Comment by gryson | Hacker News Reader

Comment by gryson | Hacker News Reader

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For more recently uncovered information about a possible deal between Sony and Sega, read:

https://mdshock.com/2019/03/18/sega-and-sony-new-insight-int...

That article also gives insight into why Kutaragi/Sony wanted to partner with Nintendo.

A quote by Kutaragi:

“I wanted to start up a business that would become a new major income source for the company in the future… [Sony executives] thought it would take too long to start a new business from scratch with venture capital. So the only way to initiate change was from the outside. We could join forces with the best-performing company in the field. We would sell them our technology, establish a track record, and use that as the springboard to future success. That was my reasoning.”

Also, from historian Reiji Asakura:

“Nintendo was concerned that its business would eventually be taken over by Sony if Sony continued to drive product development. Although Nintendo was dominant in the game-machine market, the company was fully aware that Sony had a superior research-and-development operation and thus had the potential to outstrip its competitors in the area of technological advancement.”

References are in the linked article.

Those quotes are interesting. Seems like the prevailing opinion is that Nintendo made a mistake cancelling this deal with Sony because it opened up the door for Sony to become it's largest competitor.

In reality it seems like it was Sony's intention all along to use this as a stepping stone to competing with Nintendo directly anyway.

Yes. The same is said about the Sega-Sony deal, which Sega is often criticized for not following up on. The accounts of former executives make it clear, however, that it was too risky to work with Sony due to their ultimate motives. Sony wanted to dominate the market from the beginning, and they wanted to use established companies as an entry point.

Also, the contract between Nintendo and Sony was signed in 1989, and Sony would have received all royalties from CD-ROM sales. This was at a time when it was still not clear that CD-ROMs would soon dominate the market. However, that had changed by 1991 when the Nintendo Play Station was revealed.

Then-president of Sony, Norio Ohga, said the following in his autobiography: “What we learned later was that Yamauchi’s son-in-law, then the head of Nintendo’s U.S. operations, had apparently nixed the deal. The son-in-law, Minoru Arakawa, had witnessed firsthand the stunning growth in U.S. sales of CD-ROM drives and disks. Arakawa knew that Sony had built a strong position in CD-ROM products. And he apparently feared that Sony would get the better of Nintendo in a collaboration.”

Also, I'd say that "Sony's generally better at the tech" has basically come true. But Nintendo adapted into its current position, which is a pretty nice position to be in. Had they taken the deal, it's possible they could have gotten complacent and gotten sidetracked away from focusing on game quality.

The focus of Nintendo on gaming and not technology is even larger that it seems, because the hardware and software engineering of at least Wii and WiiU (and probably even of GameCube and Switch) was almost completely outsourced.

Indeed, they always had that Intelligent Systems Co. within their HQ campus, as if engineering jobs needs to be “elsewhere”.

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