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Analysts Recommend Nintendo Turn Third-Party

by Steven Rodriguez - February 25, 2003, 11:40 am EST
Total comments: 51 Source: Press Release

The numbers never lie. Also, analysts recommend that pigs should fly in the very near future.

Strategy Analytics: Nintendo Likely to Lose GameCube Gamble

Microsoft's XBox Will Gain Ground In This Year's 36 Million Unit Console Market

LONDON--(BUSINESS WIRE)--Feb. 25, 2003--The number of users of advanced games consoles soared by 128 percent in 2002, reaching 56.3 million worldwide, according to the latest research from Strategy Analytics' Broadband Entertainment Strategies service. 75 percent of users own Sony's PlayStation 2, compared to 13 percent with Nintendo's GameCube, and 12 percent with Microsoft's XBox. Forecasts suggest GameCube will lose ground during 2003. According to the analysts, Nintendo could build a leading position in the $12 billion software market, but it must first abandon its present console strategy.

Global sales of advanced 128-bit consoles reached 32.9 million units in 2002, according to the research. PS2 was the choice of nearly 70 percent of buyers, while the remainder was split evenly between GameCube and XBox. Total sales of all platforms in 2003 are predicted to reach 36.2 million units, but GameCube's sales are expected to fall by 4 percent in 2003, while XBox sales will rise by 12 percent. Key drivers of this trend are XBox's growing software library, its clearly defined online gaming strategy, and Microsoft's substantial investments in the platform. By contrast, the GameCube's online strategy is unclear, and its support from publishers appears to waning.

Strategy Analytics recommends that Nintendo abandon its traditional console-exclusive software publishing strategy and publishes its games across multiple platforms. The company stands to lose relatively little, while gaining access to an additional 77 million console owners during 2003.

"Nintendo is missing out on the current generation of games players," says David Mercer, VP of the Strategy Analytics Global Broadband Practice. "Culturally it will be difficult for the company to change course, but it must do so in order to secure its long-term position as a leading games publisher."

Talkback

RickPowersRick Powers, Staff AlumnusFebruary 25, 2003

Before this is taken the wrong, way, I'm going to echo my comments from the news story on PGC.

No mention of the fact that Nintendo makes a great deal of money through the licensing fees to make games on it's console either, something it would lose out on by leaving that market.

Most importantly, this article focused solely on SALES, not profitablity, where Nintendo leads. It also ignored Nintendo's stranglehold on the handheld market.

There is a lesson to be learned here. If these analysts knew all the answers to these questions, why aren't they running multi-million dollar successful companies? Because those that can, DO. Those that can't, play armchair quarterback.

On a side note, it's also worth noting that this report came from Europe, where Nintendo is having a particularly hard time, so of course, the sentiment from that part of the world is going to be more "doom and gloom" than is accurate for the rest of the world.

Ian SaneFebruary 25, 2003

Okay so a news item about how Nintendo is making more money than anyone was just posted on the site and analysts are recommending that Nintendo go third party. Does anyone else think that doesn't make much sense? If Nintendo is making good money with what they're doing why change it? Sega went third party because they were in a money pit. That's not the case with Nintendo.

Plus ignoring the GBA makes this whole "analysis" completely useless because it doesn't represent reality. If Nintendo only relied on the Gamecube then they would be in trouble but they don't so the situation is completely different.

"GameCube's sales are expected to fall by 4 percent in 2003, while XBox sales will rise by 12 percent."

What is this based on? What hot selling title is coming to Xbox to make it's sales rise so much? The problem with these analysts is that they don't know anything about games. A major title (Final Fantasy VII, Sonic the Hedgehog, Donkey Kong Country) can change console sales considerably. If sales trends were all that made a difference then surely the N64 would have been top dog because it's sales were huge during it's first year.

SeanFebruary 25, 2003

The old adage "Everyone's a critic," seems to have just been changed to "Everyone's an analyst."

HisaoFebruary 25, 2003

Quote

Originally posted by: RickPowers
Before this is taken the wrong, way, I'm going to echo my comments from the news story on PGC.

There is a lesson to be learned here. If these analysts knew all the answers to these questions, why aren't they running multi-million dollar successful companies? Because those that can, DO. Those that can't, play armchair quarterback.

q]

O so true.

Fammy2000February 25, 2003

How long have people forecasted doom for Nintendo? Since the SNES days. Nintendo made it through that. The N64 days? No way would they make it with a cartridge format. They outlasted the Dreamcast. Gamecube? XBox is going to claim second and send the GC packing. We'll see but unlikely. History would have to say that Nintendo's going to make it. Being profitable isn't a new secret business concept.

I could also add that the Lynx/Game Gear spelled doom for the Black and White Game Boy (I loved that thing!).

Is there anyone that believes this forcast?

z0gsterFebruary 25, 2003

Does anyone else think it's ironic that they said "The number of users of advanced games consoles soared by 128 percent", when the advanced games consoles all have 128-bit graphics? Just pointing that out, I thought it was pretty funny.

ByronFebruary 25, 2003

Hmmmm your article says that the GC has 13% of the market while XBox only has 12%. I guess the GC is still in 2nd place worldwide.

Ian SaneFebruary 25, 2003

"Does anyone else think it's ironic that they said 'The number of users of advanced games consoles soared by 128 percent', when the advanced games consoles all have 128-bit graphics?"

Considering that's not irony no I don't. face-icon-small-smile.gif

GaimeGuyFebruary 25, 2003

And now we will hear idiots screaming even LOUDER "NINTENDO SI GIONG THRID PARTEY!!!111oneoneone" :/ Oi... Has profit become irrelevant in the eye of "analysts" or something? face-icon-small-tongue.gif

GregHeadFebruary 25, 2003

IMO these analysts don't recognize a "niche" when they see one. "If you're not selling the most crap, join another company". XBox is a fine console, but N is making Way more money than M$, so this report is a waste of webspace face-icon-small-tongue.gif I'm not defending Nintendo, I'm just speaking the truth.

Perfect CellFebruary 25, 2003

It might be half trues or lies or Microsoft sponsored crap, but the problem with articles like this is that it HURTS Nintendos image, Nintendo doesnt need to have companies calling it to leave the console wars, people will way, oh look Nintendo will go the way of Sega, why should i spend my hard earned money on a Gamecube now? Bad Press is Not good in the Videogame console wars, Nintendo needs to fight back with their own sponsored propaganda to fight back this crap cause im sick of it! I want Nintendo to stay in the console buisness!

ThePermFebruary 25, 2003

do you know how easy it is for people to have their opinions changed....hella easy. see wrestling. People are loved one minute..hated the next.

mouse_clickerFebruary 25, 2003

It pisses me off every time someone uses the "Nintendo makes more money" ploy when they realize Nintendo's sales are dying. You wanna know WHY Nintendo makes more money in videogames than any other company? It has nothing to do with "family values" or lack thereof- it's the GAMEBOY! The Gameboy, now with the Wonderswan being dropped by Bandai, has almost literally NO competition. The GBA is the fastest selling console in history and I believe it's matched the PS2 although being out for a year less. Just about *everybody* has a Gameboy of some sort, whether it's the original, Color, or Advance. Developers would have to be crazy to ignore this GIGANTIC user base, so they develop a ton of games. Most of them suck, but Nintendo gets licensing fees on every single one. THAT'S how they make all their money. I bet Nintendo's profits from the Gamecube are a joke when compared to the profit from the GB/A. I'd also bet Sony makes a LOT more off of the PS2 than Nintendo's making off of the Gamecube, and soon MS will be making more off the XBox or it's predecessor. Get it through your thick skulls, people, that Nintendo's money does NOT come from the Gamecube. Just because they get a bunch of money off of the GBA doesn't mean they're gonna pour all that money back into a console that's making very little profit. If Nintendo intends to keep it's home console *alive*, it had better learn that 3rd-parties are what matters. Nintendo can continue making their top-notch 1st and 2nd party games, but they need to hunt down 3rd-aprties as if their success depended on it. If you look at any very popular home console, there's one major trend- IMMENSE numbers of 3rd parties. This holds true for the Atari, the NES, the SNES, the Genesis, the PSX, and now the PS2. All had incredible 3rd-party support. In comparison, the Saturn and N64, for example, did rather poorly and had very little 3rd-parties (and don't try to tell me Nintendo made more money in the N64 era than Sony- nearly all of that was from the GBC). Nintendo needs to diligently grab 3rd parties, preferrably 3rd parties with VERY big selling franchises. That's not to say Nintendo needs to drop their mantra of quality, they just shoudln't elt that mantra interfere with getting 3rd-parties (because licensing is really where all the money is made). Luckily they're attracting some big name Japanese 3rd parties (Namco, Sega, Capcom), but they need more western developers (Rockstar, EA, etc). I've heard rumors Nintendo has some sort of deal with EA, but I don't nkow how much truth there is to it.

Oh, and in terms of sales, I believe Nintendo's 3rd everywhere except for Japan, in both consoles and software. I could be wrong though.

"There is a lesson to be learned here. If these analysts knew all the answers to these questions, why aren't they running multi-million dollar successful companies? Because those that can, DO. Those that can't, play armchair quarterback."

And if you're so sure they're WRONG, Rick, why aren't you running your OWN multi-billion dollar company? To know that they're wrong, you must know what's RIGHT, and yet you work for a *free* Nintendo fansite, Rick, while blindly defending a business that is obviously fumbling in the home console market. I'm not saying Nintendo's doing *bad*, but they could be doing so much better. At the momemnt, Nintendo's an underachiever if I've ever seen one. While I do think that it's not our place as gamers to really worry about sales statistics and of the such, I also don't think we should be *denying* that in terms of home consoles, Nintendo has been digging itself into a hole with grossly incompetent marketing and business recently, and have only recently started climbing back out.

RickPowersRick Powers, Staff AlumnusFebruary 25, 2003

Cross posting is against the rules, mouse_clicker ... you know that. And to repeat what I told you in the other Talkback thread, this arguement keeps coming up because it's TRUE. Nintendo makes more money on GameCube than Sony does on the PS2, period.

And I'm not blindly defending anyone. There's nothing blind about it. I'm one of the few people you see writing about Nintendo and videogames that's been involved in all aspects of the business, and I understand it better than most. I can speak from a position of authority because I KNOW. The point of posting this article at all was to illustrate that "analysts" are usually making their assumptions and recommendations based on partial, and sometimes completely untrue information. I know Nintendo's business better than any fansite, better than most "professional" sites, and better than most analysts.

The problem here is that some of these analysts got their jobs covering the "internet tech boom", where sales were more important than anything. Most of them haven't shaken that mentality and gotten back to the basics. Sales are not the end all, be all of a sucessful business, as all of the failed "dot coms" will tell you.

Most importantly, they all forget a MAJOR facet of the business. Nintendo has ONE core competency ... GAMES. Sony and Microsoft can afford to take losses to compete because they have other businesses they can fall back on. Windows and Office subsidize everything at Microsoft. Likewise with Sony, they have other areas that can help out.

Fact is, the numbers don't lie. Only counting HOME CONSOLE SALES, not handheld, Nintendo made half as much on sales, but still made more money than Sony. Argue that point all you want, but it's there in black and white. Sony is outselling Nintendo six-to-one, and still can't beat Nintendo on profitability. Say anything you want, but Nintendo is doing something RIGHT.

AzuleFebruary 25, 2003

How does this profitability benefit shareholders? can you tell me if this is only going to Nintendo's pocket?

RickPowersRick Powers, Staff AlumnusFebruary 25, 2003

The only place profitablility ever benefits a stock holder DIRECTLY is if the company issues dividends. I don't beleive Nintendo does. However, a profitable company is attractive to stock holders, and that alone makes the stock price rise, which does benefit the stock holders.

Perfect CellFebruary 25, 2003

Sorry Rick but i disagree. Nintendo isnt doing something right. If they were Nintendo would be Number 1 or at least number 2 in USA/Europe alongside Japan. The fact is Nintendo is having problems. Why have we seen the string of third parties jumping ship? Why do we constantly see third parties release their games first or only on the other two consoles? The fact is todays gamer i not the gamer of SNES days. I remember the SNES days, Nintendo would get everything first on its console. Capcom released their best versions of its games on the SNES, Konami was a strong supporter, and it was arguably the best console for RPGS in a loong time. But the SNES is gone. The president of Sony said this generation isnt the NES generation its the Playstation generation, and by golly hes right. Sony is "pop" right now. Nintendo isnt. Steve Kent whose a RESPECTED analyst not these other analysts in this two bit BUSINESS WIRE magazine, said Nintendo is stuck in a hard place, Too Kiddy for the Adults but not Adult for the Kiddies. Its a damn shame. Nintendo WILL have to adapt its self to the new gamers to be able to survive, and by Miyamotos last interview it seems they are reluctant to do this. They also need to give out money for bettter third party support. You need to spend money to make money, finally they need new marketting and propaganda, also an adult Nintendo official magazine with demo disks could help

BloodworthDaniel Bloodworth, Staff AlumnusFebruary 25, 2003

Well, he said they were doing something right, not everything right. It's true that Nintendo is not marketing as well as they could be and that they don't have the largest percent of the market, but the whole point we're trying to get across is that it doesn't really matter. If they're still more profitable than Sony and they continue to make great games, then there's no reason to cater to the masses.

People saying that Miyamoto needs to make different styles of games are just not thinking straight. Miyamoto didn't get the status he has today by making games that copied other designers or fit perceived market wants, he is a creator and he has the freedom to create pretty much whatever he wants. If you pushed him to fit a certain mold, chances are that he'd lose some of his passion and produce less than his potential.

MikeHruseckyMike Hrusecky, Staff AlumnusFebruary 25, 2003

So... it's "right" to be in whatever market position is subjectively acceptable in terms of console penetration, even at the expense of profit? Nintendo's goals might not be what YOU want them to be, but how can anyone argue with black ink success? What makes Nintendo's goal of profitability wrong, and Sony's goal of penetration right?

RickPowersRick Powers, Staff AlumnusFebruary 25, 2003

EXACTLY, Mike. Thank you.

Perfect CellFebruary 25, 2003

When the Gamecube launched Tech TV did say that because of eliminating DVD playback, and smaller less expensive parts, they would make more money by the console. They made the comparison to selling Razors and Razor blades, normally a Company doesnt make money on the Razor(Console) they make money on the Razor Blades ( Liscensing fees to games) but they said the gamecube would be different since they were also making money with the Razor/Console.

That doesnt excuse nintendo for not changing. They need to evolve and adapt to the new gamer. Hardcore gamers who really like Mario and Metroid are a dieing breed. The new gamer is the maintream gamer, they buy games like DBZ Budokai, and Ty the Tasmanian Tiger.

Im not so sure the Gamecube is more profitable than the PS2, the PS2 has sold so many consoles, if im not mistaken its in the 40-50 million mark that they are making money now. The Xbox is selling at a loss though.


I never said Miyamoto should sell out and make a new Japanese GTA, God knows im a huge Miaymoto fan now, I thought Pikmin was a work of genius. But Miyamoto=Nintendo, what Miyamoto belives is probably what Nintendo belives. Nintendo needs to realize that they can add more violent games yet still make Mario.

MikeHruseckyMike Hrusecky, Staff AlumnusFebruary 25, 2003

If you're unsure of profitability, see the other news article on the site, and it's corresponding thread. Nintendo is the most profitable, hands down.

RickPowersRick Powers, Staff AlumnusFebruary 25, 2003

That's the problem with the Internet. People sound off without having all the information, even when the information is there to be had. It's fine to want Nintendo to be number one in sales. That's great. It's not like they aren't making money doing what they're doing, and they're pocketing more of it than anyone. I fail to see the problem? It may not make them the darlings of the media like Sony or Microsoft, but you can't argue with a bank balance.

Perfect CellFebruary 25, 2003

Must be im some ignorant net user then.... Thats ok, then tell me why did both McDougal and Iwata have to talk about how they are not leaving the console buisness. If things were trully "all right" they wouldnt have to awnser these questions.

Grey NinjaFebruary 25, 2003

Sorry, I haven't really followed this thread too much, as I am sure that there are things being said in here that I violently disagree with, and I am not in the mood to have an in depth discussion of the subject right now. Maybe after a while.

Anyways, commenting on the article itself, I found it quite interesting that they praised Xbox for having such a great online strategy, while they implied Nintendo was doomed because they had no real online plans. They never thought to consider that maybe Nintendo has a better sense of what gamers want than they do.

Here is a poll on GameFAQs about how many gamers can't live without online games. Almost 46000 people voted. Also keep in mind that every one of these people has internet access of some sort.
http://cgi.gamefaqs.com/poll/index.asp?poll=1170

Is online gaming really a sure thing at this point in time? Maybe. You tell me.

RickPowersRick Powers, Staff AlumnusFebruary 25, 2003

Ninja,

Or as Justin says in his comments on the site itself, maybe it's because the people that wrote the report are BROADBAND ANALYSTS.

Anyway, I just find it very interesting that those of you that are taking Nintendo to task in THIS thread, proclaiming doom and gloom for Nintendo (which we only posted due to the preposterousness of it, I might add), are completely ignoring this one where the numbers to back up our site are clearly posted. face-icon-small-smile.gif

bonestormerFebruary 25, 2003

I know I'm in the minority here, but I for one wouldn't mind at all if Nintendo went 3rd party (or 2nd). No one doubts they are very profitable now, but with even Nintendo admitting that sales haven't met expectations, can they keep being profitable using the same business model as in the past? I'd say that's a big question mark in the ever changing market.

But even if they can be, is it worth it? The article doesn't say Nintendo is in danger of going bankrupt. I don't think any fool would suggest that. But just maybe if they did go 3rd party, they could make even more money then they are now! More money that could then be reinvested to bring us better and better games. And with N not having to worry about hardware, they would have more resources to spend on software.

No matter how good N's software is, I personally feel that PS2 and Xbox have better marketing, image, hardware, and other non-software related areas. So IMO if N would go 3rd party or hook up with one of these, it would be better for all.

Saddly I don't think N is going 3rd party any time soon. Just as a big fan of Nintendo, I almost wish they would.

StarBlueFebruary 25, 2003

Hey All,

I have been around since the Atari 2600 and along the way there are a lot of console manufacturers that don't exist anymore. I am sure we all know many of them, SEGA is by far the most recent and most dramatic. Nintendo has a lot of loyal fans out there that fight to keep Nintendo from joining the ranks of Coleco, Atari, and SEGA; it is too painful for a lot of us to contemplate. However, I watched these companies sink and there is something that I see with Nintendo that I did not see with the others. Atari, SEGA, Coleco had massive debt and there was no way for them to dig out of it. SEGA realized this and decided at the last moment to jump ship and become a third party. Also I feel with SEGA is that they still make management mistakes that still to this day cause SEGA not to be around in 5 years(ie taking on EA in sports titles), their debt is better but only barely. Nintendo makes mistakes too, I feel that Nintendo of America does not do a good job of telling NCL WHAT IS WRONG!!! Is this from all of the talent that left NOA?? I don't know but I am a professional IT engineer and I know how Microsoft works. If any of you have been to Redmond, you know that NOA and Microsoft are about two blocks away from one another. Microsoft has a lot of money to throw around and they do it without regard to who gets in the way. They know that money has a lot of influence, in getting consumers as well as talent to run the business. Sony is the same way, this is why those two corporations are some of the largest in the World as well as very successful. I am not afraid that Nintendo will leave the console market, I am more afraid that I might have to learn Japanese so that I can import and play all of the Miyamoto masterpeices if Nintendo dumps the American and European markets. Nintendo knows that to survive they have to make a profit, right now that is Japan; Gameboy has no real competition so it makes money eveywhere.
Sony and Microsoft have a lot of public relations groups, I would not be surprised this analysis was sponsered by Microsoft in some way. The PR groups have ONE goal in mind, discredit each other and Nintendo and they do this by causing image problems just like this report. Image is a major problem, but if I knew the answer for Nintendo I would be one of those rich CEOs. Yes it hurts to see the company that gave us so many great games, but it does no good to dis other systems; it just helps to destroy Nintendo. I have read about this report on many sites today, and I have noticed that many PS2 / Xbox fanboys out there complain of how kiddie the system is. But why when someone mentions the possibility of Super Mario Sunshine being played on a Sony / Microsoft console they all think it would be awsome and can't wait until it happens?!?! Nintendo makes great games, it has work to do on image but as long as Nintendo is wanting and able to make wonderful games that I want to play, I will buy them. When they release the next generation console, I will buy it!! I will also tell my friends what makes Nintendo great, and show them the games that the other two consoles only wished they could play. Sorry for an old Atari Fanboy getting on his soap box. face-icon-small-wink.gif

StarBlue

mouse_clickerFebruary 25, 2003

Rick: Sorry about cross-posting, The two threads are very similar and I thought one argument would work for another. Besides, like I said, for some reason we can't edit our posts in this particular forum.

But is Nintendo REALLY more profitable with the Gamecube than Sony is with the PS2? I find that really hard to believe. I know *Nintendo's* more profitable, but that includes GBA income 99.9% of the time. But the fact is Sony's sold more PS2's than Nintendo could ever dream of sellnig Gamecubes, they have 3rd-parties coming out of every spot imaginable, and Sony's blasting into the 1st and 2nd party sector very quickly. Nintendo, on the other hand, has sold very few Gamecube's in comparison, has MUCH less 3rd-party support (with similar licensing fees to Sony, I think), and several of their 1st and 2nd party games haven't sold too well. Really the only advantage Nintendo has right now is their really BIG franchises (Mario, Zelda, Metroid, SSB, etc). Is Nintendo REALLY more profitable on the Gamecube than Sony is on the PS2? Because if it's true, shown with evidence, I'll drop my case entirely. I still think Nintendo could shape themsleves up (even if they ARE grossing more than Sony with the Gamecube, think how much MORE they could be grossing if they were in Sony's position with sales), but I'll drop my case I've presented in both threads.

ruby_onixFebruary 25, 2003

Quote

Is Nintendo REALLY more profitable on the Gamecube than Sony is on the PS2? Because if it's true, shown with evidence, I'll drop my case entirely.


It's a safe bet that Rick's (most recent) info source would be the 600 page report mentioned in the other thread. But, considering our latest push to follow proper copyright laws, and that you apparently have to buy the report for $3000, I wouldn't hold your breath for Rick giving us any nice scans it. Or even precise numbers, for that matter. face-icon-small-tongue.gif

Are there any particularly interesting numbers (or approximates) you can toss out, Rick?

Uncle Rich AiAiFebruary 26, 2003

i have a question...doesn't nintendo have $7 billion in the bank? i can't see the logic of nintendo going third party, even if they were making a loss...

visualwarpFebruary 26, 2003

Great post from StarBlue. Smart guy without a doubt.

I realize most of us in here are already fans of Nintendo and will defend it to the end but that doesnt mean you don't worry about the stability of the brand at times. There is a lot of heat on Nintendo right now.

So in light of some of hte arguments I feel it is necessary to bring out a few points.
1) Microsoft is losing millions on Xbox right now and have been working on strategies to turn this around. Namely, releasing a new version of the hardware that will hopefully make people want to buy it for a change, and possibly pay nearly as much as it costs to manufacture it. Nice plan! However they need to get out of the RED before they are any kind of threat to the GC. First things first. They are in no kind of position to take out the big N in the console wars. As was stated repeatedly, Nintendo designed a brilliant console with the GC that is user friendly, powerful, and inexpensive to manufacture. Any reason to mothball this design? NO! And not in the forseeable future either. MS has to eat from the scraps that fall from Nintendo's table. (HINT: Rare)

2) The Xbox was obvioiusly designed by the same kind of people writing this report. People who don't appreciate the true meaning of game consoles. Small, simple, colorful, and with tons of great EXCLUSIVE games. The Xbox is none of these. It is a PC in a smaller box with a more poorly designed conroller than even my Microsoft Sidewinder GamePad I have had connected to my PC for the past 5 years. If you want to win in the console market you should first know what the heck its all about.

So why would the Xbox beat Nintendo? Better hardware? Depends on how you define better. The PS2 is the oldest of the bunch and no one even pretends to be a threat to Sony right now. So apparently having more powerful hardware is not enough. As far as DVD playback, yes its a great bonus and I still use my PS2 for my primary DVD player (yeah you heard me, Adam face-icon-small-wink.gif but DVD players are so cheap now who really cares. And that $90 player from Radio Shack comes with a remote... bundled for FREE? WOW!

But I digress, the bottom line is oodles of gamers love Nintendo, and we have kept them very profitable over the years. If N can survive the N64's stink cloud against the likes of the PSX, then they have nothing to worry about now. The CG is 100 times as fine a console as the N64 ever was and is gaining much more respect than the 64 had. The Xbox is not even targeted at the niche that kept the '64 alive for so many years, and that audience is just now graduating to the 'Cube.

My personal observations when I go to Best Buy is about 8 people in the GC aisle, about 10 buzzing around the PS2 games, and a nice tumbleweed rolling by the Xbox stuff way on the other side. It's the same the 3 locations I've been to here in Houston. Theres my freakin market observation. I had plans to pick up an Xbox over a year ago but as of yet they havent given me a reason to. I guess thats because having the box with the highest clock speed doesnt make be all giddy with joy. Oh yeah, maybe thats because I already have a PC? Speaking of which, therein lies my ONLINE STRATEGY. I dont need any more network cable running all over my apartment.

BTW I am also an IT professional and I know people who work at MS. I have nothing against MS at all, I use their products almost exclusively. I just have to be honest and say I don't see any real skill in winning the console market with them. Most of the other guys I work with in this field are fans of the GC as well. Go figure, market guys.

Just my $0.02.

Super MekmanFebruary 26, 2003

By StarBlue:
"I would not be surprised this analysis was sponsered by Microsoft in some way."

I agree with you. It's all advertising in some way. It's just more of MS tossing around cash.

Buying Penny-Arcade, and perfect review scores for Halo.

It's just more of the same.

StarBlueFebruary 26, 2003

I have a few more comments after I read a few to mine. I agree with visualwarp in that Rare so far has done NOTHING for Xbox, instead there are a ton of Xbox owners out there yet to have a Rare game to play with. If I remember right Kameo was suppose to hit the streets this spring, it so far has disappeared of the radar and nobody knows when it is coming out; I now hear possible October release. Oh it is funny to see all of these Xbox fanboys saying "Yeah we got Rare and Xbox rules" but in the mean time Rare is behind schedule and yet to deliver ONE TITLE; brings back a lot of memories. I am so happy that Retro delivered Metroid Prime right at the start of the holidays, also if anyone has not played Eternal Darkness please do!!! because Silicon Knights made a great game. Too bad it got released about the same time as Resident Evil because to many non PGC sites put them in the same catagory. Also I do find it interesting that Xbox is going through a revision???, that has to be costing Microsoft a lot of cash to retool its factories, the cost of redesigning, besides the fact it is going to upset a lot of current Xbox owners. Ok with Nintendo we have a couple of redesigns in our history(SNES after N64 released, also I am not sure but I think NES did after 6 years on the market?), but not 18 months after release. By the way, Microsoft is not just loosing Millions, it is Billions and Billions to paraphrase Carl Sagan. At last count the Xbox division has lost over 2 Billion, they expect to loose 5 Billion before Microsoft says they will re-evaluate its Xbox strategy(Meaning pulling the plug). There are a lot of people out on news groups that talk that they want to pick up a second system, I tell them about the games Nintendo has(In the least Fanboy tone I can) and many of them go out look and come back and say they did not know Nintendo had some great titles and more on the way. The reason I say "Least Fanboy tone" is that Nintendo Fanboys have a bad rap as being loud and obnoxious, I am trying to show that a Fanboy can be intelligent and break the sterotype.

SjaleshoFebruary 26, 2003

Quote

Originally posted by: Perfect Cell
It might be half trues or lies or Microsoft sponsored crap, but the problem with articles like this is that it HURTS Nintendos image, Nintendo doesnt need to have companies calling it to leave the console wars, people will way, oh look Nintendo will go the way of Sega, why should i spend my hard earned money on a Gamecube now? Bad Press is Not good in the Videogame console wars, Nintendo needs to fight back with their own sponsored propaganda to fight back this crap cause im sick of it! I want Nintendo to stay in the console buisness!


I only registered to say that I totally agree with this post! Nintendo should release a counter-attack on all that "slander". Nintendo's PR should be more than announcing games and events. Manage the media!

Also in response to those analysts: http://www.dfcint.com/game_article/feb03article.html

)Dark-LInk(February 26, 2003

visual warp ur in HOUSTON? SWEET im here to a DAMMN THE cold right now! AAAHH im freezing in here.=(

yes AIAI THE BIG N does got alot of cash heres the CONFIRMATION

http://www.theinquirer.net/?article=7974

i think i poested it earlier but o well there u read that they got 7 BILLION in the bank.....(=) I HOPE THEY BUY OUT CAPCOM WITH IT!!!)

visualwarpFebruary 26, 2003

StarBlue, I knew MS was losing a lot of money but I didn't know the tally was that high. Maybe by the time I post this message they will have lost another mil? Ouch! Yeah that’s what you get when you manufacture the most expensive machine, sell it for much less than it costs, and then fail to deliver enough worthwhile games to make it back. They are showing how inexperienced they are in this market.

I also have to point out a few times I have seen MS sponsored propaganda, usually on MSN.com which shouldn’t surprise anyone, but what was shocking was when one of my buddies sent me a message after he installed MediaPlayer 9 and said "Did you know Metroid Prime was also on Xbox?" After laughing for 5 minutes I found out that the "Media Guide" page had several images and some blabs about how great Metroid was, and sure enough it was listed under the Xbox games! I guess if you don’t have a decent title of your own you can try to claim someone else’s. This may have been an honest mistake, but I still couldn’t believe they made that mistake at all. So maybe it’s not much more of a stretch that they would do it to confuse customers and make them think an Xbox version was in the works, maybe get a few more sales, and then claim it was a typo to save face. It sounds paranoid but who knows what they would try after losing so much money, or some employee who had lots of stock in Xbox... now that may not be implausible.

Either way, you still can't deny the influence that Microsoft has on the technology sector. I'm not surprised to see biased articles popping up all over the place. I am surprised that the Xbox is doing as poorly as it is with them behind it. Microsoft does know how to market a product and fill a niche when it sees one. It also knows how to stamp out competition just by flooding the market with their brand and propaganda. Early in the Xbox's life span, I noticed all the rental places putting Xbox racks out front and pushing the GC stuff way back. But that of course only lasted as long as it took for people to find the hidden GC games and resume renting them in quantity. Whatever MS was paying Hollywood and Blockbuster to make that move apparently ended up not being enough. PS2 is back to the dominant position on the racks and GC is right back with the Xbox stuff in front. I saw the same thing at Toys R Us. This may be because the managers would rather make money by offering what customers want than some payoff for product positioning on the floor.

I really expected a lot more effort from MS on this console in the games department and not just pushing an empty product because it is supposedly more cool. I'm disappointed in MS. For shame. I was at the store on the launch days and it was a toss up between the Xbox and the GC. The bottom line was three words: Mario, Zelda, Metroid. I have no regrets. The only reason I would sell my GC now is to get a platinum one.

Having said that I never did rule out picking up an Xbox. I'm just still waiting for a reason to.

Yeah Dark-Link, its cold and damp and there seems to be no escaping it. These houses are not built for this kind of weather and everyone is coughing and sneezing. Can't wait till that sun comes back out and bakes the bacteria right out of our sinuses with its purifying x-rays and other deadly radiations. I have two boxes of Motrin sinus on my desk right now, a 40 pill and a 20 pill backup supply. I pop them like M&M's and that can't be good...

Perfect CellFebruary 26, 2003

Interesting its not the first time these "hacks" have spurned the GCN


From December 11, 2002 from David Mercer, Vice President, Broadband Practice at Strategy Analytics

Quote

This report determines that the games console market is entering a critical three-month period which could determine success or failure for both GameCube and XBox. Several factors lead to the conclusion that Nintendo will probably exit the console market since the survival threshold for any game platform is now in the region of 15-20 million systems deployed. This continues to rise as games development costs increase. Furthermore, in spite of Xbox's slow start, Microsoft will continue to commit the funds necessary to evolve their Xbox platform into a full-fledged broadband home entertainment system.


Again, its too fishy that a person working in a broadband company would be in favor of the Xbox.

Heres this dudes email I don't think so.

Grey NinjaFebruary 26, 2003

Visualwarp, your posts are the best reading I have seen in months. Thank you for being here. This site is a better place because of your presence.

Marcus ArilliusFebruary 26, 2003

Quote

Originally posted by: Bloodworth
Well, he said they were doing something right, not everything right. It's true that Nintendo is not marketing as well as they could be and that they don't have the largest percent of the market, but the whole point we're trying to get across is that it doesn't really matter. If they're still more profitable than Sony and they continue to make great games, then there's no reason to cater to the masses.

People saying that Miyamoto needs to make different styles of games are just not thinking straight. Miyamoto didn't get the status he has today by making games that copied other designers or fit perceived market wants, he is a creator and he has the freedom to create pretty much whatever he wants. If you pushed him to fit a certain mold, chances are that he'd lose some of his passion and produce less than his potential.


Its very true Nintendo wasn't marketing right but I think times are changing now (Thank God!) I have seen more commercials for Zelda and Gamecube in the past Month than I've seen in all previous months since before the Gamecube's release combined. On top of that, they are actually targeting an older audience. I've seen lots of commercials on Comedy Central during shows like "Chapelles Show" and "South Park" and during "American Idol" (very smart move). As well as other shows that have an older audience.

On another note, I completely agree with Rick here. Nintendo IS doing something right. Being in business isn't always about how much you sell, its about how much you profit. Its not that hard to grasp. Of course Nitendo could make more money if they sold more systems but they make more than enough with what they've sold. When Nintendo sees their bank statement every month I think they could care less about console sales. However, when the game division at Microsoft looks at their bank statement, they probaly cry. Also, you have to realize, nintendo has still sold a lot of consoles, those other companies have just sold more.

NicodemusFebruary 27, 2003

Before I say anything I first must say that I own both a Gamecube and a GBA, cause I can tell by the other posts that you guys aren't going to like what I have to say.

Last year at this time when market analysts said that in 2002 the Xbox would overtake the Gamecube, all the fanboys in here called bull**** and said things like "what do they know about gaming! wait till mario and starfox and bla bla bla bla."

One year later.. look where we are? Apparently these guys know more about the industry than any of you.

To those of you who keep bringing up GBA.. I know that it's Nintendo's ace up their sleeve.. but how long will it be there for them?

I have a GBA, and guess what? It sucks balls.. you know why? Because Nintendo has no competition so they basicly ignore it, knowing that it's the public's only option. All we get from N is a bunch of f*cking SNES ports of games I beat ten years ago. And then to top it off, they're selling each Mario game separately instead of releasing Mario All-Stars.

That's all fine and dandy for now.. but do you think Sony and Microsoft are just going to stand by and let Nintendo rule the handheld market forever? I guarantee you, they're going to attack it.. and if Sony does the smart thing and names it something like "Playstation Mobile (PSM)" or "Playstation Go (PSG)" or "Playstation 2.5 (PS2.5)".. the name recognition alone will crush Nintendo.

Think about it.. did all the apes that went wild over the release of the PS2 buy it because of all the killer games that were available at launch? No, because you and I know Sony had dick for games on the PS2 at launch.. folks bought it because it was the new Playstation.. and that can and will carry over into the handheld market.

The minute Sony releases a handheld, I'm going to take my GBA and chuck it into the toilet, and I won't be suprised if it flushes itself. Nintendo is burning it's last bridge with the way they're handling the GBA.

visualwarpFebruary 27, 2003

Yeah, look where we are now! You own a cube, I own a cube, and all these other people in here enjoy their cubes and even a few sickos out there love their GBAs. How did it come to this???

I say, truly Nintendo has shown little attention to the GBA what with the new SP design which is better than the previous one in every way. But of course they were forced to do this because..? I guess because that’s what people wanted. Ruthless! And how thoughtless of them to maintain backward compatibility with all previous generations of GB games! It's all about the money!

Now I remember the PS2 launch well, for I passed on it completely and instead bought a Dreamcast (you know, "the ULTIMATE game system"). Reason was the PS2 had no decent launch titles. It wasn't worth it to me at the time and I wanted to give Sega another chance. My brother played mostly old PSX games on his PS2 for months until decent PS2 releases started to come along. Everyone knows the PS2 had a less than perfect start but it had a LONG time to pick up speed before any other competition came along and that is why it is still #1 now. That head start made a big difference. Eventually everyone bought one including myself and they continue to sell and it’s all about the games, which is what Xbox isn't all about. Is the discussion beginning to make sense?

But if you dony play your GBA then you could flush it down the toilet, or it might be a better move to sell it to someone who would play it. I don’t think you would have much trouble finding a buyer. I'll pass though, I already have two and I am going to get an SP when they're released here. Oh yeah, you might miss out on some of the connectivity between current and future games and the GBA, which seems to be catching on with more developers for some reason like this one I just heard about - maybe you know of them - SquareSoft. What was that about burning bridges?

I'm sure that whenever Microsoft and Sony "decide" to take the handheld market away from Nintendo it will be interesting to see how they accomplish it. Here's one way: get permission from Nintendo to make their handheld play all the GB, GBC, and GBA games! You may not remember a little handheld named the GameGear or another one named the Nomad both made by Sega which was putting a lot of heat on Nintendo at the time. In my opinion that hardware was far better than GameBoy. Nevertheless look where THEY are now.

I'm sure some type of Sony handheld would be a hit but they would have to start from zero. Nintendo has a huge library of games that will fit on those small ROM carts. Does Sony? Does Microsoft? No a portable PS2 that can play movies and still fit into the palm of your hand would be great. I'd buy one except realistically it would cost as much as a notebook PC. Probably would not be as popular with the 5 and 6 year olds then and that would hurt profits, and lose developers of the games we like as well.

I believe I've said enough on the subject, perhaps too much. Time will tell but I think most of us in here know enough about this market to make a better prediction that these other analysts. We know this market inside out and we make the purchases that ultimately determine the outcome.

I don't see Nintendo leaving the hardware market until people stop buying consoles and handhelds. Even then who knows. They can be stubborn. Remember these are the people who stuck with cartridge format for years after it was obsolete and even created that monstrosity known as the VirtualBoy!

StarBlueFebruary 27, 2003

I read VisualWarp's post and was thinking, didn't Sony release a hand held game system in Japan. Also I thought that it tanked so badly that it was pulled within a year of release. I might be wrong, someone correct me if I am. Also Xbox does have a portable game system, it is called a LAPTOP. In the last couple of days I have thought about something, many people are claiming that PC gaming is dead or dying. So did the Xbox just shoot Microsoft in its own foot? Think back 18 months, PC gaming is going strong and people buy new machines when games they want to play won't play on their old 486's and Pentium I's. So then comes along Xbox and people say well it is cheaper to buy an Xbox then a new PC, Hmmmmm $299 versus $2000. Also then the person can still use their PC for their checkbook and to write letters. Most of the Xbox games were to be PC ports (ie Midtown Madness, Crimson Skies, etc) or at least promised that PC game developers could easily bring their PC games to the Xbox with little fuss. So back to present day, the PC industry is in a Major slump, PC Games have staggnated, Microsoft sales of Windows and Office are down and stock is taking a beating. Every time someone buys an Xbox, Microsoft is loosing well over a hundred dollars or more. Before Xbox, Microsoft was MAKING a couple hundreds of dollars when they where forcing PC makers to put Windows on a new machine. If I was Bill Gates I would find the genius that thought up the Xbox and FIRED HIS ASS!!! Hey maybe if every GameCube owner out there went out and bought a Xbox, but never bought any games and just use it as a DVD player, I wonder how much a beating 10 Million units times $200 loss on each Xbox; that comes to a 2 Billion dollar loss. OUCH Bill might just have to drive the Lexus to work instead of the Mercedes Limo to make up the difference. Wow, now I sound like an analyst and can get Microsoft to dump Millions to me to change my analysis that says all of that will make Nintendo give up the market and Microsoft will rule the World.

Like VisualWarp, I too waited until something happend before getting an Xbox. For me the shoe fell when Rare was sold off, I am sorry I was WEAK!!! please forgive me but I just had to have the next Conker game. So far I have bought ONE game (Blinx) and it sucked, someone game me Shenmue II and it is ok but still looks like a Dreamcast game. So far I have a dusty DVD player aka Xbox, but hey it is a nice player. face-icon-small-wink.gif Hahahaha

StarBlue

)Dark-LInk(February 27, 2003

nicodemus FIRST OF ALL

FIRST OF ALL N is trating the gba and donst forget about it!can us e FINALY their releasing the SP!!

SECOND OF ALL gba is BADASS awsome little boy for entertainment

THIRD OF ALL look how many HAVE TRIED to end NINTENDO's MONOPOLY and glory as the KING OF THE HANDHELD!but I DONT SE them live for VERY LONG even if with their SUPERIOR hardware they FELL to the might of the little boy!and sony HAS tried once and FAILED WHAT makes u think ANYONE else can?

MikeHruseckyMike Hrusecky, Staff AlumnusFebruary 27, 2003

I think the point is overstated. PCs largely aren't purchased as game systems. And the quantity of Xboxs sold in the last 14 months is a drop in the bucket compared to PC sales, so there couldn't be any correlation that could be proven. PC sales are down, but Windows revenue is up. They're not struggling.

And off topic, until recently MS only made something like $40-90 per copy of Windows from OEMs, depending on OEM size. Now it's a semi-fixed price of $50.

MattFebruary 27, 2003

I think that Nintendo could remain profitable as a third party.

However, for now, it seems that thier current plan is WORKING, and its working fine.

They can't make major changes based on speculation.

Perfect CellFebruary 27, 2003

Well its interesting www.MSNBC.com reported that either EA sports or Microsoft will buy or is interested in buying Sega!, or is it Sega-Sammy or Segamy? face-icon-small-smile.gif Either way, if Sega after merging with Sammy is still in debt and needs to be bought out, then what does this say about turning Third Party? It says that going multi plataform when you were a console company DOESNT WORK, 3D0,Sega, are examples of this. Why would it be the logical choice for Nintendo when it didnt work for others? I really really hope it never happens. Ill probably stop buying videogame if it ever does......

MattFebruary 27, 2003

I'm confused... Sega-Sammy... what about Sega-AM2?

Perfect CellFebruary 27, 2003

Sega AM2 is a development team under the Sega branch. Sammy is another company that merged with Sega just recently.

SjaleshoMarch 01, 2003

Quote

Originally posted by: StarBlue
Also Xbox does have a portable game system, it is called a LAPTOP

StarBlue


Hahaha....quote of the day! I really laughed for minutes when I read that sentence and it's true also. face-icon-small-smile.gif

visualwarpMarch 01, 2003

Seems like every developer who has a rough year now is going to spawn rumors of Microsoft a buyout. That's exactly what we love to see, a Nazi-style Microsoft conquest of everything in the digital world. It's really kind of depressing.

I don't believe anyone here has mentioned yet how easy it will be to develop an Xbox emulator. It's only a matter of time before its BIOS is cracked, history has proven that any system can be cracked and emulated with enough people contributing to the project. Any PC or Notebook PC with a Pentium III and up, equal to or greater than the clock speed of a bona fide Xbox could theoretically do the same thing. They have told us it's based on PC technology from the beginning.

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