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"What is equally interesting to note is that the Revolution has not been mentioned at any Next-Gen meetings. Now, this means one of two things: We aren’t doing any Revolution launch titles (highly unlikely), or the Revolution isn’t coming out within the next 6 - 8 months so we aren’t worrying about titles for it yet. "
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Focusing on product innovation at the expense of commodity markets is a classic business strategy that is used successfully in non-game companies around the world. Companies like 3M are required as part of their strategic plan to have 30% of their revenue come from new products. They are constantly exiting markets when strong competition emerges and constantly competing with themselves by offering new products that outdate their existing products. Nintendo releases new genres where other companies release new products, but the basics are the same.
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What you find is that selling innovative products early on can be dramatically more profitable and less risky than selling commodity products. The early market might not be as large, but the money is much better. You see this over and over again. Nintendo sells less but makes more money. Sony and Microsoft sell more, but make less profit.
Consider this tidbit. The Xbox, which focuses on highly mature genres catering to hardcore gamers has production costs of $1.82 million a title. The Gamecube costs half as much at $822,000 a title. The real kicker is that the Nintendo DS only costs $338, 286 a title to develop for, even less than the Gameboy. Some of these costs have to do with the hardware and development kits, but for the most part they are derived from the scope of the projects. Being able to develop successful titles at 1/5th the cost of your competitors is a major boost to your bottom line.
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As a side note, folks who argue Nintendo should just make games for other platforms are completely missing the point. Nintendo needs to control their hardware platform in order to force innovation to occur in the control mechanisms. Other console manufacturers who rely on the hardcore audiences and standardized genres don’t see this need. They would happily standardize the console platform and make it into a commodity. Microsoft has historically made major comments about having one universal development platform.
The moment Nintendo loses control over their hardware, they lose a major competitive advantage in terms of creating new genres.
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A ‘gimmicky game’ is really just another name for a new core game mechanic that hasn’t been polished. Donkey Kong is considered shallow and gimmicky by children playing it for the first time in this modern age. Yet it sported the same core game mechanics that eventually blossomed into an entire genre of highly polished 2D platformers.
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"It is accurate that at this time we will not support high-definition [on Revolution]," confirms Nintendo of America's vice president of corporate affairs, Perrin Kaplan.
"Nintendo's Revolution is being built with a variety of gamers' needs in mind, such as quick start-up time, high power, and ease of use for development and play. It's also compact and sleek, and has beautiful graphics in which to enjoy innovative games," Kaplan says. "Nintendo doesn't plan for the system to be HD compatible as with that comes a higher price for both the consumer and also the developer creating the game. Will it make the game better to play? With the technology being built into the Revolution, we believe the games will look brilliant and play brilliantly. This can all be done without HD."
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"Companies focused on outdoing each other for technology's sake are using the power of public relations to confuse the media into thinking high-definition is a live-or-die part of the games of the future," says Kaplan. "It is a technological fact that games will still look incredibly beautiful and play incredibly well without the high cost of making them HD compatible. HD may be one of the technologies of the future. Is it the gaming industry's only future? We don't think so."
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"This is my single biggest worry," admits Eggebrecht. "Let's put it this way. At 640x480 [standard definition], we're at a point where we can do anything. Anything. Finally. But with high-definition, I think we're at about the same level of challenge when it comes to framerate as we are this generation. You can do a hell of a lot more polygons. You can do a hell of a lot more shaders. But the inherent fill-rate issues are still certainly there. Will it be a 30-frame time? Will it be a 60-frame time? It will be interesting to see."
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Europe's inability to settle on a unified HD standard stalled its plan to get rolling with the format. Now, the continent is set to use the same HD standards as America, but nevertheless manufacturers have been slow to gain momentum with the conversion just as Europeans have been slow to embrace it.
The Japanese market has encountered similar issues, which might explain why Nintendo, whose decision makers operate out of Kyoto, is unwilling to accept high-definition.