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Nintendo says: Cinematic graphics, richer storylines, online play NOT the answer

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Old 12-10-03, 09:31 AM
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Nintendo says: Cinematic graphics, richer storylines, online play NOT the answer

I found a link to this article on the IGN. Here's the whole article form Time Magazine Asia

Nintendo Time Asia story

The Console Wars: Game On

Nintendo once ruled video games. No more. Can the Mario maker reach the next level?
BY JIM FREDERICK | TOKYO

Christmas is supposed to be a happy—and wildly profitable—time, at least if you're Satoru Iwata, CEO of Nintendo, one of the world's leading makers of video games. And during the '80s and '90s, it was a joyous holiday. For most of that time, the Kyoto-based game company could count on at least one of every two game consoles gift-wrapped under Christmas trees to have been manufactured by the firm. And each of those game boxes would generate revenue streams that trickled well into the new year, as customers became addicted to Nintendo-owned franchises such as Super Mario and Zelda and bought more titles. In the game business, as Nintendo proved so well for nearly two decades, software is the gift that keeps on giving.

But the company's latest console, the GameCube, has proved to be an unmitigated disaster, giving this holiday season the potential to become the Winter of Iwata's Discontent. Nintendo has suffered such a string of bad news over the past few months and posted such disappointing financial results over the past few quarters that many investors, analysts and industry watchers are wondering whether the onetime industry giant can hit restart—or at least pause—in an increasingly competitive video-game industry. Not only is Nintendo struggling to keep pace with its larger, better-funded rivals—Sony and Microsoft—in the console business, but its Game Boy division, Nintendo's previously unassailable monopoly in handheld games, is suddenly facing a host of formidable foes.

Due to an inventory clogged with millions of unwanted GameCubes, Nintendo had to suspend production on the boxes for the first nine months of this year. Such operations snafus contributed to the company's first half-yearly loss since going public in 1962. Breaking the firm's profitability streak became an embarrassing black eye for Iwata, who had the great misfortune of taking over the company from legendary CEO Hiroshi Yamauchi a year-and-a-half ago—just as the bottom was falling out. Coming off its worst year in history, the company desperately needs a successful Christmas season if it is to regain the confidence of investors, who have pushed its stock down 24% over the past 12 months.

But a rebound looks unlikely. Nintendo, which once commanded more than 70% of the console market, is now struggling just to stay in the game. As of June this year, Sony's PlayStation 2 had captured 74% of the market, leaving Nintendo's GameCube to split the scraps with console newcomer Microsoft and its Xbox at 13% apiece. The next generation of machines—which could allow Nintendo to erase perceptions that the two-year-old GameCube is inferior to the PlayStation and Xbox—is at least a year away. Rather than articulate a radical plan for the company to regain its competitiveness now, Iwata's most notable action since taking the helm has been a series of price cuts, slashing the cost of GameCube consoles by as much as 50% worldwide. While those reductions have boosted market share and promise to move more units during the crucial holiday weeks, they may well have an adverse effect on Nintendo's profits unless game-software sales rise dramatically too, as hardware is a low-margin (if not loss-making) business even in the best of times.

Sitting in a giant conference room in the company's white, castle-like headquarters, Iwata offers up a series of deeply held yet utterly contrarian beliefs about where this nearly $30 billion industry (which makes it larger than the movie business) is headed. Online video games have been a false start so far, Iwata asserts, which is why he has no plans to lead Nintendo in that direction. The current path taken by game developers toward more cinematic graphics, richer story lines and complicated controls is a blind alley that, he says, will only worsen the current "nothing's new" ennui felt by many consumers.

What people want, Iwata says, are simpler, more accessible games that are easier to play and solve—think thumb candy for dummies. Acknowledging that he cannot hope to win a technological arms race against deep-pocketed Sony and Microsoft, he says that his company's salvation is its in-house creative team and the firm's ability to launch groundbreaking games that spawn blockbuster franchises such as the hugely popular Mario Brothers and Zelda series. "Nintendo's basic strategy is to do things differently," he says. "The key lies in developing games that customers have never come across."

Yet, for a company whose executives claim a Disney-like imaginative edge as its most important asset, the place seems to be suffering from game-development gridlock. Not even Shigeru Miyamoto, Nintendo's legendary creative director and gaming deity—Miyamoto created Mario and Zelda—has been able to break the slump. Miyamoto's latest attempt to launch a revolutionary franchise was a bizarre entry called Pikmin, in which users play an astronaut stranded on a remote planet who must enlist the aid of the local aliens (who look like ambulatory onion sprouts) to rebuild his ship—all set to a country-and-western music soundtrack. Pikmin failed to take off, forcing Nintendo to rely heavily on recycled fare such as Donkey Kong, Zelda, and Pikachu and all his Pokémon friends. When asked about original games and concepts—and potential new growth drivers—that are in the works, Iwata hesitates. "Verbalizing a concept that is entirely new is very difficult," he says. "We hope to rediscover what has been lost between the introduction of video games and now." Earlier in the day, the company had demonstrated one such initiative: a game that connects Game Boy handhelds to the GameCube console, allowing for multi-player action without annoying split screens. The fact that the program itself was an update of Pac-Man (which debuted in 1980), however, tended to undercut the message that this was a particularly thrilling innovation.

Nintendo's slide can be traced back to 1990, when plans for a game-platform joint venture with Sony broke down and the consumer-electronics giant decided to build its own machine. At that time, Nintendo made the Cadillac of consoles—but in coming years a challenge was fielded by the Sega Genesis, which for a time became the No. 1 machine on the market. (Sega abandoned the hardware business in 2001.) Failing to strike an agreement with Sony proved to be fateful, because as that company's PlayStation become more popular, Nintendo made a series of what analysts say were strategic mistakes. Sony, for example, opted to allow its game software to be written on standard storage devices like CDs and, later, DVDs; Nintendo insisted on using its own cartridges for the Nintendo 64, which increased development costs for independent gamemakers (the company belatedly switched to mini-DVDs when it brought out the GameCube in 2001). Because Nintendo depends far more on its own games for profits than other console makers do (it produces about 60% of its own games, compared with Sony's 20%), the company has historically treated outside game companies more like competitors than partners, requiring them to accept unfavorable licensing deals and demanding a greater editorial say in game content. Alienated by Nintendo's heavy-handed ways, coders took their products to Sony, making the PlayStation the machine of choice for most consumers in part because that's where the hit games were.

Perhaps more devastating was Nintendo's initial reluctance to market itself to older teenagers and adults, sticking too long to the low-growth market for kids under 14. Sony identified adult gamers as one of its key markets early on and encouraged game developers to produce titles with sophisticated themes (read: crime and violence, including titles such as Grand Theft Auto 3). While Nintendo still emphasizes the family-friendly nature of its products, it's since brought out more mature games but it is struggling to convince consumers it is anything but a toymaker. At this fall's giant Tokyo Game Show, Konami, one of the largest game producers, introduced 23 PlayStation games—but only three for GameCube. "Our target is high school students and older, not Nintendo's grade school demographics," says Minako Gotoh, an executive at FromSoftware, which currently makes 15 titles for the PlayStation 2 but just two for the GameCube.

At least Iwata can still count on his steady handheld business, right? After all, Nintendo's Game Boy has become practically synonymous with portable gaming—and the bleeping scourge of every family road trip. But all those gaming boys and girls are growing up; Sony hopes to repeat its console success in handhelds by focusing on adult customers. The stakes for Nintendo are high, because Game Boy hardware and software now account for about 60% of the company's annual sales and a similar share of its profits. Sony recently announced plans to enter the handheld market next year with the PlayStation Portable. Meanwhile, other companies, especially mobile-phone makers, are hoping to beat Sony to the punch by converting millions of cell-phone users into game addicts via their handsets. Nokia just debuted its N-Gage phone-plus-games gadget, while many 3G mobile phones available in Japan already rival Game Boy in graphics and playability.

Despite its troubles, no one is seriously suggesting that Nintendo is going to be squeezed out of the hardware business almost overnight, as Sega was. Nintendo is sitting on $6 billion in cash and carries no debt, which could provide a war chest with which to outsource a competitive next-generation hardware system. The threats to its Game Boy monopoly are, at this point, hypothetical; and it does have a core excellence in producing seductive software, which makes it (still) one of the largest game publishers in the world.

The key question among analysts is whether Nintendo—a company that is almost proudly antitechnology—can compete against Microsoft and Sony at a time when the industry is poised for a major transformation. Digital devices of all shapes and sizes—such as entertainment-enabled personal computers that can link up with a TV and stereo; and Web-surfing, TiVo-style video recorders—will over the next several years invade the living room. Microsoft and Sony are already selling game machines capable of connecting to the Internet, anticipating the shift to multipurpose entertainment devices. And Nintendo? Iwata recently declared that the company is already working on a revolutionary new hardware unit, but says he won't divulge any details until next spring.

According to many experts, Nintendo's most likely route is to eventually follow Sega's lead: get out of the brutally competitive console business and focus on software. By doing this Nintendo's growth might become limited, but the company could become a profitable boutique video-game brand that caters to children, newcomers and enthusiasts. In fact, game analyst Hisakazu Hirabayashi insists that scenario has already happened. "Since around 2000, Nintendo was no longer a member of the video-game industry. Its philosophy and method are fundamentally different from the other console and software companies. It's not a loser only because it's taken itself out of the race." Every kid who's booted up Super Mario for the first time knows what happens when you run out of lives and can't secure enough gold coins: game over.

With reporting by Toko Sekiguchi
Really, what is this guy smoking???

He says the key is doing things "differently", but in reality they aren't. They are still trotting out the same character driven games they were in the 1980's and 90's. That's not enough anymore.

Nintendo is at some point going to have to get it's hands dirty. It's no secret they don't want to deal with games like Manhunt or GTA3. But for it's own survival, they won't have any choice but to have soon.

Last edited by Captain Harlock; 12-10-03 at 09:35 AM.
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Old 12-10-03, 09:54 AM
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I agree with points 1 and 2 with all of my heart.

I have found online gaming to be pretty fun on the other hand.
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Old 12-10-03, 10:01 AM
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I for one have completely loved and been satisfied with my gamecube so far.

I've owned over 25 games, replay alot of them and my friends have been able to trade too.

This Christmas my buddy in CA are getting broadband adapters so that we can start using WarpPipe to play Mario Kart online.

I'm not one for online game play, but I'll give it a crack.

I hope NES's next console comes out. I'd get it on launch day and play it all the time.
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Old 12-10-03, 10:23 AM
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News flash: Selling primarily to an audience under 16 is a smaller business opportunity than selling to the full spectrum.

- David Stein
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Old 12-10-03, 10:37 AM
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Originally posted by sfsdfd
News flash: Selling primarily to an audience under 16 is a smaller business opportunity than selling to the full spectrum.

- David Stein
Double News Flash: Games primarily aimed to an audience over 16 usually suck donkey nuts.
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Old 12-10-03, 10:41 AM
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Originally posted by PixyJunket
Double News Flash: Games primarily aimed to an audience over 16 usually suck donkey nuts.
How many games are really aimed at this audience? Stuff like GTA is clearly aimed at the adolescent mindset.
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Old 12-10-03, 10:49 AM
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Originally posted by Groucho
How many games are really aimed at this audience? Stuff like GTA is clearly aimed at the adolescent mindset.
Hmm.. good point, good point indeed..

Eternal Darkness maybe?

OH WAIT THAT'S A NINTENDO GAME!!
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Old 12-10-03, 11:02 AM
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it would be nice if nintendo could come up with a good franchise that was not around in the SNES or NES days. I love Mario and Zelda etc.... but they need to get some new series soon




I also think that online gaming will be a huge part of the next generation systems and nintendo is making a major mistake by ignoring it.

I do love my GameCube but I dont think nintendo is going to one of the top 2 hardware makers again.
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Old 12-10-03, 11:06 AM
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Originally posted by bluntman72
I also think that online gaming will be a huge part of the next generation systems and nintendo is making a major mistake by ignoring it.
Believe me, Nintendo will be fully online in the Next Generation.
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Old 12-10-03, 11:10 AM
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Originally posted by bluntman72
it would be nice if nintendo could come up with a good franchise that was not around in the SNES or NES days. I love Mario and Zelda etc.... but they need to get some new series soon
*cough*Animal Crossing*cough*Pokemon*cough*Harvest Moon*cough*

Ok, I'd planned on making a bigger point by listing more franchises, but I can't really think of any others...
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Old 12-10-03, 11:25 AM
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Originally posted by ben12
*cough*Animal Crossing*cough*Pokemon*cough*Harvest Moon*cough*

Ok, I'd planned on making a bigger point by listing more franchises, but I can't really think of any others...

I think he means something that's not in that kind of "cutsey" vien. I haven't heard of Harvest Moon until you mentioned it so I can't really comment about that.

Nintendo needs a huge, monster, unstoppable, "Beatlemania" type of hit to make people stand up and take notice. I have no idea where that's going to come from.
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Old 12-10-03, 11:49 AM
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The irony of all this is that a game like Animal Crossing is infinitely more adult than Grand Theft Auto.
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Old 12-10-03, 12:05 PM
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Originally posted by illennium
The irony of all this is that a game like Animal Crossing is infinitely more adult than Grand Theft Auto.
This I find hard to believe. From a game environment point of view GTA looks like any big city. The automobile traffic is realistic in GTA. Now let's look at the plot: The goal is to up your status in a criminal underworld.

I unfortanately am one of those individuals who if I see a game have cutesy graphics I will usually ignore that game. This is the case with Animal Crossing. So I am asking can you be more detailed with your statement?!?!?
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Old 12-10-03, 12:30 PM
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Originally posted by illennium
The irony of all this is that a game like Animal Crossing is infinitely more adult than Grand Theft Auto.
True dat.

lol, I don't think the Gamecube is as far behind to be an "unmitigated disaster" as the guy says it is. It would have to be as bad as the X-Box is doing in Japan to be a disaster. They had a huge surge this thanksgiving and not as far behind (in fact most news sites are saying they pulled ahead into the number 2 spot). Mario Kart will probably drive nintendo up through Christmas. Harrison admitted that Nintendo was surprised Sony got lucky with multi-functionality (i.e. a dvd player, online play), and they are most definitly working on this for N5.

Pikmin is a nice new game, it is a bit darker than most. There's a sequel coming too . And it looks great! If they keep making good games, I'll keep buying them .
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Old 12-10-03, 12:53 PM
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Originally posted by ben12
*cough*Animal Crossing*cough*Pokemon*cough*Harvest Moon*cough*

Ok, I'd planned on making a bigger point by listing more franchises, but I can't really think of any others...
I remember playing Pokemon on the original gameboy. Also, I believe the first Harvest Moon game was for SNES (I played it on an emulator, but I believe that's correct).
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Old 12-10-03, 01:30 PM
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I will most likely never get into the online play environment on console systems.....I did with my pc years ago and prefer single player games only. I guess time will tell.
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Old 12-10-03, 02:03 PM
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Originally posted by ben12
*cough*Animal Crossing*cough*Pokemon*cough*Harvest Moon*cough*
Harvest Moon is Natsume, not Nintendo.
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Old 12-10-03, 02:04 PM
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The N-Gage is an unmitigated disaster. The Gamecube is not an unmitigated disaster. Suggesting the N-Gage or other cell phone devices that, by the way, can also play games, are serious threats to the Game Boy is idiotic.
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Old 12-10-03, 02:28 PM
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Originally posted by Drexl
Harvest Moon is Natsume, not Nintendo.
Go easy on him, it looks like he has a bad cough.
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Old 12-10-03, 02:53 PM
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He refers to all this competition that the Gameboy is going to face, but I see no competition as of right now. The Ngage would need one hell of a miracle to even make Nintendo blink, and while the PSP has the potential to rival it, it's not exactly on store shelves yet.

The overall hugely negative tone throughout made me question the motives of the writer. The GC hasn't lived up to what Nintendo wanted it to, but I don't think anyone honestly thought it was going to surpass the PS2 this generation. Disaster? I really wouldn't call it a disaster at all.

Yes Nintendo needs more franchise games, but that doesn't mean they personally have to make them. As of right now, I don't see the market for Mario and Zelda games disappearing as long as they don't cheapen the franchises with subpar products. A new "adult" franchise would be good, and I'm hoping a Nintendo second party will step up and provide that. We will just have to see what happens.
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Old 12-10-03, 03:35 PM
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MOD NOTE: Console bashing comment removed. -namja
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Old 12-10-03, 03:47 PM
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It's obviously Clinton loving liberal democrats.
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Old 12-10-03, 04:10 PM
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Nintendo is nearing the end! C'mon, IT IS!

Shigeru Miyamoto, was great in the 80's early 90's...but his magic has stopped. I still get a laugh out of the stupid comments he has conversed during the N64 days, "were not in the movie industry, why use CD's?" MORON! And his views with online gaming are sad! Let Shigeru Miyamoto stay in his Mario/Zelda colorful happy world and lets see Nintendo get aggressive! My damn gamecube is only a ornament on my A/V rack! Pretty purple I would have loved to play Mario Karts! But NO online!?!? You're not going to get my $50! I blame a lot of Nintendo’s failure on Miyamoto leadership!

Also, more franchise games?!?!?! NO! They need 3rd party games! They need a damn control that isn't designed for one game! HAHA It's so true!

Nintendo's ship is taking on water! Targeting sub-teens is a big NO, NO! First, they lack available cash and secondly they don't care for Mario and Zelda anymore. The kids now don't remember Mario or Zelda on NES, nor SNES. It’s qualitivly proven that Nintendo’s scope is NOT working. Cute colorful games don’t sell systems. Over supply of machines during Christmas!?!?!

I’m glad to see Nintendo in the red! Now they need to get there acts together, have a company shake down and change the company scope! That’s not saying drop the colorful games, but get a better mix! Target the 18+ group! Nintendo claims to be a family machine, but they tailor to the kiddies!

Nintendo next system needs to have 3rd party support, use regular size DVD’s and have FRIGGIN” ONLINE gameplay!

What would be cool is to have Nintendo games on my XBOX2 in the future
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Old 12-10-03, 04:19 PM
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Originally posted by PixyJunket
Hmm.. good point, good point indeed..

Eternal Darkness maybe?

OH WAIT THAT'S A NINTENDO GAME!!
OH WAIT THAT'S ONE GAME. So Nintendo does target the 18+ age group. My bad.
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Old 12-10-03, 04:19 PM
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I love this forum: "No console bashing"*

*anti-nintendo rants excepted

Please, name some games that caters to the 18+ age range.
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