Nintendo: Apple's Latest Prey

I am neither the best analyst nor do I have any information. But I am going to comment on this mainly because, having owned almost everything they released and because I have a lot of great memories from its games, I am really emotional about Nintendo.

They have been in the industry for almost 40 years: started distributing Magnavox in 1974, made huge success with Donkey Kong arcade in 1981 and released their first consoles in the beginning of the same decade (Game Watch and Famicom-NES).

No company has made it that far, no company has been so innovative and no company has had the lows of Ninty (Sony is probably having a bad era with PS3 but that's their first bad release -handhelds excluded- and Microsoft has been doing fantastic with all XBoxes). Furthermore, no company managed to even come close to Nintendo in the handhelds.

As much as I love Apple (and can even consider myself kind of a fanboy) I just can't stand it when they try to involve it everywhere and explain everything as a result of its success.

Nintendo is Nintendo's prey, they dug the hole that they fell into. The 3DS is not selling bad because people are buying Angry Birds instead of Super Mario. It's not selling well because, well, what is there to sell? It's unbelievable that Nintendo released a handheld with such a weak launch-titles line. Tell me one game that will make you want to buy 3DS. You don't buy a console and then wait for games to come out. You want the games there. Unless it's something really major, like the Wii, when you can see its potential and you can do with games like Wii Sports for a while.

But the 3DS is a handheld, I am not going to buy it just to spend 10 minutes on a Piccadilly line ride playing mini games and waiting for a few major games to come out, when they come, with the quality they come out, etc.. I can compare that to playing Doodle Jump and Doodle Jump wins easily. What I can't compare to Doodle Jump is a Zelda/Mario/AAA game on my 3DS.

It's not about Apple vs Nintendo, nobody will buy an iPhone to play video games. And it's not about whether Nintendo can do well as a iOS/Android/WebOS games developer. Of course they can and I hope they do if they get in such a bad position. What it really is about is whether Nintendo can help handheld gaming keep its value.

Also, it's not hard to see that they are going to fall into another hole if they don't do MAJOR things with the WiiU. So I am kind of glad that the 3DS release wasn't successful, I can hope they are getting a few messages..

Nintendo's in an awfully tough spot here. Their success in expanding the market to non-gamers (the "blue ocean strategy") puts them in exactly the wrong place for 2011 where it appears likely that most dedicated gaming systems are going to be owned by the hardcore going forward. Many of their newly-won customers from the last few years now have all the games they could want on systems they already own and those games have average price tags of maybe 20% of what they are on traditional platforms. And they're better connected for social, too.

So Nintendo doesn't have room to make particularly enticing hardware - it'd have to be super-cheap to tear people away from platforms they already own for other reasons but it'd probably have to be super-expensive to be different enough to be exciting.

And, even worse for them, the bottom has completely dropped out of software pricing. It's tough to pay $40 for a 3DS game that I'm likely to play less than something for $2.99 on the App Store. I'd buy Mario and Zelda for it, but that's probably it.

With the very Nintendo "make something cheap but that's so different and so cool that everybody with an iPad would still want it" option off the table, what can they do? Can they survive just selling <$10 games on somebody else's hardware? Maybe a partnership? An Android partnership doesn't seem likely to deliver Nintendo quality in the short term at least and Apple is quite unlikely to partner with them. No other mobile platform seems worth their time.

I do wonder if there's a team working on Zelda for iOS... And another team preparing a massive reorganization. Seems like a terrible option but I don't see what else is going to be available to them. Hope they can find a good way out of it because they're one of the most innovative companies in the world.

My Kids have DS's. But for Christmas, I bought each of them and my wife an iPod touch.

The concept was simple, I spend about $70 more per device, but instead of buying $500 worth of games over the next 2 years, I will probably spend $50. Why buy $35 DS games when the kids are happy with free and $2 iOS games?

Also, Nintendo should have been smarter than to bet on 3D. The theaters can do it to up-charge us for a minimally better experience, but most people could care less if 3D just went away. The fact that Nintendo bought into "3D is the future" feels very 1985 to me.

The DS and DSi are so good, and the kids love them so much, my personal opinion is simply to move in the direction handhelds have been moving already - better graphics and faster processors. The next step is to lower the prices of their games, but I don't see that happening.

Was anyone ever excited about the 3DS, or its pricetag? Think that is more to blame than Apple.

If you were a parent, which would you rather buy?

1. iPod Touch, $229. Most games are $1, but some go up to $5.

2. 3DS, $249. Many games are $40. Even old games are $20.

Even with a price drop, I'm not sure the economics work out for Nintendo.

Apple has huge stashes of cash. I keep wondering when they'll do something, like purchasing Nintendo. So far, all of their purchases have seemed pretty minor.

I think most iOS games are low quality. Even when they are extremely polished, they lack depth. Having brand new mario and zelda games on the platforms would reverse this.

Beyond that, from the little bit that I know about Nintendo's next console platform, it sounds basically exactly like Apple TV plus an iPad.

Beyond that, Apple also has a really strong platform for distributing software over the air to non-desktop/laptop devices. I think Apple is in a better position for next-gen gaming. I don't know if the next Nintendo console is going to have games that are distributed via physical media, but if they do, I wont be buying one. At this point, having to go out and buy a game, and getting up to switch games, are big negatives.

I'm not sure if nintendo has enough experience to do this right. It looks like 3ds games are still sent via physical media, not over the net. Besides that, using the Wii for watching Netflix nightly leaves me with the distinct impression that the Wii was designed with internet usage almost as an afterthought, certainly not as a core function of the device. Which is fine, but even basic functionality improvements haven't happened. Every time you switch networks on the wii, it asks you to perform a system update, which takes 5+ minutes to check to see if your system needs updated. Which seems insane to me for something that amounts to sending a hash of app_ids -> versions.

Additionally, Apple tries to remain very family-friendly, which is a market that Nintendo dominates in the traditional gaming market.

It certainly seems like a smart move.

For all that has been said about gaming on the iPod/Android, the state of the art in games there is still pretty low-rent, low-budget.

I mean, what's the big hit? Angry Birds, which looks like it was written by one guy in two weeks. Sure, people enjoy playing it, but it strikes me that the market for big fancy games is still not served on these devices.

There's a market in between "casual" and "hardcore". I don't want a game I have to practice for five hundred hours before I stop being a "n00b"... but on the other hand I do want a game that can really hold my attention on a twelve-hour plane ride. Something with a real story, and an adventure, that progresses as I play through it, and where my reward for playing more is something other than "now do the same thing with a more complicated series of boxes".

As a Nintendo customer, their software lineup has become very uncompelling. To the point where my Wii & DS haven't been turned on in over a year+ and there's no reason to buy the 3DS (even with price drop). N64 ports and other remakes aren't appealing.

Nintendo has been complacent riding the gravy train of casual gaming (Wii Sports type minigames, fitness, etc) for great financial success that doesn't constitute epic AAA gaming (core franchises like Zelda, Metroid, etc).

They aren't competing well VS direct competition (Sony, MS). With iOS & Android platforms to contend with, it isn't going to get any easier for Nintendo.

To compete against free & .99 cent app store games, Nintendo needs compelling, epic AAA games at the $30+ price point that they charge for. Not 3rd party shovelware.

I think Nintendo's valuables are not in hardware (anyone can build a hand-held console these days) but in the huge library of very famous games.

If 3DS has lost the game, nothing stops Nintendo from re-releasing some of popular old games for iPhone (perhaps developing a descent emulator for iOS) and keep writing more excellent games in future.

Example: iD made another stash of green from Apple's app store when Carmack released Wolfenstein 3D for iPhone.

Lately when friends ask my advice about which DS, I suggest getting an iPod Touch instead unless they're really dying to have Nintendo property games (Mario). It does more than just games, no cartridges to lose, and the kids will want an iPod soon anyways.

Even the equivalent games are cheaper. LEGO Harry Potter is $4.99 on iOS vs. $14.99-19.99 on the DS. Sims 3 is $6.99 on iOS vs. $27.99 on the DS.