The Problem With… Nintendo

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I’ve pretty much been a lifelong Nintendo fan, receiving a NES at about the age of 6. Since then I’ve owned every major platform they have released apart from the ill fated Virtual boy. I’m still a huge Nintendo fan to this day, but they really infuriate me with some of the stubborn decisions they make. Nintendo have always followed their own path and have consistently innovated and pioneered a lot of main stay features from the Rumble Pak to analogue sticks. At times though, Nintendo’s blind refusal to compete and stay relevant is just baffling.

There are several main points of contention that I believe Nintendo need to address. Without doing so they will find themselves drifting further away from consumer’s expectations.

Console Branding

Let’s start by tackling the whole branding shambles. Nintendo have always tended to stick to a familiar naming convention (as do Sony and Microsoft) and in the past this worked out relatively fine. It’s fairly easy to understand a Super Nintendo is better than a Nintendo and that a Game Boy Advance is better than a mere Game Boy.

Nintendo Entertainment System
Super Nintendo Entertainment System
Nintendo 64

Game Boy
Game Boy Color
Game Boy Advance

Starting with the Wii and DS eras Nintendo have increasingly made poor marketing decisions when branding a console or handheld. As many will remember, codename “Revolution”1 was later renamed Wii which wasn’t exactly a fan favourite. Many fans will remember the jokes and digs at the name during the early days of Wii. Nintendo didn’t learn from this negative reception, in fact they refused to let go of both the “Wii” and “DS” brands by naming their subsequent consoles “Wii U” and “3DS”.

The DS itself isn’t necessarily a bad name and indeed it sold in excess of 154 million units2 making it the second best selling console of all time behind the PS23. So poor branding couldn’t have really been a factor here, the problem comes from branding successive consoles with extremely similar names. The hugely successful sales of the Wii and DS family might be one reason why Nintendo decided to use these brands to encompass the Wii U and 3DS. The problem here is that the majority of people aren’t typical gamers, they don’t read up on gaming news on a daily basis and they don’t keep up with the happenings of major game companies such as Nintendo, Sony and Microsoft. I’d forgive the average parent then if they were under the assumption that the 3DS is identical to the DS other than the ability to transform DS games into stereoscopic 3D. After all, Nintendo had already released a range of DS consoles from the DS, DS lite, DSi and DSi XL, all of which were based around the standard DS model. The DSi had a handful of games that were not compatible with the DS and so it was essentially an intermediary step towards a new handheld, a DS 1.5 if you will.

To make matters worse Nintendo created the 3DS family which currently consists of 3DS, 3DS XL, 2DS (more on this in a moment), New 3DS and New 3DS XL. It isn’t exactly obvious if somebody states “I have just bought myself a new 3DS”. What does this even mean now? Are we talking about the most recent model titled “New 3DS” or is the person referring to a brand new original 3DS console as opposed to a second hand one?

The 2DS is yet another example of the poorly chosen branding Nintendo are becoming synonymous with. How does a parent differentiate between a DS, DSi, 3DS, 2DS and New 3DS, let alone the lite and XL variations? Ah, the 3DS is like a DS but with a 3D slider? So the 2DS is the 3DS without the 3D? Is it a DS then? No, actually it’s not a DS. My head hurts just writing this paragraph.

wiiu

The Wii U branding is even worse; just take a look at the announcement trailer4. The entire focus here was on the “new controller”, each new piece of text that flashed up on screen talked about “… the new controller”. In fact, there was no mention of the actual console (which looks remarkably similar to the Wii by the way, confusing the matter even more) and it was only shown on screen for a few seconds, in the background. The Wii’s unique motion controls were in part responsible for its huge lifetime sales. Many will remember the stories of elderly and children alike all enjoying a game of tennis on Wii Sports. The concept was simple, hold this thing that looks like a TV remote and just swing it as you would a tennis racquet. It’s pretty understandable that Nintendo may have come to the conclusion that a similar marketing strategy would work for the Wii U – advertise the controller, it will sell the system. There was only one problem; it confused a whole lot of people. What had they just watched? Did Nintendo just reveal a new controller for the Wii? Satoru Iwata later went on to acknowledge this marketing mistake5 yet Nintendo still don’t seem to realise the brand names themselves are causing some of this confusion.

Sony’s consoles are clearly identifiable; they all look different for a start. Sony use numbers to denote their home systems (PS1, PS2 etc…) while their handheld straight up use different names (Portable, aka PSP and Vita). Most people can easily understand that the PS3 must be the successor to the PS2. Can anybody not in the know really come to the conclusion that the Wii U is the successor to the Wii? Or that the 3DS is the successor to the DS but not the 2DS?

Nintendo simply need to step back and think about how their branding will come across to a consumer who knows nothing about their products. It’s all well and good for a consumer who reads games journalism outlets and lives and breathes games but what about a parent buying their 6 year old a console for the first time? If you must stick with Wii, then name the successor a “Super Wii” at the very least. Really though Nintendo need to shake off the Wii branding as the Wii U really hasn’t taken off as expected and the Wii is now known to many people as the console that collected dust and filled people’s homes with shovelware. Due to the confusion with the DS, 3DS, and New 3DS I’d suggest Nintendo move away from the “DS” branding altogether.

Horse Power 

I’m slightly torn over this one as I firmly believe game play is king, not graphics, not horsepower. There does come a point however where you wonder why Nintendo refuses to keep up with the competition. Iwata has addressed this issue before6 however, and he seems keen on Nintendo continuing to innovate and carve their own path through the games industry.

Link_und_Epona_(Twilight_Princess)

Nintendo consoles are generally considered to be under powered compared to their competition. It’s easy to see why they go for this approach; they can use cheaper components and sell a system based on unique features and well loved franchises. Each system can then sell for a profit, which is unheard of in an industry of loss leaders7. The Wii U bucked this trend by selling for a loss8 but what is under the hood didn’t exactly scream “next gen” when the system was released back in 2012. Comparison charts between the current 3 home consoles9 only need to be glanced at to immediately see how under powered the Wii U is. In fact, the Wii U would be far more at home being compared to the PS3 and Xbox 360 which are 6 and 7 years it’s senior respectively.

There is nothing immediately wrong with Nintendo systems being under powered as long as there is a good catalogue of games. Fans will buy a Nintendo system for the Nintendo exclusive franchises, but will the average consumer? Hardcore fans are quite happy with the device sitting and gathering dust for several months a year while waiting for the next big exclusive. Nintendo have become many gamers secondary console of choice and for the majority of the year gamers will play with a Sony or Microsoft console then hop across to a Nintendo platform every couple of months to play an exclusive. And here we get to the real problem, 3rd party support. Having multiple consoles myself, I don’t really care if 3rd party support comes to Nintendo or not because I’ll just fire up my PS3 or PS4 and play games on those devices. However a large amount of gamers (particularly children) are not always in a position to have multiple consoles. They are left with a choice between a handful of really great Nintendo games or buying either a PS4 or Xbox One and playing their exclusives as well as a large amount of 3rd party games.

Nintendo could arguably dominate the market if they were to release a similarly powerful console complete with all of their historic franchises that consumers know and love as well as offering the same multi-platform games that both Sony and Microsoft provide. Developers would want to release games on the system because they wouldn’t have to create a stand alone, downgraded port just to run on that system. Porting games between PS4, Xbox One and PC is a fairly standard practice and can financially make sense. Porting a game to Wii U just doesn’t make great business sense because more effort has to go into the downgraded port and with such a small install base the risk isn’t worth taking.

As for the next system, well Nintendo have merged their hand held and home console R&D departments10. Many speculate that this merge may result in a future console being a hybrid device that can be hooked up to a TV and played like a traditional console as well as being portable. Whatever Nintendo choose to do going forward I believe they need to create a console powerful enough to compete with their rivals. Nintendo should take a hit on the sales of a new, powerful console and provide developers and consumers with a viable alternative to Sony and Microsoft’s offerings. This is the only way they will draw in 3rd party developers and increase their install base as a result. If Nintendo really want to impress they should look ahead to technologies that will be common place in 3 or 4 years time and aim to release a new home system in around 2 years time. This decision would allow for developers to easily port between all current consoles and PC as well as allow Nintendo to also show off powerful new exclusive games that wouldn’t be possible on the PS4 and Xbox One. If they wait too long to release a new system there will be early rumours of whatever Sony and Microsoft offer next, by this point many consumers will just hold tight until these consoles are released.

Cross-buy

Both Nintendo and Sony actively support multiple platforms yet Sony has been far more active in creating an eco system. When purchasing a game customers expect many will work across a combination of PS3, PS4 and Vita (if not all 3) all for one price. This isn’t always the case but there are countless examples of games being released and given away for free to previous customers, Dead Nation11 being one such example. Nintendo on the other hand haven’t made their ecosystem quite as friendly. This means that if you buy a virtual console game such as Mega Man on the 3DS there is nothing tying your Wii U account to that Mega Man purchase. In this instance you’d have to buy the game again on the Wii U if you wanted to continue playing on that platform.

I’m not aware of any sales figures that would highlight how many customers are buying a game twice because they want to play it on both the 3DS and the Wii U. Personally Nintendo are losing money from me as I hardly ever buy virtual console games because I don’t like the fact that Nintendo won’t let me play them on multiple systems. My digital library over on the Sony ecosystem however is pretty extensive, in part because I’ve had the ability to buy games on my PS3 and later replay them on my Vita. More recently games have then been ported over to the PS4 where I’ve had the option to download them again for no additional cost.

Nintendo online accounts, coupled with the lack of cross-buy feel downright archaic. What’s worse is customers cannot visit an online store to browse for and buy content. Generally when I receive an RSS feed from Sony informing me about a sale I’ll click through to the store and end up buying a few games if they take my fancy. It’s convenient to quickly log in and make a purchase while it’s fresh in my mind. Nintendo on the other hand don’t tend to have many sales and even when they do I’d have to be at home, boot up my console and head over to the shop then search for the game.

MvsDK

Nintendo are slowly making steps to improve their ecosystem as we’ve seen with Mario VS. Donkey Kong: Tipping Stars12 recently being announced as a buy one version and get the other one for free deal. We might yet make some progress, however this is labelled as a “Special offer”, potentially meaning in a few months time the offer will no longer stand. Keeping a back catalogue of virtual console games is also possible by using the system transfer to permanently move all purchases from the Wii to the Wii U. The catch here is that the virtual console games have to be played with the Wii U booted into Wii system mode. A small payment can be made to update some games to work in the Wii U OS, however the current virtual console library for Wii U is pretty lacking.

Now in terms of preserving the history that Nintendo are famous for they really need to sort out their virtual console. For a start we need at least some sort of preservation of existing purchases, I don’t want to be buying a copy of Super Mario Bros. For every Nintendo console I own. At the very least I’d like the ability to purchase a game and play it on my Wii U or 3DS without buying 2 copies. Ideally though, I’d like the Nintendo ecosystem to evolve enough so that I only have to buy a VC game once. At which point the game is tied to my account and I can access it from any future Nintendo platform. This might seem like a bad idea from Nintendo’s point of view because they’d only make money from one purchase but look at it this way, how often are consumers going to keep purchasing the same game over and over again? I know I’d buy more VC games if I thought I’d be able to access them on future platforms. That being said I know the Wii U VC library is lacking at the moment and part of that is down to porting games to work with the gamepad. There would have to be a compromise in creating a VC platform that would remain relatively unchanged on future platforms. Nintendo would need to avoid using time and resources continually porting old games to new systems. And don’t forget, Nintendo might then only generate one sale per game from veteran gamers but with every new generation of consoles comes a new generation of gamers who have all this history to discover. Think of it like iTunes, I buy a lot of my music digitally now because I can always access it through my account. If I had to re-buy my iTunes music every time I bought a new device I’d think twice about buying an album.

Nintendo Creators Program

If Nintendo haven’t already done enough to prove they have lost touch with their fans then the recent youtube program just tops it off. Essentially this program allows Nintendo to siphon off earnings from every youtube creator that posts videos featuring Nintendo games13. If a content creator doesn’t sign up to this program their content can be removed for copyright infringement. On the other hand they can choose to sign up and give Nintendo 30% of their total channel earnings or 40% for single videos14. There is no question of the legality here, Nintendo own the original material and are perfectly within their rights to take a cut of these earnings.

In the modern age the way we consume media is drastically changing. With the rise of on-demand TV and sites like youtube many people now consume media as and when they are ready. Consumers subscribe to their favourite channels not only to view various pieces of media but also to interact with content creators. Many channels now feature “Let’s play” videos, these consist of a content creator streaming themselves playing through a game. Some narrate their experiences, some review and critique games while others offer walkthrough advice. Most creators monetise their channels and make a small amount of profit for each view they receive so essentially these creators are making money by streaming copyrighted material that they do now own. This is where Nintendo decided to step in and cash in on their games being streamed.

miyamoto

So why is the creators program such a mistake? Aren’t Nintendo losing out on revenue if they don’t put this program into effect? Well yes but on the other hand many games companies are now getting free marketing. What better way to market a game than watching a likeable “real” person playing a game they have actually chosen to play rather than being asked to play? When viewers watch their favourite content creator having fun with a game they are much more likely to want to play that game than they would be from watching a very fake family in a studio “living room” all pretending to enjoy a game that they are being paid to advertise. So with Nintendo now forcing creators to pay a share of their profits many well known channels will be boycotting Nintendo games. Kinda Funny15 and PewDiePie16 have both expressed that while they admit Nintendo are within their rights to do this it’s not exactly a clever move. Colin of Kinda Funny went on to state that they will simply stop doing Nintendo content all together if this starts to affect them.

I’d just like to add that streaming a game cannot be compared to streaming a film or TV show. The core experience with the former involves interacting with the medium and making choices of some sort which you cannot do by watching a stream. The core experience with TV and film on the other hand is watching the content.

Nintendo should cut the creators program completely and let content creators stream Nintendo games without worrying about copyright infringement. Not only will Nintendo’s reputation improve from this move but they’ll benefit from the free marketing.

What else can Nintendo improve?

amiibo

Recently Amiibo showed just how loved Nintendo characters are but I’d like to see improvements here. Right now Amiibo are selling in their millions and are getting difficult to get hold of but how long can that bubble last? Nintendo need a way to keep the momentum going for years to come and the recently announced Amiibo cards17 and trial games18 should help see to that. Really though, I’d like to see Nintendo offering either full virtual console games or decent discounts on them. The other obvious idea is for a fully fledged Amiibo game in whatever form that might take. Characters could unlock parts of levels or new abilities and obviously a character model to play as in game. I suppose Skylanders is the obvious comparison but Nintendo have so many great ideas I’m sure they could come up with a unique twist.

Although trophies and achievements are loved by some and hated by others I think Nintendo are missing out on a similar system. If fans don’t care about these rewards, simply ignore them but at least allow fans who do like them to have something similar on the Nintendo ecosystem. I believe these reward systems can have value, for a start they lock a lot of people into the ecosystem. Player’s can look at all their trophies for all the games they have played on a system, when it comes to moving across to a rival they’d be losing all of their rewards. Secondly, Nintendo could incentivise collection of rewards by offering something similar to Club Nintendo. If 100% of the achievements are earned in a game the player might unlock a code for a virtual console game for example. Ok, so Nintendo would lose out on a sale here but they’d also be incentivising players to keep playing on their system and keep hold of their games for as long as possible.

Let’s go back to basics with the controllers. It’s all well and good having choice but having a Wii U with a game pad, motion controller and nunchuk as well as a classic controller is just overkill. Not only can this be confusing to new consumers but it also looks like an expensive system when at first glance a potential customer will wonder if they need all of these controllers on day one. 

Conclusion

I actually think Nintendo do get a lot right, they have a great back catalogue of classic franchises and as such they have a very dedicated fanbase. Nobody can deny that Nintendo innovate, who would have thought that motion controls would become so big over one console generation? Love or hate motion controls, there is no denying there was a point when every developer wanted a piece of the action with Sony and Microsoft also developing their own rival technologies.

Nintendo always experience peaks and troughs, going from such a phenomenal console like the SNES to experiencing low sales and a lack of 3rd party support during the N64 and GameCube eras. Nintendo have had huge failures in the form of the Virtual Boy and the Power Glove to huge successes that have changed the industry like the Rumble Pak and Analogue sticks. No doubt that whatever Nintendo does in the future they’ll have a mixture or sheer brilliant ideas and innovative games as well as a few failures along the way.

Nintendo are now playing catch up trying to get used to working with HD visuals a generation later than the competition. They have been late to the online party, having a pretty basic store, limited online multiplayer functionality and a lack of voice chat. Nintendo really do have the potential to rise to glory once again but a change is needed at the company. They really need to move with the times and reassess how they go about creating games and new technology. There is nothing wrong with keeping their core philosophies and inventiveness but they also need to look at what the competition are doing to stay relevant.

  1. http://uk.ign.com/articles/2006/04/27/introducing-nintendo-wii
  2. http://www.nintendo.co.jp/ir/library/historical_data/pdf/consolidated_sales_e1409.pdf
  3. http://www.forbes.com/sites/davidewalt/2011/02/14/sony-playstation2-sales-reach-150-million-units/
  4. https://www.youtube.com/watch?v=4e3qaPg_keg
  5. http://www.standard.co.uk/business/nintendo-boss-admits-wii-u-could-have-had-better-launch-6410045.html
  6. http://thebridge.jp/en/2013/10/nintendo-satoru-iwata-bdash#fn:2
  7. http://arstechnica.com/gaming/2006/11/8239/
  8. http://www.gamesindustry.biz/articles/2012-10-25-iwata-wii-u-will-be-sold-below-cost
  9. http://uk.ign.com/wikis/xbox-one/PS4_vs._Xbox_One_vs._Wii_U_Comparison_Chart
  10. http://www.eurogamer.net/articles/2013-01-16-nintendo-plans-to-merge-handheld-and-console-teams-in-historic-shake-up
  11. http://blog.eu.playstation.com/2014/04/14/dead-nation-arrives-ps-vita-week/
  12. http://mariovsdk.nintendo.com/
  13. http://www.eurogamer.net/articles/2015-02-05-nintendo-clarifies-youtube-revenue-share-program-asks-users-to-delete-non-nintendo-videos
  14. https://r.ncp.nintendo.net/guide//
  15. https://www.youtube.com/watch?v=CHlBzxc3P6A#t=319
  16. http://www.theguardian.com/technology/2015/feb/02/youtube-pewdiepie-nintendo-revenue-sharing
  17. http://www.nintendo.co.jp/ir/en/library/events/141030qa/index.html
  18. http://uk.ign.com/articles/2015/02/17/amiibo-to-unlock-nessnes-virtual-console-trials-soon
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