large chunk of change for Nintendo. There is no doom & gloom on the horizon for the 3DS at the moment, especially with such a strong library from 2013 and strong expectations for 2014 releases.
This is where we disagree. You are tying the definition of success to forecasted sales. i.e. if they don’t sell the numbers they expected, then it’s not a success.
I am tying the definition of success to sales relative to the competition, with the assumption that the platform is still profitable.
Now if it comes out that Nintendo is selling 3DS at a loss and they aren’t going to make it up with game license revenue, then you will be right. But I don’t think that’s true. I think Nintendo’s losses are more tied to the Wii U than the 3DS.
I don’t tie the definition of success to forecasts. It’s just another datapoint. The main sign of failure was the completely failed launch that led to an embarrassing price cut and their first annual loss in this current streak, as I’ve said repeatedly.
If your sign of success is sales relative to competition, then perhaps you shouldn’t cherry-pick from the television game consoles. There’s a whole world of smartphones providing competition that you’re ignoring for that hardware unit sales/revenue/profit comparison.
At this point there’s really nothing Nintendo can do to spur huge sales of the Wii U to where they need it to be. They have Mario Kart 8 and Super Smash Bros. coming out this year, but while they’re popular titles they’re not big system sellers and never have been. They’re not successfully advertising the console. From the very beginning there was confusion as to what it exactly was. The design of the console is outdated, not appealing at all to western gamers aside from those who grew up playing their games, and too similar to its predecessor. There’s little to visually differentiate it between the Wii as the games look like high definition Wii games. There has to be something different about it to spur sales, and it simply doesn’t have that for most people.
They blew it with Super Mario 3D World because they needed a big title to drive console sales during this Christmas. It was either have a good amount of sales this Christmas or bust. It’s an amazingly well done game and is in reality better than anything offered on the PS4 or Xbox One, but it’s not immediately impressive to most people. It’s perceived as being overly silly, even. They needed a game to knock people’s socks off like Super Mario Galaxy did on Wii. It had gameplay that was different and copied by competition for many years afterwards along with an audio experience better than anything provided in that generation with its orchestrated score.
Nintendo is projected to lose money this quarter because they expected Wii U sales to be much higher than anyone living in reality would suggest. The Wii U will sell well enough for them to make a profit off it if they stop projecting unrealistic sales for it. They ordered manufacturing of Wii U consoles well in excess of what actually sold, so that is where the lion’s share of the losses went. They will eventually sell their stock as it’s selling at least well enough for that. They need to return to the reality of the product they have and work with that. Aside from the quarterly profit loss it’s not unprecedented for Nintendo as sales of the Nintendo 64 and the GameCube both were disappointing.
The Wii was an anomaly, a fad. Its motion controls were novel for the day, and the fact people could get up and move to play a game caused a fad and an increase in sales to people who wouldn’t otherwise buy video games. That caused Nintendo to sew up the new casual market quickly. Just as quickly as they got that the entire market was consumed by Apple due to the fact casual, crap games weren’t being sold as $50 AAA titles on the devices and because of the convenience of having it with you all the time.
Apple has consumed the casual gaming market which killed the Wii’s sales late in its run. It hasn’t made a dent in the handheld market as Nintendo who has had the entire market sewn up since the market’s conception is on track to sell more 3DSes than they did DS systems, and the DS outsold the Wii by a lot. Nintendo’s big success last generation wasn’t the Wii — it was the DS. These phone controller things won’t cause Apple to consume the handheld market because these devices don’t ship with and aren’t part of the phone and therefore few games will utilize it. They’re clunky by design because you’re inserting a phone into a game controller which makes using the device as something you carry around in your pocket absurd. Games on touch devices will continue to be constrained by their lack of feedback buttons. Unless the entire public loses interest in immersive games there will continue to be a market for dedicated handheld gaming devices.
Nintendo is okay. They don’t need to license their property just as much as Apple didn’t need to license Mac OS, and Nintendo isn’t remotely close to scraping the bottom of the barrel as Apple was. If they keep their sales projections in reality they will make a profit off the Wii U based upon their their fanbase and their own first party titles alone. Nintendo if anything is remarkably good at generating profit.
If they were remarkably good at generating profit you probably wouldn’t be posting a comment on an article about their third consecutive annual loss.
I’m not arguing the launch and I couldn’t care less if you consider the price cut “embarrassing” or not.
I’m judging it on the sales today and the assumption it is profitable. It is selling better than others in its market, and there’s nothing to indicate that it isn’t profitable. If you want to give me data to show me it is not profitable, then fine. But if not, there’s no point discussing it further.
Probably in the lifetime of the 3DS they’ve made a small profit, or will, after digging themselves out of a launch hole. Doesn’t really sound like a “major success” though, and certainly not enough of a success to counter the rest of their blunders. Perhaps your definition of a “major success” is to be profitable at all though, seems like an incredibly low barrier.
And every year since 1889 until 3 years ago they made profit. 🙂
Losses two years ago were due to unrealistic projected sales of the 3DS (and it now sells well in excess of their projections then) and losses last year and this year were due to unrealistic projected sales of the Wii U.
It’s not as if the Wii U is their first hardware flop.
If it means the company can continue to exist, third party developers can profit, and they make future platforms, it’s a success to me. Anything more is just gravy.
I had zero interest in the Wii U until I saw they remade The Wind Waker, and that Pikmin 3 was out. I wouldn’t even care if Nintendo just remade all of their best games in HD, or with redrawn graphics…I’d buy them all. I’ve played those 2 games from beginning to finish 3 times.
When I saw the Wii U announced, I thought the GamePad was a gimmick. I now know it’s not a gimmick at all, but they seriously hobbled it. Considering all the cash they have, it’s foolish for them to continue to build such conservative systems. It made absolute sense with the Wii, but as soon as I saw the Wii U, I knew it was going to flop. And I’m a fanboi. All I ever buy are Nintendo consoles. I bought a PS3 for the bluray & The Beatles Rockband, and that’s it. It otherwise collects dust. I still have my NES, SNES, N64, and GameCube. I gave my Wii to a friends kids and rolled all my VC games and saves into the Wii U. If the Wii U were just a bit more comparative to the other next gen systems, and could handle more than one (or two) GamePads, people would get excited. I know it’s not their style, but at some point they have to compete.
I’m happy with the Wii U, and all I care about are the 1st party games, but I get nervous when I see Nintendo refuse to acknowledge which way the winds blowing. Innovate, but keep yourself relevant.
I spent too much time on this.
Oh okay. Maybe next time just post “possibly profitable” instead of “major success” and you can avoid a whole conversation.
Profitable with more people owning a 3DS than an XB1 or PS4 (i.e. the competition) is a major success to me. Profitable is not the measure to me, but it is a prerequisite. Because it means they can continue to produce products in the future.
I didn’t want to avoid the conversation. That’s why I posted a differing opinion on what success meant.
As I previously mentioned, you’re cherry-picking competition there. They have much more directly comparable competition that they are far behind.
True. There is the PSVita. As for iOS and Android devices, that’s a whole other tangent I’m not willing to dive into right now. Too complex with too many unknowns to determine how much direct competition they really are.
To me it all comes down to this:
Games.
Software sells hardware. Period. WiiU is not doing so well right now because it doesn’t have a strong software library. It only has a handful of excellent games. Very similar to the 3DS during its first year, which Nintendo dealt with and now has one of the best libraries of any console. Its not Nintendo’s strategy that is so much causing their problems, its the WiiU’s lack of killer titles. And that can always be changed.
The iOS market even with the new MFi controllers still can’t replace a dedicated console for the core audience of gamers. Gamers who are willing to spend $40-$60 for AAA high production value games like Zelda and Mario. I don’t like the thought of the gaming industry succumbing to the “quick fix” cash cows on iOS. Not that I don’t love these kinds of games, I just want deeper more emotional and artistic games as well. Everything has its place, its not a zero-sum game. Consoles don’t need to fail for mobile to succeed, and vice versa, they can coexist peacefully.
OEM’s = OEMs. Plural, not possessive. We need to sort this out.
’90’s = ’90s (an abbreviation plus a plural, but not possessive). You were so close.
Pressure is mounting… from whom? From iPhone owners who want Nintendo to make free to play skinner boxes instead of the fantastic games they make now?
Apple’s App Store incentives have effectively destroyed the market for real, good, full-length games on iOS. The idea that Nintendo will magically turn this around, and turn the App Store into a great marketplace for real games, is probably completely unfounded.
Even on failing systems, Nintendo sells millions of copies of its games at 60$ a pop. There’s absolutely no hope that they will be able to replace this revenue with App Store Apps without resorting to the same psychological tricks that make free to play games successful.
There is no market for Nintendo’s games on iOS. The only way they can succeed is by making games that look like every other successful iOS game. And that’s not something I’m looking forward to.