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Armour1 on 30 December 2015
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Miyamotoo said:
Teeqoz said:
Nintendo's main profit driver is software sales. Their 3rd party royalties are basically nonexistant at this point, and while Nintendo normally does make a profit on hardware sales, it's hardly as much as they make from software.

If the money they'd get from increased software sales from launching on a tremendously bigger userbase outweighs what they lose from 3rd party royalties and hardware profit, then they should go third party. Neither us nor Nintendo knows if it will though.

Nintemdo are in a peculiar position among the three platform makers because of exactly this. MS and Sony's primary profit drivers are 3rd party royalties and subscription fees, both of which are things that they need to maintain their own platform to keep. Nintendo's main profit driver is in no way tied to their hardware, and could potentially benefit a lot from a higher userbase. This is why Nintendo going third party is in no way as silly as someone make it out to be.

To end it, I'll say this: It's not about wether or not they make money at all as a platform maker, but if they can make more as a 3rd party.


*raises flame shield*

You probably dont know, but half of profit Nintendo is making from hardware and addons for that hardware. Do you know how money Nintendo made just from selling Wii Remotes, Motion Plus, Nunchuck, Wheels...whitout profit from hardware!? For instance build price for Wii Remote was around $10-15 and Nintendo were selling then at $60, and they sold tens of milions (probably more than 100m) of Wii Remotes.

Second is when you have your own platform you don't pay royalties to anyone, you have whole profit just for itself.

Not to mention that when you have your own platform and software you have completely freedom and control of your whole business.

 

And how much did profits off hardware drop going form wii to wiiu.

What happens if the next console sales even less.  Going by ninty hardware sales drooping, be it console or handheld.  Fact is at a certain point the user base wil be to small to make hardware finencially viable, at a certain point even software will fail is the user abse is to small.

What good is your own platform when 3rd parties shun it and it struggles to sale 12m.

Yes PS and xbox would enslave ninty and force them to make cod clones, no freedom lol.