Nikkei has published another interview with Nintendo president Satoru Iwata, this time in English. Iwata spoke about Nintendo’s poor financial performance as of late, those who are concerned about the company’s business operations going forward, and more.

Iwata also mentioned the need to “abandon old assumptions about our businesses”. This includes M&As (mergers and acquisitions), he said.

Head past the break for Iwata’s comments in full.

On what caused Nintendo’s poor performance…

Nintendo has undergone continuous changes over years, moving from Hanafuda playing cards to video games, and offering newer systems like the Wii. But we’ve been preoccupied with a fixed idea of what a game should be like. The game industry is at a turning point amid new developments like the rise of smartphones.

On those who express concerns about Nintendo’s business operations going forward…

Mr. Yamauchi (former President Hiroshi Yamauchi) often said “Shitsui-taizen, Tokui-reizen,” meaning that we should act regally when things are bad, and be calm when things are going well.” Were he alive now, he would tell me to carry an air of confidence.

We built up cash reserves when earnings were strong. Because the entertainment industry ebbs and flows in wild swings, Mr. Yamauchi insisted it is vital to have deep pockets. Without savings, we could not have recovered from a single failure in game systems. Even now, we can afford many options because of our robust financial standing.

On Nintendo’s specific strategies…

We’ll change the way we sell products, by managing customer information via the Internet. We’ll offer discounts to steady, regular customers. We’ll cultivate emerging markets and launch new businesses in health and other areas. In an emerging country, you can expand the user base only after you offer a product line different from advanced economies in pricing.

We should abandon old assumptions about our businesses. We are considering M&As (mergers and acquisitions) as an option. For this reason, we’ll step up share buybacks.

On whether delisting would be an option when Iwata thinks about management over the long term…

Quarterly earnings reporting is not a good fit for Nintendo. We don’t know in advance how much of a hit a product can be. Even when we make plans thinking that a goal is reachable, sometimes things don’t go well and this ends up upsetting (shareholders). But it is thanks to the stock market that Nintendo has grown to what it is today. I don’t want to turn to a management buyout just because we are inconvenienced now.

"On Nintendo’s specific strategies…"

Pity. Read nothing about learning from the competition (I read articles that Nintendo doesn't own Xbox/PS consoles to see what they do), and investing in modern online features/infrastructure.

well he did say they were planning to make a system that transfers all your purchases to your future Nintendi consoles/handhelds through your NNID, tying games to NNID, an something about games getting cheaper the more you buy/play IIRC

The prospect of mergers and acquisitions seems very interesting. It's become very evident Nintendo can't rely on 3rd party support so they need to expand in order to supply a steady stream of games.

I think Iwata focus will be more on Quality of Life Platform which is something in Health/Fitness sector and not related to living room type gaming. I think any M&A will probably take place in that space.

The Wii U is already being abandoned by Nintendo. They will not be "spending" to recover it. They will merely try to hold on to the Nintendo "loyalists" by providing 3-4 games a year for the next 2-3 years. Since the install base is small, they need to keep cost of those games down so they wont be accelerating the development schedules by staffing up either.

Just realize, Ubisoft has 1000 people working on Assassin's Creed and another 1000 on the next Assassins Creed to keep up that yearly release and that is just one of their "games". Meanwhile Nintendo has total of 5000 employees for their whole organization. I think Zelda team is around 100 people or so.

actually 7000 now since they are expanding

Zelda SS had 200 or so and Mario 3D World had 100 which is a lot since they usually have like 30 or so people on a 3D Mario

"We are considering M&As (mergers and acquisitions) as an option."

Potentially really good news for Nintendo fans. They need to increase the depth of their catalog. Nintendo home consoles appeal to a small group, especially compared to the 3DS. It's almost embarrassing how little Nintendo, with their "deep pockets", has spent in this area.

However, the bad news is how late Nintendo management is at reacting. They are years behind Microsoft and Sony in a lot of areas that have become industry standards. That needs to be fixed.

Honestly, I think one of the major turning points for Sony was when they decided to start listening to guys like Naughty Dog and Santa Monica. Talking to world-class western developers gave them a perspective that they definitely lacked during the development of the PS3. The same kind of thing, with a strong western presence in their management decisions, could really help them. The video-game industry is world-wide and requires vision that encompasses that fact.

now the question is who should Nintendo acquire?

Just like they abandoned the Gamecube right? Considering Gamecube managed 45 first party titles during it's life cycle, I believe we will see an average of at least 8 first party games per year (including games to whomever they outsource or publish). Nintendo has increased their staff by 40%.  It's would be safe to assume that Nintendo is not abandoning the Wii U anytime soon and there was nowhere in the interview where Iwata implied that. A shorter lifespan than the Wii is plausible (5 years I predict). 

That is the question. I would like to see them aquire Platinum Games. I believe they would make an excellent Star Fox.I would also like to see them to try and recruit Michael Ancel into their ranks as I beleive he would be alot better off with Nintendo than Ubisoft.