RolStoppable said:
First off, your article was a fair writeup for the most part and I read it in its entirety. In the home console hardware section you've the NX pegged for a March 2016 launch, you might want to correct that. However, I am not satisfied with the handheld sections. For one, you have that comparison between 3DS software and Clash of Clans to highlight how big mobile games are. Okay, so there's this one huge mobile success, but it's obviously far from the norm that a mobile title accounts for roughly 5% of all revenue ($1.4 billion out of $30 billion). This is one of your fun-fact-of-the-day stuff. Secondly, and this is much more important than the previous point, there's no mention about Nintendo's future as far as handhelds go. You are treating NX as a home console, but Nintendo has obviously spoken about a more unified development approach in previous investors briefing, so somewhere there has to be a handheld component in the whole NX affair. Especially because the 3DS is the bestselling dedicated hardware in Japan by a comfortable margin, so the mere thought that there won't be another Nintendo handheld is preposterous. Now for the quote above, I don't think it's fair to say that Nintendo has proven that a console with Nintendo IP as the main USP can't sell, because the Wii did just that. And before you say motion controls, you have to remember that a video game system is nothing without games. Therefore Nintendo IPs were the main draw. It's also the same situation with handhelds which were always dominated by the sales of Nintendo software and have consistently cleared the 50m mark in hardware sales. Nintendo IPs are very much a reason to buy Nintendo hardware. What the Wii U is proving is merely that Nintendo IPs can't sell just about everything. I agree with you that a triplet joining the current twins will result in failure, but the situation overall isn't as hopeless for Nintendo as you make it seem. It shouldn't be forgotten that both the 3DS and Wii U were handicapped by hardware decisions for their entire lifetimes, so merely the absence of things that put people off should already improve Nintendo's chances to be more successful with NX. (The 3DS has the inevitable connotation with 3D, and that's something a lot of people would rather not have in their entertainment. The Gamepad is a controller that nobody asked for and virtually nobody likes to play with, but it's the central part of Wii U. Changing the image of a system is a very hard thing to do.) If NX's unique concept resonates with the market, if the hardware is affordable and Nintendo's software release schedule is steady, then it should actually be quite easy for Nintendo to be successful, especially because the idea of synergies between the dedicated gaming hardware and the smartphones businesses will benefit even more. But even if NX fails, it should have high sales of Nintendo software anyway. And if Nintendo doesn't commit hardware mistakes that force them to sell NX at a loss, then the failure won't be as bad as it was for the Wii U and 3DS when we are talking about Nintendo's bottom line. In that case Nintendo will obviously be financially stable enough to launch another round of dedicated gaming hardware. Basically, I strongly doubt that an NX failure would mean game over for Nintendo consoles. |
Thanks for the post Rol. I've corrected the date to March 2017, good spot!
The Clash of Clans comparison, as you say, is just a small fact. It's not really there to say that Nintendo could earn that much from one game but instead to point out how huge mobile gaming is today. I could very much do the same by providing total revenue numbers for dedicated handheld and mobile gaming and the gap would be even bigger. I wouldn't read too much into that to be honest.
Yes, no denying that Nintendo will take a more unified development approach with their next generation of systems. Creating one software ecosystem in order to streamline development etc... I think a new handheld would still do well in Japan but the market for a dedicated handheld outside of Japan is very niche these days and whilst Nintendo could of course launch one here, I wouldn't expect it to do as well as the 3DS has done outside Japan.
The Wii was a unique case as the games were created specifically to take advantage of the system features. For example the GameCube and Nintendo 64 too had great first party line ups but there wasn't anything else that was unique about the consoles to push sales above their competitors, even when they had the price advantage. I agree that Nintendo IP do sell hardware but that on its own won't be enough this time in order for Nintendo to see success.
I see your points on 3DS and Wii and don't disagree there at all. But that doesn't disagree with my point either. I'm not saying that the situation is hopeless for Nintendo, I'm saying it's a difficult situation for them where having another Wii U would not work in their favour one bit.
The good thing as you say is that Nintendo are clearly working hard on ensuring the launch has enough software (they've said as much) and that the hardware's USP's are relevant to the market today. As to how easy it is for Nintendo to be successful, it's hard to say because so far they haven't shown anything that can make me say they'll do well or that they'll do bad. My point was more along the lines that if they do badly then they've now got the Wii U and 3DS discontinued and a poor selling console (NX) unable to generate growth or high revenues etc... That, coupled with the fact that new revenue streams haven't taken off just yet could just mean that Nintendo don't look to launch another console.
In regards to smartphone business I can see how that may drive new users to console but I wouldn't expect it to have a huge impact to be honest.
