Mr eel
Nintendo Needs a Revolution *yawn*
This particular article from The Motley Fool has been doing the rounds on a couple of games blogs. It’s an examination of Nintendo’s current position in the market and it suggests that in order for the company to survive ‘the company absolutely must regain its console dominance of yesteryear with the upcoming Revolution system’.
By dominance I guess they mean selling the most consoles and having the most games released for the platform, as Sony has in the last round of consoles.
Their main argument centers on the fact that Nintendo has had a 21% decline in profits compared to the same period last year (April to September), which is a pretty significant drop. Nintendo have put this down to dropping sales of Gamecube — to be expected since it is nearing it’s end of life — and higher costs due to investment in Revolution development.
These seem like quite reasonable explanations to me and don’t portend a collapse of the company. Even with a decline in profits, they still make more selling games than say… Microsoft, who have reported billion dollar losses in their Xbox dept.
Bluntly the Revolution is not an all or nothing proposition. Even if it were to remain in third-place, Nintendo still has their other properties — DS, GBA, Pokémon — that would make up for any shortfall from the Revolution. This do-or-die stuff is bullshit.
Aside from that, the article also misinterprets Nintendo’s approach to the current market. I’ve highlighted a few particular statements that I thought were erroneous.
“At this point, I don’t think the key to success lies in the Revolution specs or its snazzy controller. I believe Nintendo will have to market its way out of its demise. I’m not saying that innovation isn’t important. But no matter how good the product is, consumers need to feel a sense of magic associated with the Nintendo brand to overcome the image of sheer power surrounding the PlayStation and Xbox systems.”
I don’t entirely disagree with this statement. The big N does indeed have a problem with it’s image, being perceived as a kids game company. But, discounting the controller is foolish. It fits into their current approach, which is to make games more attractive to people who otherwise don’t bother with them. In that sense it has everything to do with the marketing.
“Nintendo needs convince young, jaded hardcore gamers that its generally sunnier, cartoonier games can be just as cool as the criminal hijinks of Grand Theft Auto.”
Actually that is not what they need to do at all. It certainly is nice to appeal to that audience, but they aren’t the only ones who could be playing Nintendo’s games. If they were to rely on marketing purely to the existing hard-core players, it’s unlikely they they could compete with Microsoft or Sony.
“In my opinion, investors seeking to profit from the console wars should forget Sony or Nintendo — even if the latter does step things up — in favor of Microsoft. It not only offers the Xbox 360 business, but also the Windows operating-system monopoly and a ton of future dividend payments.”
Ha ha ha! I’ve got a better idea, how about you look for profits in companies that make profits? Nintendo, Sony and Microsoft all make profits. Microsoft might be a good investment, but it’s not because of the Xbox. Their monopoly really helps.
Simply this article is very shallow. It’s the sort of assessment I would expect from a fan-boy, who only sees the market in terms of who has the best marketing, sells the most games and is well… the coolest. The business side is actually a little more complex than that and I think this article has missed that point entirely.
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