May 15th, 2014, 23:50 Posted By: wraggster
There seems to have been two main reactions to Nintendo’s recent annual loss of $456m. The most prominent is that these huge losses suggest Nintendo’s time is up.
‘Nintendo is over,’ was what one prominent business journalist said on Twitter.
It’s not true. For all its financial miscalculations, Nintendo’s main software brands remain robust. Pokémon X and Y sold 12.26m units alone, making it one of the best-selling boxed products of the year across all platforms, while the Mario franchise sold around 15m games over the last financial year. These numbers alone point to a company that remains popular despite the failure of its latest console.
The other reaction is just as inaccurate: the idea that Nintendo has such deep pockets that it can afford to make these financial losses. No company can afford to report numbers like this, and if it carries on in this way it will run out of its cash reserves within the next five to ten years.
The suggestions on how Nintendo can turn around its business have been numerous, and we’re not about to make any here. Yes, launching a new blockbuster IP or console are probably the best options, but Nintendo’s problems are immediate and you cannot comfortably turn around a new killer product in the modern games industry in 12 months.
The same applies to cutting the price of Wii U. Retailers told MCV last week that Wii U’s price is simply too high, and it’s hard to disagree. But cutting the price is not a certain fix, and with the company hemorrhaging money it would take a brave CEO to take such action. Nintendo’s immediate problem is short-term: How does it turn its current losses into a profit using the tools and hardware it has already developed?
For all its financial miscalculations, Nintendo’sThe platform holder has talked about ramping up the licensing of its big brands and pushing into emerging markets. And we can expect a few more small games, re-releases and remakes to hit the market too. GBA and DS games are being ported to Wii U, and the firm has announced a new Pokémon remake to launch this Q4 on 3DS.
main software brands remain robust. Pokémon
X and Y sold 12.26m units alone, making it one
of the best-selling boxed products of the year
across all platforms, while the Mario franchise
sold around 15m games over the last financial
year. These numbers alone point to a company
that remains popular despite the failure of its
Yet the biggest bet Nintendo appears to be making is by following Skylanders and Disney Infinity into the toys-to-life genre.
The NFC Featured Platform or Nintendo Figurine Platform (NFP) is for both Wii U and 3DS. The latter will require its own piece of hardware, and Nintendo is developing toys and multiple games.
“What is especially unique about NFP is that it is not classed as an accessory product of a certain software title but as a platform itself,” Nintendo CEO Satoru Iwata said in a briefing. “The figurines are going to work with multiple software titles to be released in the future, and we are aiming to develop more software compatible with the figurines.
“Nintendo has a lot of well-known character IP that has originated in video games. This is why I believe a brand-new type of platform will be born when the character IP becomes compatible with NFP. At E3, we will announce which titles are compatible with NFP, display NFP products and disclose specific information about NFP, which will be launched during this year-end sales season.”
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