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Akvod on 23 March 2013
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noname2200 said:
Akvod said:

I thought Michael Pachter had a pretty simple and compelling argument. You mainly make money off of consoles by:

1) Royalties/Licensing fees from third party games.

2) Selling your consoles at a profit

You forgot 3) Selling your own games.

Not joking: at the rate Nintendo games often sell, the royalties they save by being first party have to be pretty monstrous.


It sounds like you're assuming that Nintendo's software business is profitable because of the existence of a Nintendo hardware (which I think is a plausible argument).

 

Now can you elaborate more? Can you give a convincing argument why total sales for a Mario or Zelda game will be less if it was sold under 3 or 2 consoles, as opposed to 1? Less enthusiasm/brand awareness? Mismatch between the segment that own a PlayStation/XBox and the segment that buy Mario/Zelda (that is, without a Nintendo console, parents won't buy their young children a console and old school Nintendo fans will refuse to buy a Nintendo game that goes 3'rd party?)

 

Pacther's saying that Nintendo will basically be able to sell to triple the number of people they could sell (assuming that the WiiU, PS4, and 720 have equal sales) if they were first party.

You're arguing a combination of lower margins (due to royalties) and/or lower sales volume. And honestly, it doesn't sound that convincing. Will Nintendo fans really get that upset and refuse to buy a Zelda game that goes to the PlayStation or Xbox (so much for loyalty)? Will PlayStation and XBox owners not buy a Zelda game? Maybe you could argue that not many Xbox owners will buy a non-shooter game, but again, Pachter is saying that Nintendo will be selling X number of games to Xbox owners ON TOP of the number of games they would sell to WiiU.

Again, Pachter's logic is basically you will sell roughly 3 times the number of games by you would sell by going multiplatform, as opposed to exclusive. You obviously need to adjust it here and there (not all three consoles will have equal market share, less potential buzz for non-exclusives, segment mismatch), but the logic is simple and sound.

You're going to have show that the increase in game sales will actually have to be NEGATIVE. That Nintendo going 3'rd party will actually result in their games selling LESS than if they were first party.