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Smashchu2 on 20 June 2010
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famousringo said:
Smashchu2 said:
famousringo said:

All your post really does is highlight the fact that Apple has a very different business model than Nintendo in the handheld space. The fact that this completely new, and still rapidly evolving, business model has gone from 0% to 19% of US handheld software revenue in less than two years — and with no help from loss-leading hardware or 1st party development — would suggest to me that Apple really is a threat to Nintendo.

Look, it's really simple. There are three notable platforms for mobile gaming. Currently, Sony's platform is in decline, Nintendo's is maintaining speed and about to change course, and Apple's is growing rapidly. If Apple isn't a threat to Nintendo, who is?

Personally, I'm glad that Nintendo isn't as dismissive of Apple as you are.

On bold: How do we know Nintendo cares about Apple? We just assume it.

So having less then a fourth of the total revenue is a different business model then? In fact, I'm not sure what business model has to do with anything? Also, going from 0 to anything is easy. This does not mean they are growing a lot. It means they just started.

Also, let's not forget that this is the tail end of the handheld market. The DS and the PSP were out for 5 years and have already hit their peak in terms of software and hardware. And Nintendo gave very little support to the DS in 2009. What did we have? Spirit Tracks and that's about it (and Fire Emblem). Considering the IPhone only mustered less then a fourth of the revenue, I would not say it's a serious competitor. Let's see how it fairs when the other two guys have bigger software titles coming out. And, let's not forget that that 19% is spread over a lot of games.

The thing I find the silliest about the whole "Apple invading gaming," is there is nothing new about it. Mobile games have been around for a while. Let's hear it from Miyamoto though. He talks about how it was said that Mobile games on cell phones would take over the Gameboy. Well, did it?

LOL, you're the one who thinks the business model disqualifies Apple's 19% of the market because it's divided between so many titles, so don't play coy and pretend I'm the one who brought it up. You made a freakin' table about business models! You said that iOS games don't count because they're cheap to make and cheap to buy (where have I heard this argument before?).

You have some powerful denial going on if you think the App Store is just a re-run. No software market has ever existed like this before. It's never been so easy to make, sell or buy software on any previous platform. No mobile phone has had a billion dollar software market before now.

I believe Iwata cares about Apple because he's a bit of an Apple fan, and I have a hard time believing that the man who built Nintendo into the beast it is today would twiddle his thumbs while a new competitor encroaches on one of his key markets.

The word "business model" is overused here. A business model is just how you make money. Burger King's business model is to sell you burgers fast. McDonald's business model is the same: sell you burgers. Their strategy is how they differ. 

Margins have nothing to do with a business model. A margin is just your sales minus Cost of Goods Sold. What I was arguing is that just because you can have a lower margin by percentage of sales, it may not be better because the selling price is lower. If you sell a game for $5 and it cost you $2 per unit. That's a 60% margin. Now, let's say you sell one for $50 and it cost $45 per game. Well, that's a 10% margin. That's not as good as a 60% one. But in fact, it is better. Because you sold the game for more, you made more money. Precents are very easy to abuse. If you want to discuss the math, make sure you try to use absolute numbers rather then precents. Industry analyst abuse precents all the time. Again, the table has nothing to do with business models.

I know iTunes is disruptive, but I have heard nothing about the apps store. From what I can tell, it's no different then the Wii Shop Channel. it's a venue to buy digital software.

Also, just because Iwata likes Apple doesn't mean they are a threat (they aren't even in the same business). Heck, how is Apple a competitor. The iPhone doesn't compete with handheld systems. It competes with smartphones. I'm not sure how you or anyone else comes to these conclusion. And how is what you said proof that Nintendo sees Apple as a threat. They have done nothing in respones to Apple.