Nintendo Smartly Catches Up with the Rest of Us

Nintendo Smartly Catches Up with the Rest of Us

Nintendo. Legendary game developer and console manufacturer, it has fallen on hard times recently due to the failure of its Wii U console and the continued mobile assault on its handheld business. Opinions about the company have ranged far and wide, but all could agree that Nintendo had to take a look at itself and do something to turn fortunes around. Some glimmers appeared recently, with Amiibo toys selling briskly and providing a new way to reach kids and nostalgic audiences.

Recently, Nintendo took it to the next level with announcements that signal sudden and momentous shifts in its business approach. How positive were each of these moves for the company’s prospects?

Deal with DeNA to Develop Mobile Games and a Cross-Platform Service

This is exciting. Almost exactly what some analysts have been asking for. Nintendo has started a strategic partnership with DeNA, the experienced mobile developer, to build official Nintendo games for iOS and Android devices. The critical part of this announcement is that there are going to be no ports, all games would be built from the ground up for the mobile experience.

The other announcement is a cross-platform service, spanning smartphones, tablets, PCs, and Nintendo’s devices.

My Take: Nintendo is embracing mobile, but doing so cautiously. By not offering any of the games that it builds for its own platforms, it ensures that said platforms don’t suddenly have the rug pulled from under them. From first saying they’ll stick with the Wii U and 3DS, to then “exploring” mobile experiences, to now actively developing projects for iOS and Android, you could sense that this was a move that Nintendo always approached apprehensively.

It was all inevitable, however. With millions of kids growing up never seen or played their unique games or game consoles, Nintendo was running on borrowed time. Sure, they sold a ton of Amiibos (plastic figurines which enable special features in games), but that was mostly to those nostalgic for the company’s characters. Stuttering sales, not only for the hardware, but also for the software that symbolizes the company, have flashed warning signs for years.

With these new mobile “experiences,” Nintendo can suddenly reach a larger audience which it can later “promote” to using their hardware. Enjoy playing that Mario mini game? You’ll love jumping and messing around with your friends in front of a TV with Super Mario or Super Smash Brothers. Nintendo is approaching this from the right angle, and they can easily adjust their strategy based on where the market moves.

Nintendo's future takes place on many screens.

Nintendo’s future takes place on many screens.

NX Console

While just a drab placeholder name for now, the NX console is a large part of Nintendo’s future. This would presumably be the Wii U’s successor. CEO Iwata describes it as a brand new “concept.”

My Take: This is coming sooner than Nintendo would have liked, but the Wii U just isn’t enough and never was. The company smartly recognizes that there’s still some steam in the console market, as gleaned from PlayStation and Xbox’s stellar sales rates.

What do we expect from this console? Like with its predecessors, we know that it’ll have something uniquely Nintendo about it. Iwata has been heavily pushing his “Quality of Life” initiative with devices and services that would improve users’ standard of living. Perhaps the console will integrate with fitness wearables or somehow encourage physical and emotional activities.

The other hints were about the console’s form factor. Note that Iwata never confirmed whether the NX is going to be a handheld or TV console. Perhaps it is both. Iwata has previously discussed that handheld and console hardware development have recently been merged to facilitate moving games between the two form factors. Nintendo is also rumored to be chatting up ARM processor suppliers.

Of all the console companies, Nintendo would most easily pull off such a hybrid device first. They have never required cutting edge visuals, so an NX could conceivably be built on smartphone-level hardware and then easily integrate controller support and streaming to larger screens. It would be a device fitting of the times, if true.

There isn’t much more to say about the NX before more is announced next year, but this is a good sign that Nintendo is taking the Wii U’s failure in stride and pushing on to provide that unique Nintendo hardware experience.

That’s my take on Nintendo’s seismic announcements. Generally, the company is adapting to its difficulties and looks set up for future success. What do you think? Have they done enough, or should they embrace third party mobile platforms even more?