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NWR Feedback / Games Business 101: A Counter-Editorial.
« on: February 28, 2003, 02:33:06 AM »
First of all, I just want to make this clear: My intentions aren't to slander Rick's hard work, tell Nintendo how to do their jobs, nor to spray some controversy around. But there's two sides to every story, and I strongly feel that some of what was mentioned in here is very-much open to debate.

Let's begin with this:

While gamers like to think that every company wants to have the most market share and be “Number One”, there’s little point in doing that if it costs you money.

Fact is, it does cost money to make money. Granted, this is taken from what is practically an introductory paragraph, but this entire point conflicts with some of the latter business 'suggestions':


To “win” in the future, Nintendo would need to focus on the next generation of consoles, and meeting or beating Sony and Microsoft to market.


Nintendo will need to make sure they get great performance at a good cost, but not be afraid to compete at the same price point.


While there are many consumers that will pass up a Nintendo console in favor of a “do-it-all” box, Nintendo isn’t likely to win those consumers anyway.

So what we have here is the suggestion that Nintendo need to launch first, with similar but competitive performance, and minus 'set-top-box' features - because hey, clearly no-one will go for that frivolity... The end result, in theory, would be Nintendo regaining some ground in the market place.

In reality however, research and development of a new console takes hundreds of millions of dollars, and years of careful planning. For reference-sake, Sony is spending something upwards of $US 250 million developing a new processor, let alone DVD componentry, and whatever else they decide to put into their system. Moreover, they announced their intentions last year.

For Nintendo to 'get ahead' so to speak, they would need to follow suit - Invest money in a new chip, get through all the R and D formalities, design and manufacture the console itself, AND have the greatest launch title (

Nintendo needs to remember what got the Nintendo 64 all the cheap pre-launch press … and that is an absolutely stunning launch title.
) ready to ship well before Sony or MS. The sooner you want something to launch, the more it's going to cost. The sooner you launch with this costly technology, the sooner it becomes a) obsolete, b) the new high watermark that drives the competition to excel beyond, and c) will forever be compared with and used as a measuring stick, in terms of graphics.

As you can see, there are serious problems associated with rushing to the market. Look at the Sega Saturn's launch in the US, a near-disaster of (IMO, excellent) 2D technology, dressed up in weak 3D abilities, pushed out the door to get the jump on the mysterious 'PlayStation' and its polygon-pushing claims.

As for incorporating DVD functionality into the Nintendo-equation, it was said that certainly some sales will be forfeit, if it isn't included. Assumedly, removing DVD functionality lowers the cost a little, but the people have spoken. Multiple functions shift consoles. This is all the rationale Nintendo need to include this in their system. As was said, it cost them sales.

This brings me to a new point: Market trends.

The last 3 years have seen some clear shifts in consumer focus - gamers are getting older on average, and want mature-themed games. This was rightly pointed out in the Editorial, and I completely agree. But, as sales show, people also prefer a little flexibility in their systems. Hence, DVD and broadband functions are serious sales points. Nintendo probably should examine this generations' market trends, and, instead of bucking them, go with the mainstream.

The 'third party developer' issue is always a hotly debated issue. To say that

...third-party games rarely move hardware units, and it’s nearly impossible to predict any impact a single third-party title might have on sales of other games...
is entirely incorrect.

There are certain third party properties that are guaranteed sales - these are winning titles and series with a strong fan base and generally a certain amount of heritage that comes with the developer. The past has proven these games to be winners. Squaresoft/Enix's RPGs, Capcom's survival-horror games and 2D fighters, Namco's fighters, EA's 'Sim...' games, Konami's Castlevania and Metal Gear games, UbiSoft's tactical shooters, the list goes on and on. These companies consistently have top-selling titles.

Can it seriously be said that Nintendo can afford not to throw a little 'goodwill' towards these companies? Again, market trends speak louder than any amount of speculation. Third party games DO sell systems. Absolutely.

Lets move onto Internet fan sites.


Finally, Nintendo needs to leverage the Internet much more than it has been, and not just for online gaming. The Internet is a great advertising medium, especially after the latest Internet advertising crash. It’s much cheaper than just about any other medium now. More than that, Nintendo needs to use websites like this one more to their advantage.

Fair enough, the 'net is a cheap place to propagate some publicity. However, Nintendo have their own Internet gurus to create flashy adverti-sites. Think Animal Crossing, Zelda, Metroid, Mario and Smash Bros. The argument that is posed is reasonable enough, but think about the situation rationally.

Fan sites are generally created by fans (except for the 'big-business' examples pointed out in the editorial). If Nintendo suddenly decide to lend a helping hand (ala, giving the Webmasters free consoles, all-expenses-paid tours of NOA, a shiny, new computer etc.), there could be serious repercussions. Any generosity on the part of Nintendo could be considered 'cash-for-comments'-style bribery. And it wouldn't be the website that looks bad in the eyes of the media, that's for sure. I'm not saying that Nintendo shouldn't recognize, or even have regular correspondence with websites, but what more can you reasonably ask for? A fan site is still a fan site, not a NOA internally created site.

A few final issues to ponder.

There is one major point that wasn't really touched upon, I felt, and that is the PAL marketplace and it's effects on Nintendo's sales.

Europe and the Asia-Pacific region are big markets. Unfortunately, they are also neglected. Poor sales have dampened Nintendo in the eyes of the Australian marketplace, and European sales are now flagging behind MS. I'm not going to offer a definite solution, but here's the problem, anyway.

Localization. ...Of games, of systems, of hardware-specific requirements.

Without going into too much detail, Nintendo are notorious for how long their games take to be translated and adjusted for a PAL release. This is fact, not opinion. It just takes far too long for a title to hit the shelves in a PAL nation. 6-8 months is a ridiculously long time, no matter how good the title. And it can't be blamed on text translation, either. Third party titles generally launch 3 months or less, post-NTSC release. Clearly, if they can do it, so can Nintendo. They really, really need to look at their foreign release system. A lack of timely games is strangling the Gamecube in these regions.

Whilst not directly related, Nintendo continue to hold a policy of strict secrecy, for both games and hardware. They cannot continue to fall back on the notion that Sony MS, and game developers are out to steal their ideas. This must change. If a major move is to be made in the marketplace, then steady hype and product information is vital.

How can a consumer make an educated buying decision, if they don't have the information? Why should we be forced into scouring fan sites for teensy trickles of information and speculation? Fact is, we shouldn't. Moreover, the average consumerwouldn't.

In the end, no-one can shift Nintendo's plans for the future of gaming, but the men and women at NOJ and NOA. Regardless of their position in the market, there will still be loyal fans, dissenting ex-fans, and the average joe-consumer to mix things up, sales wise. We can hope that Editorials such as these have some impact, how ever minor, but in the end, it's Nintendo. ('Nintendo' translated, means 'In God's hands'.)

Thanks to Rick for fuelling my desire-- no, need to write this stuff down.  

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