“The new device [3DS] culminates a generation-long dream of the two men [Iwata and Miyamoto] to bring a 3-D machine to market, pursued through a series of embarrassing flops and abandoned projects.
They waited years for liquid-crystal-display quality to improve and screen prices to come down so they could finally offer 3-D without glasses. They repeatedly sent engineers back to add features. Mr. Iwata rejected more than a dozen 3DS prototypes.
Says Mr. Iwata: “Our bar was set extra high, because we had tried 3-D so many times in the past and it wasn’t successful.” “
*snip*
“The pursuit of a 3-D game system has been something of a personal mission for the two ever since their first joint project involved 3-D in the mid-1980s. Mr. Iwata was then an outsider developing a rally-car racing game for Nintendo’s first attempt at a 3-D game player. Mr. Iwata made the game technically advanced. Mr. Miyamoto made it more fun, by adding racers and making Mario the main character.
Their game was for Nintendo’s Family Computer 3-D System, which required users to buy a special disc player and a pair of 3-D goggles in addition to the standard console. The system never caught on. Eight years later, Nintendo took another stab at 3-D, the Virtual Boy system. Users peered into a goggle-like device to play games displayed in different shades of red against a black backdrop. This one didn’t sell, either. It was gone after about a year.
But Nintendo boss Mr. Yamauchi, now 83, was an advocate of 3-D, and after he brought Mr. Iwata to the company in 2000, Nintendo continued to pursue the technology.”
Read more: http://online.wsj.com/article/SB10001424052748704071304576160041815400126.html#ixzz1Fa5hdLn3
Disruption literature says that the most dangerous time for a company comes with success. It was the huge success of the DS and Wii that has made Nintendo lose much of its critical thinking. Remember when the strange software began appearing with the Wii such as Wii Music? I think that is also a factor. It is like they suddenly began to think they were geniuses and began doing whatever they wanted to do. To those who were around for Wii’s launch, Iwata talked VERY differently. He talked about how to integrate gaming into the consumer’s life and that games were ‘too complicated’ and the need to ‘get back to basics’. This 3d orgy goes against this direction which Iwata has admitted. Investors should be extremely concerned.
During the Wii launch, Yamauchi also wanted Nintendo to get into the movie business. The board began seriously talking about it. The 3d orgy is not just to be a 3d orgy but to also be the foothold for Nintendo to be a platform for movies. Yes, you heard me. Nintendo wishes to be a platform for movies. (I thought they decided against Yamauchi’s idea since nothing came of it. I suppose they were awaiting the next console cycle. Keep in mind that this is still Yamauchi’s company, and it will do whatever he wishes.)
The 3DS is as if Nintendo is adopting Sony’s strategy for handhelds. Like the PSP, the 3DS is supposed to be a platform for movies, to do augmented reality, and to play console quality games. As insane as this sounds, the 3DS is 60% more expensive than the DS, its games are more expensive, but the economic environment surrounding has seriously degraded since 2004. Even if the 3DS becomes as popular as the DS (not probable), it would still sell less due to the higher price tag and the declining economic environments in the markets.
Iwata and Miyamoto have never faced the current economic environment. The biggest market for Nintendo is the United States. It was the United States that saved the N64 and Gamecube from complete oblivion (no other market bought it). The United States has been enjoying an economic expansion since the year 1983 (when the console market crashed). This is a situation Nintendo has not faced before.
If the 3DS does not perform as well as the DS (which I believe is the probable scenario) it does not mean (as the stupid gaming analysts say) that the sales were taken away from smartphones. It would actually be that consumers are disinterested in 3d gaming for their handhelds or are scared of the high price tag.
3DS performance is not going to be illustrative in Japan. Japan is handheld-centric. 3DS cannot fail there. Why? Because the PSP didn’t fail there and the PSP failed everywhere else in the world. It is also going to take months after the launch to really begin gauging interest.