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Nintendo: no longer a leader, just a follower

Friday, 9th May 2014 09:23 GMT By Matt Martin

Skylanders knock-offs and devices for emerging markets. Nintendo is now steps behind the competition, says Matt Martin.

Mario McDonalds

“Nintendo is simply following the publishers, the console and mobile manufacturers, scrambling behind the bandwagon and struggling to keep up.”

There was a time when Nintendo led the video game market. A time before the rise of mobile gaming and next-generation consoles. The Wii came along with an inventive, intuitive control scheme that had publishers creating whole new departments dedicated to it, while rival manufacturers struggled to catch up with their own motion control solutions.

Now Nintendo is simply following the publishers, the console and mobile manufacturers, scrambling behind the bandwagon and struggling to keep up.

Nintendo’s latest ideas for innovation are two-fold; new hardware for emerging markets and a Skylanders-style NFC reader for figurines and games across the Wii U and 3DS. It will approach these new areas armed with it’s considerable character IP. On the surface both ideas are sound and reassure investors that Nintendo is doing all it can to identify new areas of business. I have no doubt that Nintendo’s characters are as beloved as they ever were. This week’s biggest story on VG247 by a large margin has been the re-release/remakes of two old Pokemon games. But I question whose hearts those characters are so dear to.

Activision’s Skylanders was the first real figure/video game success and the company has now sold over 175 million toys and generated $2 billion in sales – all from original IP. Disney’s Infinity has got off to a flying start, lifting the company’s long-suffering Interactive Division with its familiar characters. And it’s only going to get better for Disney with the release of Marvel Super Heroes and presumably Star Wars sets in time for the new movies. That’s a strong road map.

Nintendo has its work cut out for it if it hopes to grab a slice of a pie already being generously divided up by two companies. Of course Mario, Link, Kirby and friends are still popular – Nintendo has made a business of reusing its IP to create mega and meta games. Just look at Super Smash Bros. and Mario Kart, where characters from other games are spun-off into successful products in their own right. It doesn’t get more self-referential that than.

“Your mum doesn’t need a Wii remote to help her understand the fun of games anymore. It’s not 2007. She probably spends more on Candy Crush than you do on Wii U games.”

But there’s no denying Nintendo is late to the party. And as fun as these hybrids of games and toys are, they will only have a finite shelf life enjoyed by a notoriously fickle audience of children. Trends change, novelty value runs dry, children move on to the next big thing remarkably quickly.

And then there’s Iwata’s idea of new hardware for emerging markets. Nintendo can source increasingly cheaper parts for its consoles, but it still needs to establish distribution, sales and localisation for wherever these emerging markets are. It’s not easy, just ask Microsoft about its failed efforts with the Xbox business in Japan.

I would argue that the idea of “emerging” markets is already out of date. Where are you going to take these products? Brazil is thriving, dominated by free-to-play hits like League of Legends and a concerted push by Sony and Microsoft to establish a console presence. China emerged year’s back and is in the business of expanding itself into the West. Taiwan, South Korea, India – all have rapidly growing local markets. And companies like Apple, Google and other tech firms are already heavily invested in them with cheaper products, hardware, games and mobile handsets.

Nintendo’s problem is that it’s too late to react. Following isn’t necessarily a bad thing if you do what you do well, but the company doesn’t have a great history in this respect. Its online presence isn’t a patch on Steam, PSN or Xbox Live. Its Wii U tablet controller was released to punters who had already experienced the high build quality of the iPad. Once you’ve been wowed by that, it’s difficult to go back. And its attitude to social issues is straight out of the 80s.

Never underestimate Nintendo, they say. Nintendo always has the ability to surprise, they say. All of which have been true in the past. But your mum doesn’t need a Wii remote to help her understand the fun of games anymore. It’s not 2007. She probably spends more on Candy Crush than you do on Wii U games. The battle to convince a mainstream audience that gaming is enjoyable and credible entertainment is over. There’s no need for novelty hardware to explain it.

“Nintendo is a company that won’t release Mario on mobile formats but gladly gives him up for the latest McDonalds Happy Meals.”

And then there’s Nintendo’s attitude to its own brands, which it quite rightly protects as its crown jewels. But it needs to loosen the grip in the right places. This is a company that won’t release Mario on mobile formats but gladly gives him up for the latest McDonalds Happy Meals. Because that’s a quality brand Nintendo wants to be associated with? Nintendo, frankly, needs to get over itself. If it’s not careful it will find itself in Atari territory, where reminiscing about the company and buying into the nostalgia is more important than innovation. T-shirts with cute logos on them become favoured over new games.

Iwata says he wants Nintendo to leverage its strengths. Its strengths are remaking its own IP, reusing its characters as assets, re-creating games that we already love. That’s fine in principle, but it will never put the company at the forefront of the games business.

It will continue to be a follower if it does nothing more than regurgitate its own products on formats and in regions that have already been well proven, and where others have spent time and money building towards market dominance.

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22 Comments

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  1. Stardog

    Their games as we know them are unplayable on a touch screen. Mario/etc are unplayable on mobile emulators.

    They’d have to make really lame games to gouge everyone’s money.

    #1 3 months ago
  2. Legendaryboss

    Looks like treading carefully is not an option. But i’m still nterested in where this leads response wise. I can see it now.

    - You leave Pokemon out of this, Nintendo need a firm hit this Christmas and i want to head back to Hoenn (Conditional). Even if Wii U needs it most and theres a lot of potential for a big MMO, it won’t save it tho.

    #2 3 months ago
  3. Legendaryboss

    @2
    *Interested, good grief!

    #3 3 months ago
  4. RandomTiger

    “Its strengths are remaking its own IP, reusing its characters as assets, re-creating games that we already love.”

    It seems to me that this is exactly what the Nintendo core users want though, every time they announce a remake everyone who isn’t getting excited about playing it is asking for some more obscure IP to be remade as well.

    #4 3 months ago
  5. Gekidami

    @RandomTiger
    I’d say thats because people know Nintendo dont do anything else though. You want something new from KFC, you’re going to be asking for a new chicken recipe because KFC only to chicken. Nintendo only do their old IP’s, they only remake stuff for the nostalgic man-children stuck in the “good old days” of gaming (in their opinion).

    People ask Sony & MS to make new IP’s more often because they actually do that (one more than the other, of course).

    Nintendo are victims of themselves, in that regard. And of their fans who have rose-tinted nostalgia glasses super glued to their faces.

    #5 3 months ago
  6. Joe Musashi

    Nintendo, frankly, needs to get over itself.

    Amongst a number of well-presented points in the article, that one rings truest of all.

    JM

    #6 3 months ago
  7. polygem

    Nintendo need to be more Nintendo than ever before these days and they will benefit from it in the long run. They know it. They are aware of it. They are not passively reacting to a situation, they are preparing their business for the future, for a changing market, to make sure that they will be relevant in the future as they have been in the past. That´s what is happening right now. Even if the situation might not work out perfectly for them right now with a struggling WiiU – to differentiate from the competition even more is the key for their future survival. I am not sharing many recent internet anlysations of Nintendos situation at all. Imo they are terribbly short sighted and this piece is no exception.

    #7 3 months ago
  8. ManuOtaku

    While i do agree that nintendo is late to the party with figurines ala skylanders, and that this might have a big % of not succeeding, it also has posibilities of success if it is handled right, i mean one figurine that can be use on all next nintendo titles, and with mixing chatacters parts to make hybrids and funny characters.

    For The emerging markets, you mention brazil, and for example sony has just release psn plus on that market, therefore not all the console manufacturers have the total grasp of emerging markets, there is open space, the important thing is how well they will be implementing things, and i do agree with yoy on this point, lets hope for the best.
    The for releasing their ips and games on mobiled, first is not easy, they cannot grab all their games and put it on mobile, both are different and the experiences are different, is not as grab marii sunshine and put it on mobile, is not that easy, and probably it wont work, as for new games dedicated for mobile from scrartch, they can do it, the thing is they nees to adapt to thar type of games, which takes time and effort, not a short term solutions, neither of them
    As For being followers, they were in the past, since N64 days till wii and now again with the WiiU, there is difficult for a company to be always a leader, happened with sony, and microsoft has yet to be a leader, so it is quite hard. Now personally i prefer them being followers, companies that are all the time being leaders, get ti cocky, arrogant and losse perspective of what is important.

    #8 3 months ago
  9. Dragon

    I can guarantee can their “emerging market” plan will be a complete failure. They wont sell anything in Brazil, India and China, compared to what Sony has achieved for years and even MS with 360. Simply because “Nintendo, frankly, needs to get over itself.”.

    There core market is simply non-existent now outside of forums. They need new customers and Iwata isn’t capable of that by looking at things, and just too slow.

    #9 3 months ago
  10. the_8th_samurai

    Even back on the GameCube days Nintendo didn’t want to adopt emerging trends such as online gaming. They refuse to see what is blatantly obvious. This same principle applies to their stamce on mobile gaming for reasons unknown. Their stubberness and pride will hurt them in the end.

    #10 3 months ago
  11. Hassan_Fvckry

    Nintendo has to look like it is having fun too. Creating new IP and hardware is fine, but without any true enthusiasm, they’ll continue to look like a lifeless company. ||

    #11 3 months ago
  12. Panthro

    @Hassan_Fvckry

    If Nintendo is anything it definitely isn’t ‘lifeless’.

    I don’t own a WiiU but coming off the back of an n64 a Wii, DS and then a 3DS I would say they are far from lifeless, especially in comparison to the other console manufacturers.

    #12 3 months ago
  13. ij 44

    They need to kill all that mario bullshit and focus on Kirby

    #13 3 months ago
  14. ManuOtaku

    @ij 44 Do you mean the year of kirby?, that could work. Poor luigi his first year, and nintendo hits big losses, i hope kirbys year will be better.

    #14 3 months ago
  15. fearmonkey

    I never see Francis and Polygem on these Nintendo articles anymore…

    #15 3 months ago
  16. ManuOtaku

    @fearmonkey for what is worth, i will try to fill their place.

    #16 3 months ago
  17. ManuOtaku

    @fearmonkey with my personal style that is.

    #17 3 months ago
  18. ManuOtaku

    @fearmonkey hry he did comnented here, comment number 7.

    #18 3 months ago
  19. Dragon

    @fearmonkey,
    You really need some popcorn don’t you :P

    #19 3 months ago
  20. westman98

    @Dragon I can guarantee can their “emerging market” plan will be a complete failure. They wont sell anything in Brazil, India and China,..”

    By your logic, Microsoft’s emerging market plan with the Xbox One will be a complete failure as well. The Xbox One is too expensive, and many of its games will get banned by the Chinese government.

    “…compared to what Sony has achieved for years and even MS with 360. Simply because “Nintendo, frankly, needs to get over itself.”

    Sony has sold zero PS4′s in Brazil, and has yet to release the PS4 in China.

    I get it. You obviously want Nintendo to go third party and make Xbox/PS games. But there is no need to treat your statements as if they were “guaranteed” to occur.

    #20 3 months ago
  21. sperko

    They need a good partner. Valve needs a good partner. That combo will rule the galaxy of videogames.

    #21 3 months ago
  22. Dragon

    @westman98 ,
    “By your logic, Microsoft’s emerging market plan with the Xbox One will be a complete failure as well. The Xbox One is too expensive, and many of its games will get banned by the Chinese government.”
    Yes. And many experts agree with this, even Chinese devs like Spice Horse.
    http://www.gamesindustry.biz/articles/2014-05-01-american-mcgee-xbox-one-will-fail-in-china

    “Sony has sold zero PS4′s in Brazil”
    Lolwut? PS4 is available for months there, and can be brought for about $700 in grey market, about the same price as X1.

    So, yeah, before “I get it”, get your facts straight, since its clear your knowledge is quite outdated and laughable on the topic.

    #22 3 months ago