This was predicted by Iwata and Nintendo back in 2005. The purpose of the Wii (and DS) was to counter the decline.
It was successful. But only for a little while. Disinterest is fighting back.
“But Malstrom!” says the happy go-lucky reader. “Microsoft says Kinect is growing the market…”
“But Malstrom!” say another plucky reader, “Sony says the Move will steal the Wii audience…”
The numbers are in, and they show the gaming market has returned to 2006 levels. There is no way to spin this. Kinect is a failure. Move is a failure. And ultimately, Nintendo is failing in its crusade to conquer the Forces of Disinterest.
Let’s look at the top ten for a moment…
Software (New Physical Retail only; across all platforms incl. PC)
01. L.A. Noire (360, PS3) Take 2 Interactive – 899K
02. Brink (360, PS3, PC) Bethesda Softworks – 401K [360/PS3 Only]
03. Lego Pirates of the Caribbean: The Video Game (Wii, 360, NDS, PS3, 3DS, PSP, PC) Disney Interactive Studios
04. Portal 2 (360, PS3, PC) Electronic Arts
05. Mortal Kombat 2011 (PS3, 360) Warner Bros. Interactive – 292K
06. Call of Duty: Black Ops (360, PS3, Wii, NDS, PC) Activision Blizzard
07. Zumba Fitness: Join the Party (Wii, 360, PS3) Majesco
08. NBA 2K11 (360, PS3, Wii, PS2, PSP, PC) Take 2 Interactive
09. Just Dance 2 (Wii) Ubisoft
10. Lego Star Wars III: The Clone Wars (Wii, NDS, 360, PS3, 3DS, PSP, PC) Lucasarts
The top ten are the usual suspects. The newly released games are on the top being front loaded. The current kid-craze series of Lego Star Wars games are selling very well (and on Xbox 360 which should scare Nintendo more than anything. Microsoft is making inroads into the kid’s market, i.e. the traditional Gamecube territory). Just Dance 2, Call of Duty, and Fitness games are all there. But do you see that, reader? Look very carefully.
Mortal Kombat is still selling strongly.
“But it has always sold strongly.” I don’t think so. There is something quite interesting with this Mortal Kombat in that it has gone back to its Old School roots. In other words, the game is competing against Mortal Kombat 1, 2, and 3, the games that actually made the Mortal Kombat franchise. And gamers are loving it.
The Wii price drop plus including Mario Kart Wii hasn’t helped the Wii’s performance. However, the hyperbole of the Wii’s demise is a tad overstated.
Anyone saying the Xbox 360 or PlayStation 3′s numbers are ‘good’ are someone who doesn’t know what they’re talking about (or getting paid intentionally to spin them). The HD Twins are overall flat. This is why the ‘growth’ is being reported only in percentages and not actual numbers. Percentages give an illusion of growth. But to be clear, there is absolutely nothing going on with the HD Twins. They are just… there.
The most interesting information is that PSP sales have gone up (since last year). What does that mean? It probably means nothing. But hey, if reckless media outlets or forum dwellers are going to declare that Xbox 360 or PS3 sales going up, since a year ago, is ‘super amazing’, then to be consistent they must include the PSP. And we know that there is absolutely nothing going on in PSP Land. If PSP got a sales increase by doing nothing, perhaps it is for the same reason why the HD Twins got a “sales increase”. Of course, this “sales increase” is still ‘flat’ (which is why percentages are used to hide the flatness).
I want to know what the DS sales numbers are. In Japan, DS sales have remained constant at 10,000 weekly. This is considerable since it is 10,000 not going to the 30,000-ish 3DS or PSP.
Anyone who says that 97k 3DS sales is ‘OK’ or ‘normal’ because of some ‘excuse’ forfeits their right to participate in console sales discussions. The 3DS defenders are sounding like this…
Above: “Leave Nintendo alone!”
We’re going to shoot down these excuses for 3DS market performance I keep seeing…
Excuse One: The Price
The price isn’t the issue. The issue is the value. When something “feels” expensive, it is because the price and value are out of sync. Overpriced things have their price much higher than the actual value of the product. Nintendo knows it must raise the value, not lower the price. Lowering the price now would reinforce the low value 3DS has.
And what is the value of the 3DS? It can be 3d and nothing but 3d. The brand is 3d. All the costs of the 3DS revolve around 3D. The system and games are marketed for their 3D. The problem with the 3DS is not the price but that 3d has little to no value to consumers.
A much better path for Nintendo to take would be to release a revision without the 3d capabilities but keep everything else the same. You could call it the SDS (Super DS). Declare 3DS a third pillar and quietly let it die to have SDS save the remains of Nintendo’s handheld market.
Another common thing is that people say the 3DS label makes people think it is an iteration of the DS instead of the next generation of handhelds. “If they only marketed better, had a better brand, this confusion would not exist,” says the valiant 3DS defender.
But this problem is also that of value. Super Nintendo never confused people from ‘Nintendo’ (what we called the NES). Gameboy Advance didn’t confuse people from Gameboy or Gameboy Color. Xbox 360 didn’t confuse anyone from Xbox.
Wii U will also likely have this problem, but it will not be marketing. It will be due to people not finding value in the new console.
I believe 3DS marketing is successful. I believe Nintendo is getting its message out. The problem is that the market doesn’t like the product. The market does not like 3d. The market does not like the direction Nintendo is going.
Gamers are very savvy people. Give them more credit. They know the 3DS is a new generation of a handheld.
Excuse Two: No Games
It has only been a couple of months, but there is already big software out. Nintendogs, one of the best selling DS games or video games ever made, is out. You have strong third party support such as Street Fighter IV. (And yes, Street Fighter is a system seller and has been since the SNES port of Street Fighter 2.) You have Pilotwings Resort. You have Steel Diver. You even have games that come installed with the 3DS!
What did the DS have? A port of Mario 64. And everything else was garbage. 3DS has a much better software line-up. It was that same exact line-up these excuse-makers were ooing and ahhing about at E3 2010.
Excuse Three: Cellphone games are killing the home portable
Then why did PSP sales go up this month? Why did DS sales continue just merrily fine throughout the rise of the smartphone and earlier cellphone gaming? People forget that cellphone gaming is nothing new and has been around for nearly a decade now.
Excuse Four: DS Started Slow Too
The early DS performance is an example of a bad strategy, not an example of the norm of how the handheld market works. Everyone who points to the DS early performance never explains how DS got out of that slump except for ‘more games’. Sorry, saying ‘more games’ isn’t going to cut it. PSP got ‘more games’ too but that didn’t save it.
DS didn’t just get ‘more games’, it got ‘the right games’. And what are the ‘right games’? You had…
NSMB (a far contrast from Mario 64)
Mario Kart DS (retooled to use SNES-esque fundamentals)
Final Fantasy III (don’t forget this game sold out at launch in Japan, right before the DS exploded)
All those games were epitome of the Old School. Then you have other games that looked to the outside world for the source of the gameplay.
Nintendogs (whose sequel is already released on the 3DS)
Brain Age (which was the video game version of those brain games. It also had Soduku!)
Animal Crossing DS (run around and pay off your mortgage).
Out of all of these, only Animal Crossing can be considered a ‘Gamecube’ type game. But Animal Crossing only really sold in Japan and, even then, to young girls. Everyone agrees Animal Crossing fit the handheld better than the home console. So perhaps it was never really a N64/Gamecube-esque game despite its origins.
My point is that the N64/Gamecube philosophy for gaming doesn’t work. It didn’t work for the N64 or Gamecube. The reason why the DS was in trouble was because it was attempting to replicate the N64. It had Mario 64 DS at launch. It was imitating 3d on a portable. People called the DS as a portable N64. This is how people perceived it.
When the DS Lite came out, a totally different strategy and perception had set in. People saw the DS as a portable SNES. Every N64/Gamecube-esque game performed poorly on the system. Mario 64 DS didn’t move systems. Metroid Prime Hunters, while interesting, didn’t do too well. Every game that tried to go N64/Gamecube, i.e. ‘New School’, died on the DS.
The reason why 3DS will not get out of its slump like the DS did (not just sell slightly better, but rocket up) is because 3DS is married to the Gamecube philosophy. There is no Old School on the 3DS.
Excuse Five: The upcoming games will save the 3DS
No, no, no. If it smells like a Gamecube game, it will not sell.
Super Mario 3DS- If Mario Galaxy couldn’t push hardware, why would a 3d Mario on a handheld?
Ocarina of Time 3DS- If Ocarina of Time couldn’t sell the N64, why would it sell the 3DS? Mario 64 couldn’t even sell the DS. And Mario has way more pull than Zelda ever did.
Starfox 64- Much weaker game than Ocarina of Time. This game will be sent out to die. It will make no difference.
Luigi’s Mansion 2- First one didn’t sell the Gamecube. Why would it suddenly sell the 3DS?
Mario Kart 3DS- This is a big question. It depends on whether this is a SNES-esque Mario Kart like the GBA, DS and Wii versions or a N64/Gamecube-esque Mario Kart. The problem with the N64/Gamecube versions of Mario Kart is that they were sacrificing the fundamentals of the game to play with ‘new 3d technology’. Judging from seeing karts fly on a kite or swim through water, this is leaning toward the N64/Gamecube direction. But we need to see more to be sure.
Excuse Six: 3DS is OK because it costs more and is matching earlier DS performance.
3DS has no competition. DS had the PSP as competition. And the PSP was cleaning DS’s clock early on.
Excuse Seven: Time will be kind to the 3DS sales
In the immediate year, yes. But not longer. Here is why.
Nintendo prioritizes the hardware they are making games on. When the DS came out, Nintendo focused on making DS software to drive the DS install base. When the Wii was nearing release, Nintendo switched to Wii games to drive that install base. This see-saw of home and portable game priority depends on the install base that needs to be driven.
Right now, that would be the 3DS. E3 2011 is actually more about the 3DS. Nintendo games will be 3DS.
Here is the rub. The Wii U is coming out sooner than it should (early to mid 2012). I guarantee you, the Wii U must have games released on it. So what you are seeing with 3DS software at E3 2011 is basically all you are ever going to get from Nintendo. Sure, I expect Animal Crossing to show up next E3 and perhaps another game. But E3 2012, Nintendo will be showing off Wii U games as their development switches to that platform.
If the 3DS hasn’t recovered by that time, it is all up to the third parties. And we know how that will turn out. Third parties will be more attracted to Vita anyway.
Nintendo will stop focusing on making 3DS software very soon to focus on Wii U software. This will end up being bad for the 3DS. If the 3DS does not get out of this ditch within a year, it is highly probable that it never will.
Nintendo will ask itself, “Why didn’t 3DS software succeed?”, and I will tell them, “Because the market rejected your Gamecube direction once, now it is rejecting it again. Stop making Gamecube games and consoles.” This will also be a problem to engulf Wii U as well. But that will be another story…