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Forums - Nintendo - Nintendo's revenue will decrease if it goes third party.

lol what a fail.
Under the same logic, EA and activision revenue would increase if they went exclusive.



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Of course they're going to make more money as a console developer than third party. Nintendo is cheap when it comes to output, expensive to all consumers and third parties. They won't be able to force their policies onto third parties when it comes to printing software and the highest cut of the big three for selling software or licenses to develop. With Xbox One and PS4 having other options for consumers, since third parties are developing for them, Nintendo's first party, now third party, titles remaining at full MSRP for the entire existence of their life wouldn't get supported like they do on their own consoles.  They certainly wouldn't see as many millions in sales as they do now with the games sitting at full MSRP year after year. 



It's kinda obvious. You sell US$ 300 and US$ 60 games. The consoles just add a lot of brute revenue. But keep in mind that profit isn't the same as revenue. The US$ 600 PS3 was a great revenue, but being sold at a US$ 300 loss it just killed the profit of anything SCE was trying to sell.

Edit: Just to clarify, I'm not saying that Nintendo hardware isn't profitable. As far as I know the 3DS is sold at profit and the Wii U at basically cost price breaking even with a game. I'm just saying that the OP's method to compare revenue and profit isn't correct because it's obvious that a hardware company will have higher revenue because consoles are way more expensive than games, but that brute revenue isn't a indicator of a healthy business simply because profit is what matters.

In 2013, EA profited around US$ 100M, Activision profited around US$1B and Nintendo lost around US$ 400M.



Did anyone anyone read my post?



Bet with Xander XT: 

I can beat more games on his 3DS than he can on my PSVita in a month. Loser has to buy the winner a game on his/her handheld Guess who won? http://gamrconnect.vgchartz.com/thread.php?id=193531

Me!

TheWPCTraveler said:
I can't see Nintendo surviving on mobile. (They'll hang on to paid apps.)
I can't see Nintendo surviving on PC. (They'll refuse to drop their prices considerably.)
I can't see Nintendo surviving on consoles. (Look at how long they've taken to develop titles for the Wii U.)

Besides, do you really expect someone who's been crying for Nintendo to go third-party to actually buy their games?


I would for sure buy Nintendos games if they released on Playstation!



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I have a pretty question.

*raise hand to the sky* Why the goddamn not Electronic Arts & Activision should make their hardware consoles?!



Vena said:
huiii said:

Wow.... you're not serious are you? 

Revenue =/= Profit

Profit = revenue - expenses

So if Ninty drop the console buissnes they make less revenue but also have less expenses (and considering the wiiu is or was sold at a loss the drop in expenses would be bigger than the revenue loss so profits would grow (or at least the retability would)).

 

i say this in every thread about finances and stuff but people need to get a clue about accounting before they go posting stupid stuff.


I am talking about profits, so don't make baseless assumptions. You should go look at their last 20-30 years of financials if you don't think that their hardware is a massive part of their profit margins as well as a synergistic machine for their software profits on which they earn 80% of the proceeds or, if digital, 100%. If they go third party all of that literally goes out the window.

Money lost on R&D is next to negligible over all. The rest of the money spent still has to be spent whether they are first or third party, and now they have even more expenses including having to pay licensing fees and tool kit fees which will eat up another 5-7$ a pop on each sale. Suddenly their profits per sale on software goes from 80-100% to 20-40%, if that.

You're totally exaggerating.  $7 out of a $60 game is 12% so I don't know how you are going from 80% to 20%???

Also development kits are not that expensive, and they can be reused for a generation.  It accounts for way less than 1%.



My 8th gen collection

The_Sony_Girl1 said:
Did anyone anyone read my post?

No idea about MS, they have some other stuff in their Xbox division that isn't gaming related so it's hard to know how much revenue the Xbox makes.

Sonys gaming branch has about 5000 employees half of which are making games, they made about $9.3 billion in revenue last fiscal year.



XanderXT said:

 

A 2013 comparison from Wikipedia.

 

Nintendo has 5200 employees. Revenue was 6 billion.

Electronic Arts has 9370 employees. Revenue was 3.8 billion.

Activision has 7061 employees. Revenue was 4.6 billion.

 

These numbers are outdated but it shows that Nintendo's revenue would significantly decrease as a third party publisher.

I mean EA and Activision with their DLCs and microtransactions still didn't make more money than Nintendo. This was both The Wii U's and 3DS worst year, yet despite having less employees than both, they still had more revenue.

Hahaha meaningless numbers without cash flow and profit margins ... I see what your trying to do but remember that more third party support would result in greater hardware sales which would increase nintendo's revenue and profits.

Nintendo's lose of third party support is limiting their target audience and customer interest!



XanderXT said:

 

A 2013 comparison from Wikipedia.

 

Nintendo has 5200 employees. Revenue was 6 billion.

Electronic Arts has 9370 employees. Revenue was 3.8 billion.

Activision has 7061 employees. Revenue was 4.6 billion.

 

These numbers are outdated but it shows that Nintendo's revenue would significantly decrease as a third party publisher.

I mean EA and Activision with their DLCs and microtransactions still didn't make more money than Nintendo. This was both The Wii U's and 3DS worst year, yet despite having less employees than both, they still had more revenue.

Title is true but the OP and OP's logic don't make much sense.

Nintendo makes a lot of their profit from hardware, hardware sales would either drop significantly or dissapear altogether depending on the degree that Nintendo became third party.

Pachter said a long time ago that since Nintendo has structured itself as a hardware company rather than a software one, it is dependent on its hardware sales.



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