Is the home console business viable for Nintendo?

[Johnny Novgorod]

I agree with "Nintendo isn't going anywhere (because it has the gross domestic product of a small country and can fuck about 120 years before having to suffer for it)", but I'd like to put things in perspective, since it is, as you say, all a matter of perspective.

All this doomsaying based on basically nothing...

No, it's based on the fact Sony is outselling Nintendo 2-to-1 even though the Wii U was released a full year before the PS4, Nintendo sold only 5% of its target in 2013 and sales forecast went from 9 million to 2.8 million in 2014, making it the company's slowest-selling console in history.

Choose to ignore this if you will, but there's plenty to go around on the subject of Nintendo not performing swimmingly.

Nintendo consoles have always been profitable. The NES and SNES 'won' their generations. The N64 was second

Sony outsold it 3-to-1.

The gamecube was third.

Sony outsold it 7-to-1.

The Wii? Well, do I even need to say it? The 'it prints money meme' exists for a reason. It was the most successful console of the generation by a wide margin

A whopping 25%.

The Wii U? OK, so compared to the Wii it looks very bad.

Yup.

But it's sales figures are still in the millions.

They're all in the millions.

Like, 9 million so far or something. (in about 2 years)

Sony sold 18.5 million so far or something. (in about 1 year)

To put this in context, the gamecube sold 22 million in it's lifetime. So, the Wii U is on track to at least match the gamecube.

Congratulations, the Wii U is catching up to Nintendo's worst-selling console of all time.

It's all a matter of perspective.

Indeed.

 

[CrystalShadow]

I agree with "Nintendo isn't going anywhere (because it has the gross domestic product of a small country and can fuck about 120 years before having to suffer for it)", but I'd like to put things in perspective, since it is, as you say, all a matter of perspective.

All this doomsaying based on basically nothing...

~slow clap~ Quoting things out of context. Well done. Always a good start for your credibility.

You do realise in context 'doomsaying' is about Nintendo releasing a new console ahead of it's time, right? Cause, you know. Makes your response completely meaningless if you can't even get the context right.

No, it's based on the fact Sony is outselling Nintendo 2-to-1 even though the Wii U was released a full year before the PS4, Nintendo sold only 5% of its target in 2013 and sales forecast went from 9 million to 2.8 million in 2014, making it the company's slowest-selling console in history.

Choose to ignore this if you will, but there's plenty to go around on the subject of Nintendo not performing swimmingly.

Irrelevant, meaningless in context to what you're replying to, so it amounts to little more than a strawman response.
Ugh.

Nintendo consoles have always been profitable. The NES and SNES 'won' their generations. The N64 was second

Sony outsold it 3-to-1.

Irrelevant, and again your out of context quotes aren't helping you here. Besides which, it doesn't negate what I said.
The N64 WAS second in it's generation. By how much of a margin is completely irrelevant, and you replying that way shows you completely missed the point of what I said.

The gamecube was third.

Sony outsold it 7-to-1.

Again, that's irrelevant to the fact that the gamecube was profitable and third in it's generation

You make replies as if you are contradicting something, yet you ignore my argument entirely, and quote something as if it disproves what I said, when it does no such thing. It's extra (irrelevant) information, that you are using as if it somehow disproves my (factual) statement.

The Wii? Well, do I even need to say it? The 'it prints money meme' exists for a reason. It was the most successful console of the generation by a wide margin

A whopping 25%.

You think 25% is insignificant? Interesting.

But then again, you're also glossing over the fact that every single Wii sold was sold at a profit. The same can't be said of it's competitors. Thus, even with equal sales, it's competition could be worse off than it, let alone with worse sales.

The Wii U? OK, so compared to the Wii it looks very bad.

Yup.

But it's sales figures are still in the millions.

They're all in the millions.

So? Contrary to popular belief, 'winning the competition' is not equal to 'success'
The sales figures of the Wii U are high enough.
The Wii U has sold millions, and is still selling

You want to see an actual failure? The Virtual boy sold 700,000 units, and was no longer available within a matter of months after it's launch. That's what failure looks like.
The Wii U is in a completely different position.

Like, 9 million so far or something. (in about 2 years)

Sony sold 18.5 million so far or something. (in about 1 year)

What's the profit margin on those sales, hmm? My guess is it's a negative number. Which from a business perspective renders it a moot point

To put this in context, the gamecube sold 22 million in it's lifetime. So, the Wii U is on track to at least match the gamecube.

Congratulations, the Wii U is catching up to Nintendo's worst-selling console of all time.

Again, out of context quote that misses the point of what I said. Congratulations on your strawman argument, and basically completely steamrolling my point in favour of something else entirely

It's all a matter of perspective.

Indeed.

Yup. And you basically steamrolled the purpose of what I said in favour of reinforcing the standard gamer fanboy argument that is completely irrelevant to the success of any business...

Well done.

I'm so impressed with your debating skills...

 

[Johnny Novgorod]

No, it's based on the fact Sony is outselling Nintendo 2-to-1 even though the Wii U was released a full year before the PS4, Nintendo sold only 5% of its target in 2013 and sales forecast went from 9 million to 2.8 million in 2014, making it the company's slowest-selling console in history.

Choose to ignore this if you will, but there's plenty to go around on the subject of Nintendo not performing swimmingly.

Irrelevant, meaningless in context to what you're replying to, so it amounts to little more than a strawman response.
Ugh.

Disclaimer: I never fully understood what 'strawman' meant. People seem to find it everywhere though.

You said Nintendo is doing great, I said no and explained why. You say numbers don't matter, yet put a lot of focus on how every console was financially profitable to Nintendo, and how the Wii was the best thing in its generation and outsold Sony and Microsoft... so maybe numbers matter to you, but they don't matter so much if the numbers aren't high enough? You award 2nd and 3rd places like they're silver and bronze medals, while choosing to ignore the astronomical distances between those places and 1st. Yes, Nintendo made 3rd place in a race with 3 players. Yes, Nintendo made 2nd place... but sold three times less than its competitor. I'm just adding perspective.

You think 25% is insignificant? Interesting.

Well it is. Compared to how the PS1 sold 300% more and the PS2 sold 700% more, I think the Wii selling 25% more in that context is a bit laughable as far as victories go. So yes, pretty interesting.

So? Contrary to popular belief, 'winning the competition' is not equal to 'success'
The sales figures of the Wii U are high enough.
The Wii U has sold millions, and is still selling

Just pointing out comparing the Wii U to the GameCube is literally the slowest standard to have for Nintendo, since it was their worst selling home console. You bring up the Virtual Boy gimmick, but the thread is about home consoles, not handheld gadgetry.

Like, 9 million so far or something. (in about 2 years)

Sony sold 18.5 million so far or something. (in about 1 year)

What's the profit margin on those sales, hmm? My guess is it's a negative number. Which from a business perspective renders it a moot point

This guess of yours is made on what, exactly? On the source you didn't quote and the rationale you didn't explain?

Again, out of context quote that misses the point of what I said. Congratulations on your strawman argument, and basically completely steamrolling my point in favour of something else entirely

You keep using that word.

I'm so impressed with your debating skills...

I, on the other hand, am not impressed by the way you had to resort to sarcasm and personal attacks to satisfyingly reply to a wholly impersonal, objective post.

 

[joest01]

I rate the probability much higher that one of the other two go away. sony could very well go out of business, they are hanging on by a thread. And msft will sooner or later need to focus on their main business or lose it to the cloud.

On a related note, i read somewhere that the difference between casual and hardcore gaming is really in the look, not gameplay. That rings true somehow. Maybe nintendo makes kids games, but in the sense of cartoony looks as well as finger dexterity.

 

[Lightknight]

At this point in the PS3's life, I remember people calling it a massive flop. I remember that well. But it picked up. Why?

No, you must not remember it clearly. The PS3 was considered a flop in its first half year because the price tag was killing it. In the year it launched the 360 sold double it's numbers in December despite the 360 having already been out for a year. December was like 800k units for the PS3 which was terrible.

But then, Sony had a sale in March 2007 and saw a huge increase of sales there. Then they dropped it into the $399 range that October and ended up outselling the 360 for the year (by only about 8k units, they were neck and neck). So that's a complete turn around in one year as far as number of units sold.

The WiiU was released in 2012. It is entering it's third year. So no, "at this point in the PS3's life" things were going great, they were no longer considered a flop. In fact, at this time in it's life Sony had seen the last time the 360 would ever sell more units than it for the rest of it's life including right now.

You've got to understand, we're far enough into it to see what's going on. It's selling slower than any console Nintendo has released. Nintendo has fully acknowledged their failure and you should too. It isn't that the console is bad. It's just unnecessarily expensive for the hardware they provide while being while too underpowered to get the sort of 3rd party titles other consoles are enjoying.

 

[Lightknight]

You attributed the wrong quote to me. I said the portion you are directly responding to, not the portion with the person saying "I'm fairly certain they know what they're doing". I certainly wouldn't say that.

I'm sorry, but that's a real non-statement that people read way too much into. So miyamoto said they're working on a new console.
Big deal. Do you have any idea what the lead time on developing a new console is?

The Wii was released in 2006, and they first came up with the idea in 2001. The console was first announced to the public in 2004, 2 years before release.

(in case you missed it, that's 5 years of development, with an announcement which as I recall already explained the basic premise of the new console 2 years before it's release)

I'm fairly sure the N64 and Gamecube were announced way ahead of their actual releases too.

Given the typical console lifecycle, vaguely hinting at 'we have a new design in the works' at this point is blatantly pointing out the obvious.

Worse, given they are talking of 'experimenting with new ideas' that makes it even less likely they are quite ready to announce a new system.

And even if they make a more concrete announcement some time this year, given past history, that suggests a 2017 release at the earliest. Which is... Guess what? a standard 5 year console cycle... >_>

All this doomsaying based on basically nothing...

The point isn't that they said they are working on the replacement. The point is that they're discussing it while talking about the dismal sales of the WiiU. If the WiiU's successor is only two years out, then the WiiU has a very short life. There is a tremendous difference between looking at a different product to solve your problems vs looking at how you can make the current one better. They are instead saying that they'll continue to make quality titles for the WiiU. Which is nice and all, but that's end of life talk.

 

[Doom972]

With their current console design method, which is extremely outdated, they can't make a successful home console. They use outdated hardware and don't send prototypes to game developers for feedback (MS and Sony do this). A console can't be competitive without decent 3rd party support.

I get from Nintendo the impression that it's a company full of yes-men and that nobody will dare question their methods. Companies that don't adapt to change don't last.

 

[Mutant1988]

I think Nintendo can do just fine with their home consoles as long as they keep releasing first party games for them. But what they really need and I hate to say it as I would much rather see it for anything else, is a dedicated online focused RPG that's 100% exclusive to their platform. That alongside their usual stable of first party Mario, Zelda and Smash games will keep them competitive.

I think sticking with the Wii-U is a wise decision, as long as they can ensure that the prices for it's manufacture and maintenance isn't rising. Say by changed terms for usage of licensed hardware components, as is the case with most GPUs and CPUs, those being the actual core of the system. This being what prematurely killed the original Xbox (That or Microsoft just didn't feel like renewing the same terms).

If they don't incur a greater loss over time and make profits of the software released (Big if) they will be just fine. They would probably do well to add more incentives for third party developers though, especially in the area of local multiplayer games. That is the one massive selling point the Wii-U has over all it's competitors - It's a party console and something you play with friends.

So in summary:

1. Keep going with the Wii-U as long as it doesn't lose more than it makes back. A new console would probably cost you even more and it might be better to hang back for this round and push out the first console the next time around.

2. Keep cranking out the token and nostalgia pandering first party titles.

3. Get some exclusive games (Because as a multi-platform release it is incredibly hard to compete with the current generation of consoles, even less PC) with considerable longevity of play, especially ones geared towards multiple players. The very best approach I think is to sell the console as a companion to a PC. Wii-U for Nintendo games and the PC for all the other ones.

A marketing campaign that pokes fun at how the "next-generation" of consoles still can't keep up with PCs to go along with that is entirely voluntary of course. "But at least you get Nintendo games on your Wii-U."

Hell, getting friendly with one of the PC hardware makes to make branded PCs might be a decent idea and putting out some kind of interconnection of Wii-U and PCs. Network media management, save backups, that sort of thing.

4. More party games and more local multiplayer - Do more of the thing you are the very best at.

No matter how it goes though, I think Nintendo as a company isn't going anywhere.

 

[EbonBehelit]

*Snip* They use outdated hardware *Snip*

To be fair, so do Microsoft and Sony - it's just that Nintendo tend to be a bit more economical about it. It kinda shows too, since getting games to run at 60fps is considerably easier when you're not trying to push the hardware so much.

I do agree with ya on the whole 'behind the times' remark though: Nintendo really doesn't seem to understand how good Youtubers are for business yet.

 

[OhNoYouDidnt]

I do agree with ya on the whole 'behind the times' remark though: Nintendo really doesn't seem to understand how good Youtubers are for business yet.

To be fair, whilst it doesn't excuse Nintendo's stupid YouTube policy, let's not forget that Microsoft doesn't like YouTubers using their game titles in the video titles or descriptions. A stream or video simply called "Halo Master Chief Collection" would violate Microsoft's video content policy. A bit silly, innit.

 

[Mangod]

I do agree with ya on the whole 'behind the times' remark though: Nintendo really doesn't seem to understand how good Youtubers are for business yet.

To be fair, whilst it doesn't excuse Nintendo's stupid YouTube policy, let's not forget that Microsoft doesn't like YouTubers using their game titles in the video titles or descriptions. A stream or video simply called "Halo Master Chief Collection" would violate Microsoft's video content policy. A bit silly, innit.

Actually, I think Microsoft came out and said that you are allowed to use Halo in the name of your Let's Play video. Granted, I can't remember exactly where I heard/read that...

 

[Shirastro]

Caught up between all the Xbox vs PS console war people tend to forget the the "war" for the previous gen consoles was won by Nintendo. You could have asked the same question in the period of Gamecube, which also "flopped" compared to PS2 and yet Nintendo is still here making home consoles.

 

[Johnny Novgorod]

Caught up between all the Xbox vs PS console war people tend to forget the the "war" for the previous gen consoles was won by Nintendo.

I don't doubt for a second that Nintendo will continue on business (if not because it "wins" this generation, then because it has a fucking ton of money to lose yet). And for the record, the GameCube didn't just "flop compared to the PS2": it flopped compared to anything in that generation. And now the Wii U is selling even slower than that. On the bright side, it's still selling better than the Xbone. To keep tabs on sales (NOT "units shipped") so far:

PS4 - 18.5 million
Wii U - 9.2 million
Xbone - 3.0 million

 

[tstorm823]

At the end of the day, if you're having a great deal of fun with your console then that's all that matters. It doesn't invalidate the choice you made of going with the WiiU and it can't take away any of the fun you've been having. It may impact your fun in the future but that's not here yet. Yes, the WiiU is selling poorly. But the individual games are still performing well and this crossroads for Nintendo is really just an opportunity for them to try again. So take heart and keep enjoying your games.

You say the wiiu is selling poorly, but you (and everyone else saying similar things) are using a metric that doesn't make a whole lot of sense to me. People compare sales numbers for hypothetically comparable systems and declare the lower number a loser that's doing poorly, but I don't imagine people saying things like this about other industries. I don't imagine anyone going "the Toyota Prius is such a failure because they didn't sell as many as the Ford Focus." Or "Subway is a flop, it doesn't keep up with the sales figures of McDonald's." Or to go with an example that isn't just lower price selling faster, nobody's saying "cheaper smartphone makers should just drop out if they aren't keeping up with the iphone."

Nintendo is selling a system that people enjoy and releasing regular, consistently well recieved games for it, and doing so at a rate that along with some smart investment seems to keep them consistently financially viable. The sales numbers from the wii or ps4 don't invalidate that. They aren't thinking about crossroads and trying again. This is their business. If they can balance their budget with 10-20 million units a console cycle, they seem fine with that.

 

[Zacharious-khan]

Nintendo is the only viable console maker because i already own a PC and rarely do game i desire to play not get a PC port

 

[Johnny Novgorod]

At the end of the day, if you're having a great deal of fun with your console then that's all that matters. It doesn't invalidate the choice you made of going with the WiiU and it can't take away any of the fun you've been having. It may impact your fun in the future but that's not here yet. Yes, the WiiU is selling poorly. But the individual games are still performing well and this crossroads for Nintendo is really just an opportunity for them to try again. So take heart and keep enjoying your games.

You say the wiiu is selling poorly, but you (and everyone else saying similar things) are using a metric that doesn't make a whole lot of sense to me. People compare sales numbers for hypothetically comparable systems and declare the lower number a loser that's doing poorly, but I don't imagine people saying things like this about other industries. I don't imagine anyone going "the Toyota Prius is such a failure because they didn't sell as many as the Ford Focus." Or "Subway is a flop, it doesn't keep up with the sales figures of McDonald's." Or to go with an example that isn't just lower price selling faster, nobody's saying "cheaper smartphone makers should just drop out if they aren't keeping up with the iphone."

These are all poor analogies. We're talking about a market (consoles) that's neatly divided in three parts, not something that involves hundreds of companies like cars, phones and fast food (speaking of which, McDonald's market isn't Subway's). These are three companies that pretty much make up the entire console market and whose target demographic are all more or less the same. Hence the competitivity. They're all selling the same thing and trying to reach the same people.

 

[lord.jeff]

Maybe this conversation should wait till after one of it's biggest hitters comes out which is right on the horizon, you know the new Zelda game.

 

[tstorm823]

These are all poor analogies. We're talking about a market (consoles) that's neatly divided in three parts, not something that involves hundreds of companies like cars, phones and fast food (speaking of which, McDonald's market isn't Subway's). These are three companies that pretty much make up the entire console market and whose target demographic are all more or less the same. Hence the competitivity. They're all selling the same thing and trying to reach the same people.

Do you really believe that? You think subway and mcdonalds are different products for different demographics but wiiu, ps4, and xbox one are the same product for the same demographic?

 

[Johnny Novgorod]

These are all poor analogies. We're talking about a market (consoles) that's neatly divided in three parts, not something that involves hundreds of companies like cars, phones and fast food (speaking of which, McDonald's market isn't Subway's). These are three companies that pretty much make up the entire console market and whose target demographic are all more or less the same. Hence the competitivity. They're all selling the same thing and trying to reach the same people.

Do you really believe that? You think subway and mcdonalds are different products for different demographics but wiiu, ps4, and xbox one are the same product for the same demographic?

Yes.

It's a short answer, but it's a yes/no question.

 

[kilenem]

I going to tackle this question on to aspects Financial and technological. Nintendo is still doing the best out of the big 3 financially. I believe the PS3 ate up all of the profits from the PS2 era. Sony hasn't been getting rid of developers for the four years, even though there console and handheld Library is pretty small. Hopefully Sony post a profit this year because there businesses has been negatively affecting the Playstation. The Xbox brand hasn't posted a profit ever, Like the first Xbox put Microsoft 3 billion in the whole, you add the RRD and the X1 price cut/Kinect removal I don't think the Xbox brand will ever be profitable. Sony or Microsoft will probably drop out before Nintendo does leaving Nintendo with a larger market share.

My argument Tech wise is that we are seeing tech advancing so far smart phones have stronger graphics cards then the phone. Its already rumored that Nintendo's next project will be a fusion of a handheld and Console. My bet is the Next Nintendo project will be handheld that can play Wii u and 3DS games. Maybe it will be a Graphically on point with the PS4 but I don't think so.

Also Nintendo needs to play ball with Third Party developers. Whore out some of your Franchises to Third Party developers. We've seen it with Dynasty Warriors and NBA street Volume 3 Superior version was on the GameCube because you Could Dunk on Fool with Peach.