Posted by: seanmalstrom | January 8, 2014

The Crisis of Iwata

One thing we do have a large amount of data on is the Wii U. A year’s worth of data is more than enough to define the generation for a console. In fact, a console’s reputation will be set in stone within that first year. No matter what the console company tries, it will be unable to shake that reputation. For example, the Gamecube got the reputation as the ‘kiddy console’ despite Resident Evil 4 and other ‘mature’ games coming out for it later in its life-cycle. Xbox 360 got the reputation of ‘hardcore gamer’ which was an obstacle for ‘family friendly marketing’ Microsoft tried to push later in its life-cycle.

After one year, the Wii U has the reputation of a loser. It will never shake off this reputation even if the Wii U somehow magically outsells the PS4 and Xbone. This is the cruel nature of reputations in game consoles.

Iwata must in a crisis. The reason why is that late in the Gamecube’s lifecycle, Iwata came up with reasons why Nintendo was failing with the N64 and Gamecube. Certainly, Iwata saw these reasons as the key to Wii’s success. With the Wii U failing, Iwata is in crisis.

These reasons are Iwata’s sacred cows. Let’s go through them.

A console being early gets third party developers getting used to working for it and not the competitors.

Iwata’s reasoning for this was that the N64 and Gamecube were both late. He surmised that most third parties got used to making games for the PlayStation and just used that as the standard. Nintendo intentionally targeted the Wii to release at the same time as the PS3. Since there was much more third party interaction than before, Iwata thought this sacred cow was correct. In Generation 7, Xbox 360 was the console that was one year ahead of the PS3 and Wii. Iwata is probably thinking that if Xbox 360 launched with PS3 and Wii, that the standard of third party software would have been Wii. Using Iwata-logic, the one year advance the Wii U had over Xbone and PS4 would mean the default of third party software would be Wii U.

This certainly is not the case. This sacred cow of Iwata’s is being gorged hard.

Nintendo’s likely response…

Nintendo may now wait to release a console until its pipeline of first party software is ready. The ‘releasing early’ is only damaging the first party software output which largely hurts the momentum of the console. I would prefer Nintendo wait to release a console until it has software ready. Nintendo Land and NSMB U were rush jobs, and it showed.

Backwards compatibility removes the risk of transition between console generations.

Nintendo’s handheld line has always been backwards compatible. There was no problems with the transitions between generations of Nintendo handhelds. Nintendo home consoles, however, have had no backwards compatibility. If the SNES was backwards compatible with NES games, would the SNES have sold better? Would the N64 have sold better if it could play SNES games? Could the Gamecube sell more if it played N64 games? To the contrary, PlayStation 2 was backwards compatible and sold a gazillion. PlayStation 3 removed its backwards compatibility and went on to perform less than stellar results. This sacred cow seemed to be true as the Wii had backwards compatibility and sold like hotcakes.

Iwata is looking at the market and seeing Wii U, which has backwards compatibility with the Wii including Wii’s digital games, not sell while the Xbone and PS4, which do not have backwards compatibility, sell very well. He will conclude that backwards compatibility doesn’t matter.

Nintendo’s likely response…

There likely will be no more backwards compatibility in future Nintendo home consoles. It just costs extra money. Nintendo is cheap. The ONLY reason why they were paying for the backwards compatibility is for better transition experience. Wii has a massive game library. Any console would love to be backwards compatible with that library. Despite it, the Wii U is not being bought. Iwata will conclude backwards compatibility has little value.

What I expect is Nintendo to drop hardware backwards compatibility, I want them to keep digital backwards compatibility and suck the consumer into a rich eco-system of virtual console and indie games. This, however, would require an account system. It is also something Sony and Microsoft are unwilling to do. Apple, however, is willing to allow it. There is an opportunity here.

There must be a Mario game at launch.

N64 had a strong launch due to Mario 64. Gamecube had Luigi’s Mansion which was not a Mario game. DS had Mario 64 DS which resulted in the DS being a strong launch. Then there are the past systems like Super Mario World with SNES or Super Mario Land with Gameboy. Iwata concluded that a Mario game is necessary for a strong launch.

NSMB U didn’t give the Wii U a strong launch (or did it? I’m on the side saying that it did. I think it was the only software driving hardware sales up until November for Wii U. It’s the other software that wasn’t doing its job). I imagine Nintendo didn’t mind seeing NSMB U not bringing in huge amounts of gamers so they could count on 3d Mario on finally destroying 2d Mario forever. However, 3d World isn’t selling the hardware.

Mario is no longer selling the hardware. This is a very scary thing if you happened to be a Satoru Iwata.

Nintendo Land can also be considered to be a Mario game as Mario was in several of the games. The point is that Nintendo IPs are not selling the hardware.

Nintendo’s likely response…

There will be a complete reevaluation of the Mario franchise. My conclusion is that NSMB U is a terrible 2d Mario and 3d World is, you know, just more 3d Mario which people are never really excited for. It isn’t because Mario games don’t sell, it is only well made Mario games that sell. NSMB U wasn’t well made. I remember when Super Mario Brothers 1, 2, 3, and 4 came out. NSMB Wii got a pass because we hadn’t seen a 2d Mario on console in 16 years plus it was many people’s first 2d Mario. NSMB U is a lazy ass sequel and is more like the Japanese version of Super Mario Brothers 2. The game seems completely uninspired with no ambition. It’s like Nintendo doesn’t want to make the game.

I have no idea what Nintendo will conclude about NSMB U’s performance. Since they despise 2d Mario, they’ll want it to fail. What is killing Nintendo is 3d World not selling hardware. Nintendo might actually be ready to bite the bullet that 3d Mario NEVER performs.

Nintendo may likely launch the next console with Zelda as they did with Wii.

Numbered and acronym brands only create confusion.

The Wii brand was designed to not have numbers in it or be an acronym. The PS4 has acronyms and a number in it. And there is no brand more confusing than the Xbox One which is a number that goes backwards. Iwata has to conclude that this sacred cow has gone and died.

Nintendo’s likely response…

While I don’t expect Nintendo to make more brands with numbers and acronyms, I think they will conclude that people don’t care what the hardware is named. After all, the hardware always takes a second seat to the software. The market’s response will be seen not so much as responding to hardware but the overall direction to where that console company is going. While it is still a little too early to say about the Xbox One and PS4, it is clear that the market does not like Nintendo’s direction with the Wii U (and even 3DS).

I would point out that ‘flight from Nintendo’ started midway with the Wii starting around the release of Wii Music. Everyone began flying away from Nintendo because they despised their change in direction from their original Wii one. Midway through Wii’s lifecycle, Nintendo was getting arrogant and putting out terrible software. Metroid Other M anybody? Skyward Sword? There was also software droughts! Nintendo was driving Wii customers away with their later software droughts. No one trusts Nintendo today. Not even I.

This is only a small list I have at the moment. I will come up with more later. If the reader happens to know of one, do email it to me.



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