Soundwave said:
And none of that would come even close to repaying that $3 billion dollar price tag. You'd have to sell 80 million copies of Dragon Quest or Final Fantasy before you see any red from that type of investment. It would be a terrible business move. Japanese developers are largely growing increasingly irrelevant in the game space. Final Fantasy is no where the brand it once was and Nintendo already gets all the Dragon Quest games. They'd be 100x better off in the game business investing in some new Western studios or even pursuing a deal with Disney that grants them exclusive use over properties like Star Wars, Marvel/Avengers, etc. And that would cost nowhere near as much and probably bump hardware sales higher on a global scale if the games were of sufficent quality. |
Actually, this is where you're very wrong, and this is the fun part. If we assume the exclusivity of all SE franchises results in 10 million extra units of Wii U being sold, acquiring SE would be 50% paid for before Wii U's life is done. I think this is a fair assumption since FF has a very dedicated fan base, and there is also Tomb Raider, DQ, KH and others to push Wii U's. So if they sell 10 million extra Wii U's, they make $10 off each Wii U going forward, the attach rate for software it 8:1 and the first-party proportion of software remains consistent with past Nintendo consoles we get:
| Units | Profit per unit | Total Profit | |
| Hardware: | 10000000 | $10 | $100,000,000 |
| 3rd party software: | 50000000 | $7 | $350,000,000 |
| 1st party software: | 30000000 | $34 | $1,020,000,000 |
| Total: | $1,470,000,000 |
That's nearly $1.5 billion without even considering any money SE is making. In reality, I think SE exclusively on Wii U would have an even greater impact, as it would push further 3rd party support and I can see 20-30 million more units of Wii U being sold. But 10 million is pretty safe.
What's possibly even more important is selling new consumers on the Nintendo brand. You want Wii U's in every home. A failed gen can have a lifetime of consequence. The benefit of reversing the terrible start of Wii U could be profound.
The problem with spending cash on new ip's and games is that consumers only have so much time and money. As we've seen with games like W101, they are often ignored, and seldom sell systems. People won't buy it because they want to buy FF already, and will buy a PS4 to play FF. As you have said before, creating an innovative, exciting new idea is easier said than done. NIntendo also needs to build the talent and resources to make such games, which would be an enormous task.
Picking up an existing publisher would provide the staff and resources to make AAA games right away. It would provide established brands to lure in buyers and convert them from competing products. It would provide a deep back-catalog which can be sold to conumers through eshop. Nintendo could also gain from SE's online gaming experience and powerful graphics engines. And it could quickly reverse the fortunes of Wii U, something new studios could never do.
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