I get the idea that Nintendo can't just give moneyhats to everyone.  But if the console sells well they won't have to.  Third parties will want to release games on the Wii U.  I think some key moneyhats on big titles that have a strong potential to sell systems would be worthwhile to expand the userbase.  The third party support will follow the expanded userbase and then Nintendo doesn't have to give out moneyhats anymore.  I think Iwata is scared that it will set a precedent and every third party will ask for a handout.  Moneyhats are only necessary when you have no leverage.  Once you've got the sales, you've got the leverage and can play hardball with third parties.  Any third party that got a moneyhat may try to ask for another one later but if the Wii U is selling well are they really going to just ditch the Wii U and piss away all those potential sales?

Nintendo is very reluctant to spend $100 today to make $1000 tomorrow.  The Wii U is not going to sell on first party games simply because Nintendo cannot possibly make enough games in enough time.  They've demonstrated that they are very slow at HD development.  They absolutely need third party games to fill the gaps.  Moneyhats today could be necessary to sell enough systems to get over that initial hump where the userbase is big enough to attract support the "natural" way.

I don't think that third party support is all that is at stake here.  The Wii U is selling poorly enough that I question if it will be viable in the longterm for Nintendo.  I don't think coasting with no real effort for the next five years is even an option.  Plus I can't imagine that Wii U customers would be happy about that and people that are unsatisfied with your current console are reluctant to buy your next one.  That's why I don't have a Wii U.  In the longterm Nintendo can't just offer a lousy product generation after generation and expect their customers to stay loyal.  At some point they have to get their act together and if Iwata is not willing to do that then he needs to decide to pursue other endeavours.

If Nintendo's conservative approach will lead to profit, why are they likely on their way to a third straight year of operating loss?  I also think at some point you have to question Nintendo as a hardware manufacturer. What I mean is Wiifit, Mario, MarioKart all sold > 30 million on the Wii. At 60/game that's 2 billion in revenue a game. And they have other very strong franchises as well. At what point is the Wii U lack of userbase hurt the profits of internally developped software to the point that Nintendo could make more as a third party?

I hate the the all or nothing moneyhats argument. Nintendo needs to spend smartly and not spend themselves into bankruptcy. Other companies figure it out. Also, we need to redefine moneyhats. Moneyhats are often a reduction in licensing fees. This means that Nintendo wouldn't have to use operational cash and there is no real risk of hurting the company financially.

I question Nintendo as a console hardware manufacturer these days. They seem to only halfway-embrace console hardware improvements, and it's at the point where they need to decide if they want to be in the console space or not.  Not going head-to-head with Microsoft and Sony on the hardware front is really kicking them in the ass now.
What if they dropped consoles entirely and threw their weight behind a Nintendo Phone? They're much better at mobile development, and could seriously innovate in that space at a much lower cost.

@Lindy Well certainly next generation Nintendo will not have a console and a handheld. They will have a hybrid. They merged their hardware divisions I believe for this reason. 3 reasons this is possible. 1 handheld power is catching up to console power 2. Its going to be much easier to support one system than two. 3 They essentially already have the beginnings of a handheld console hybrid.

After 3ds's 5 years are up they should just release something called Gameboy. Its already been 10 years since GBA sp, and 8 years since GBA micro. In 2016-2017 mobile processing is going to be pretty crazy. They should definitely make it a phone too.

So are you saying a Wii U GamePad with an HDMI output?
Most games can be played on the go (Off-TV play) while a few need the TV to function properly (Nintendo Land or Zombi U)?
Maybe this is part of the reason Nintendo is trying to steer us away from thinking graphics are everything. I would buy a large portable system with an HDMI output made my Nintendo.
Imagine how often we'd get new games developed by Nintendo (look at all the 3DS releases combined with the Wii U releases) plus imagine going on a trip with your Nintendo handheld console and you get to the Hotel and all of a sudden you plug in an HDMI cable and you have the full console in your hotel room!!! AWESOME!!!

You don't even need an HDMI cable. Bring the power cord and the admittedly tiny console with you, and as long as you have access to a AC power, you can play on the Gamepad. I've started doing this for long car rides.

I partly agree with you Jon, but at the same time I do like the variety Nintendo brings to the table (at least in regards to something like not making people pay for online play). Still, I have to agree...with the Gamepad not being as compelling, it makes all of Nintendo's flaws stand out like a sore thumb. Their control input is supposed to be what makes them stand out. The idea, I suppose, was that the different controls would be enough to offset the graphics technology. When the controller isn't pulling its weight, I just feel like I have a console that, by all other accounts, is inferior to the others.


The games will come out and sell well, but at the end of the day, Nintendo is going to be looking at a situation where their games sell well and no one else cares. If that's the endgame, then yeah, sometimes I wonder what the point of a Nintendo console even is.


It used to be the controller, but if that's the case, maybe they need to partner up with someone else who knows what they're doing in all other aspects of console manufacturing.

The console/handheld hybrid is the future for not just Nintendo but really the gaming industry in general.  But realistically such a product would replace the 3DS and Wii U so both systems need to have the same lifespan.  I can see Nintendo pulling the plug on the Wii U prematurely if it's losing money but dropping the 3DS too early would upset their existing userbase.  If the Wii U fails then Nintendo either has to take a hiatus from the console scene for a bit or pull the plug on a popular handheld to replace it early and I can't imagine Nintendo wanting to do either.  They have to at least put the sort of effort into the Wii U where it will make a profit (or at least break even) for the next four years.  Nobody wants a console where it looks like the manufacturer is not even trying.  Nintendo at least has to put on a show.

I remember on the Gamecube Nintendo started re-using very ho-hum Mario models in multiple games and they looked worse than SSB Melee which had come out first.  Having been used to Nintendo pushing their hardware to the limits on previous consoles this intentional restrainst caught me off guard.  But in retrospect that was a big hint of what their later consoles would be like.  I think Nintendo just hit the limit of where they wanted to go with the Gamecube hardware and they don't really want to go beyond that.  Even now that they have "HD hardware", the games they've have released thus far don't impress on a technical level.  The graphics don't stand out and the scope of the games seems small.  You look at the big sprawling world in the GTAV trailers for example and Nintendo seems completely disinterested in making something of similar ambition and size.  This doesn't apply to all of their devs (Retro pushes graphics; Monolith pushes scope) but it certainly applies to EAD.

I don't think Nintendo wanted to make the Wii U because they don't need better hardware than the Wii to make the games they want to make.  It's a product that the market was gradually forcing them to release because a videogame console that doesn't even support HD resolutions just doesn't fly anymore.  We've got a controller "innovation" effectively lifted from the DS and their big launch games were a mini-game comp and a 2D platformer - titles with no real ambition to them that aside from the Gamepad could have probably been done on the Gamecube with slightly inferior graphics.  Typically Nintendo would make a big splash with their new consoles to show off the new stuff they can now do.  But with the Wii U I have yet to see anything where it was clear that Nintendo's devs were just waiting with anticipation to finally have the hardware to achieve their idea.

The third party support, the first party lineup and the marketing have all been approached by Nintendo with an air of utter indifference.  I don't know if they've run out of ideas or if the higher-ups have just become old and conservative or if the company thinks that ambitious games will be too expensive to make.  But clearly they aren't excited to be working with the Wii U hardware and it is unrealistic to assume that any third party would be instead.

Carmine's closing bit is profound. Dude gets it, and summed up Nintendo better than I've ever read.

With the high development costs being what they are Nintendo could easily money hat weaker game developers into putting their games (exclusively) onto the Wii U. It is just that Nintendo's conservative approach is no longer working for them. It is quite possible that the Wii U might become Nintendo's worst selling console of all time. As for relying solely on their first party arsenal, Nintendo had better make some amazing games if they want to fork over my hard money in this day and age, and judging from their line up thus far, noting intrigues me enough to support the Wii U except for two games: X and Bayonetta 2.

I've said this before, but the big take-away from the WiiU might be the no-latency streaming tech rather than the touchpad.

Imagine if you had the whole console inside a Gamepad-sized handheld, that came with a an HDMI dongle that you could plug into any TV or monitor and would stream wirelessly.

I can't think of any detailed comment on the excellent editorial, but...

The moral of the story? That clan may never control all of Japan, and Nintendo may never truly win the console war. But they’ll survive, and they’ll survive by doing what they do best and by avoiding over-extending themselves. That’s the mindset Nintendo has. That’s why they’ve never conclusively solved the third-party problem. And that’s why Iwata’s third-party plan seems unexciting and unambitious. Nintendo is a mountain, and the mountain does not move. It simply endures.
This is why it’s so hard to be a Nintendo fan. You going into this thinking you’ve picked a winner. But the simple fact is that Nintendo’s not a winner. Nintendo’s a survivor.

I know I'm in the minority, but I don't see this happening.  Nintendo wouldn't want to ruin their cash cow in the 3ds and Sony/Microsoft wouldn't want to compete with Nintendo on a hybrid system.


They really would push their Wii U issues down to the 3DS by making all games cost $20-30 million instead of the <$10 million on 3DS they get now.  While technically, they could build a Wii U powered 3DS, it would not come cheap.  The 3DS is in the sweet spot now.  The portable market wouldn't support a $400+ gaming system with $60 games.  That would push anyone wanting something portable to a tablet.  Also, Nintendo would still have to work to get the big third parties to support the system.  The 3DS has decent third party support, but it's more niche than what PS3/Xbox 360 have.  They'd still have to work to get GTA, Mass Effect, etc. 

I think you are misrepresenting what Nintendo was trying to do.  They had a console that wasn't making money.  This meant they had to subsidize the console with software earnings.  It also meant that third party support was worse than the last generation so they had to make more 1st party titles to fill schedules.  The Gamecube Era was like the N64 era on steroids.  Less money, more games means lower quality games. 

It's the same thing with the FE needs to sell 700,000 thread.  Yeah, it would be awesome if Nintendo could spend 30 million on every game and sell at least 700,000 units to make it worthwhile.  But if trends continue they'll need to find ways to cut corners and make games profitable for 250,000 units sold.  I don't necessarily think that is a bad thing.  I wish they would either develop a studio or purchase a studio and have them focus on creating an eshop game every 6 months.  Not every game can be a big production game. 

It's really annoying when you are trying to type on a touch phone and it requires a great amount of effort to both type accurately and see in entirety what you wrote. 

Umm... did you completely forget about the entire Wii generation, where Nintendo sold a metric shit ton of consoles and third parties still avoided them?

Ask Microsoft and Sony.  They continue to throw money hats around, to the same groups, for exclusive games, features and content.  With no end in sight.

Well, all I have to say on Carmine's position is that if that's the position you want to take up, that Nintendo doesn't need 3rd parties and their "me first" mentality is the core of what they are, that's fine.  That's your opinion.  However, I think you then forfeit any right to complain about the Wii U being ignored in the general gaming media and Nintendo generally being thought an irrelevant dinosaur that should go 3rd party.

For that matter, you also forfeit the right to complain when 3rd parties announce that all their major titles are going to every major gaming console and mobile platform except the Wii U, because Nintendo's delusional mindset benefits no one but themselves.

If Nintendo is going to be the mountain that just survives, how do they sell enough people on that to bank them?  They can't literally live off the land of the mountain.  The whole thing relies on people buying their product and they have to convince those people that it's a product worth buying.  Weak third party support diminishes the value of the console as a product.  Because really third party support is all about having a good selection of games and if you have no games your console sucks.

A big reason why I don't own a Wii U and got really fed up with the Wii was because in the past I had hope that Nintendo would do better.  My enthusiasm died when I realized that not only were things not going to get better but that Nintendo was incapable and/or unwilling to try.  I'm not a Nintendo investor.  I don't benefit from them being this isolated mountain.  I benefit from a console having as many of the best games out there that it can.  Only the most irrationally loyal Nintendo fanboys will cling to a hopeless Nintendo.  For everyone else it is merely a matter of time before they get fed up and realize that the problems will never be addressed.  Because it relies on outside purchases this is a model doomed to fail at some point.

And the Wii U ain't selling and Nintendo posted losses in the previous two years.  The model is failing right now because no one wants a glorified last gen console with unambitious games and no third party support.  A console with weak third party support is a shitty product and Nintendo can only sell a shitty product for so long before everyone catches on.  The only reason things were so peachy for them last gen was that they found a new audience that didn't know better.  The Wii U is selling like how I figure the Wii would have sold if it had to sell only to the traditional videogame audience.

It isn't even like a sports team where you want Nintendo to win because they're your "team".  It's as simple as a console not trying to "win" providing an inferior experience to its userbase.

I don't complain about it, I just laugh at how out of touch the gaming media is. :D

And they, in turn, laugh at how out of touch both you and Nintendo are. It's quite the symbiotic relationship.  :P:

Let them laugh while they continue to scrape by selling Doritos and Mountain Dew.

I'll be sitting here, playing my Nintendo games, having fun.

Hey, remind me again about all the independent video game magazines that have been going strong for years.  Oh, and that awesome video game television network... how's it getting along?  Then there's the internet video game sites... which one of them isn't incompetent this week?

The bottom line is that Nintendo is going to have to work for a living to make the Wii U successful. They need a price cut by the end of November of this year. The same old routine that has gotten Nintendo by in the past will not cut this time around. Yes, Nintendo is going to have bribe certain developers, but they are too stupid to realize this and implement it. Grand Theft Auto V would have been a good money hat for Nintendo to bring over to the Wii U. 

Nintendo has always worked to make their systems successful.  Even in the glory days of the NES and SNES, they fought hard, tooth and nail, against third parties, stores, government agencies...  In spite of the revisionist history some may believe, Nintendo has never had a cake walk selling their stuff.

Why is it so hard for Nintendo to try and strengthen ties with third parties rather than let the status quo go on?

Because the status quo isn't working and neither side seems all that interested in changing it.

I think Nintendo has survived is premature just like it's premature to assume we've reached the end of consoles.


There are two things that have been consistent. 


1.  The video game console market has grown each generation.  This last generation is at about 260 million units sold.  If you look up Sony/Microsoft/Analysts they expect this next generation to be the biggest ever.


2.  If you exclude the Wii generation, Nintendo has sold fewer and fewer each generation. 


NES - market leader, great third party support
SNES - market leader, great third party support
N64 - Strong second place, started with best third party support and it faded throughout the generation
Gamecube - I'm going to say strong third place because the Xbox barely outsold it.  It had poor third party support, but it had almost all the multi-plat games from EA/Ubisoft and some unique exclusives such as MGS/RE, Eternal Darkness, etc.
Wii U - initially terrible third party support.  Zombi U the only third party exclusive I can think of. 


You can rewrite history and call Nintendo a "survivor" but it's not true.  At best they survived the Gamecube generation and this is starting out with worse support for them.  I think they also have to be worried because the PS2 generation is now dads.  Which means they will want to buy their kids a PS4/Xbox One and don't have the nostalgia factor to pick up a Wii U that dads of the N64/Gamecube era did.

It's simply not in their nature.
How much do you know about early NES history?


Back in ye olden days, when unlicensed, unregulated games virtually destroyed the entire video game industry in the US - to the point where Toys R Us actually changed their theme song to remove the reference to "video games"?
Back when Nintendo basically had to beg retailers to stock their system?
Back when Nintendo employees would have racial slurs thrown at them by overnight janitors while setting up displays in stores?
Back when Nintendo first extended an olive branch to another company - Atari - to even try to enter into the US market, and Atari back stabbed them at every turn?


Keeping in mind that Nintendo is a very, very Japanese-centric company at its core to begin with - which means they're independent and strong-willed - to the point of being controlling and protective.

Nintendo (NCL, in particular) really doesn't much care about third parties.  Period.  They didn't then, they don't now.

If you haven't figured that out by now, then I'm not sure what would convince you.

Heh. Well...ok. At least you didn't say great third party relationships.

The funny thing is - the NES didn't start out with great market support.  It didn't even have a single third party launch title.  When it started becoming a huge success, and with no other real competition to turn to, third parties supported the NES.  Oddly enough, EA was not a fan back then either.

When the Genesis came out, third parties clamored over themselves to jump ship to the Genesis - mostly because of how tightly Nintendo controlled the entire third party structure during the NES years and because of how loose SEGA was with money hats and agreements to get games over to the Genesis.

Funny thing - as much as the SNES is said to be a third party extravaganza... go pull virtually any top ten "Best of SNES" list.  Now, remove all the first party titles.  Now, remove the Squaresoft and Capcom titles.  What's left?  And how many are exclusive titles?

SNES has legendary third party support pretty much because of those two companies alone.  And Squaresoft... well, she ain't what she used to be, eh?  And Capcom... well... I assume you've all heard the news about their layoffs today...

I have been of the belief for a long time that a perfect storm is heading for the gaming industry. This is mainly due to the rising development costs that permeate the industry. This is the real reason as to why Nintendo gimped the Wii U. With Capcom laying off the workers recently it appears to me that a massive kulling of the game industry is going to happen soon.

Uncle Bob, I'm not saying there isn't a reason Nintendo is the way they are.  Clearly, they built the modern console with the NES and enjoyed a strong monopoly early on.  The SNES was a very solid system, cutting off at a top 10 is a bit harsh.  The top 30/50 games enjoyed strong success on the console.  Also, there were fewer developers back then.  Square, Capcom, Techmo, and Konami all gave the system exclusive support.  Yes, some tried to develop for the Genesis, but the Genesis was really on strong in the US and Japanese developers supported the SNES better since it sold way better in Japan.


I guess I feel like this is a good summary of Nintendo.  They built modern gaming.  DK, Mario, Zelda, Metroid, Goldeneye.... Most games are built from them.  They enjoyed early success and consumers loved them.  But as competition entered the market, Nintendo has continued to lose market share and turned away from their customers.  No company can have long term success if the focus isn't on the customer. 


Nintendo (N64), gamers don't want bigger games (discs)


Consumers that want bigger games move too Sony


Nintendo (Gamecube/Wii/Wii U), gamers don't want third party games


Consumers that want third party games move on to other systems.


Nintendo (Wii), gamers don't want HD


Consumers that want HD move on to other systems. 


Consumers want to save $ on a console, not a powerful console (Wii/Wii U)


Consumers that want great graphics/great physics move on to other systems.


They aren't listening to their consumer base and consumers are choosing other products.  You look at lists of most popular games now and it's flooded with games that aren't on a Nintendo console. 

Sorry for the double-spacing.  When I use Chrome with this site, it adds that.  I used to go back and get it out, but that option is no longer available. 

All the industry had higher development costs last gen.  EA said PS4/Xbox One will be 3% higher cost to develop for than last gen.  Capcom/EA and the other big players are focusing on releasing profitable titles and cutting staff.  Most titles lose money and they are changing there strategy from a more is better approach.  Certainly some developers will go out of business, but I don't see it being as bad as long gen when costs did increase substantially. 

It always seemed silly to me when people say Nintendo gimped on hardware when all they did was decide not to lose hundreds of dollars on it. Microsoft and Sony changed the rules. While it is Nintendo's responsibility to adapt to a rapidly changing industry, it doesn't make sense to me when people suggest Nintendo follow their competitors' lead to create the illusion of success. It took Microsoft and Sony years to finally stop sucking so entirely on the financial end. They now suck almost entirely. Who thinks that's a good way to run a business? That's a rhetorical question. A lot of companies do. And guess what? They're all closing or restructuring. How are we measuring success these days?

Now, I'm not saying Nintendo got it right. They haven't. Nintendo has dropped the ball with Wii U in many ways. What's confusing me is that people keep complaining that Nintendo is doing X and Y wrong without offering a better solution. "Throw money at people/things" is not a better solution. Didn't Microsoft spend like $50 million for GTAIV DLC that wasn't even exclusive? Is that the expectation now? That's like racing towards the edge of a cliff. You win, but really, you lose.

And I think it's ridiculous to give third parties money they aren't going to use responsibly. They're just going to keep coming back with their hands out demanding another pay out. That's bad for everyone. It doesn't seem that way to consumers because we just see the end result, but really it is. Their business plan is "We just need to sell more copies than we've ever sold before." That's basically:

1. Collect underpants
2. ?
3. PROFIT

Enjoy those games while you can because those companies are on the verge of going out of business.

While I like the idea of having a large library of titles to choose from, I don't think it's in Nintendo's best interest to sacrifice their entire culture and identity chasing fickle gamers and irresponsible third parties. Nintendo shouldn't be encouraging third parties to expect a bail out from them. If Microsoft and Sony want to play that game, let them. There's a reason Nintendo is still in the industry. I don't know if there is a way for Nintendo to compete in the same space without playing the same toxic game. Honestly, I think that's better for them even if it's worse for me as a consumer who wants to only buy one console. If those companies are crumbling anyway, I suppose it doesn't really make a difference in the end.

Would the wii have been less successful if it had cost 350 and had hd?

Sony lost bunches because they decided to subsidize blu ray and get it into homes. Microsoft lost bunches because of the rrod issue. Neither lost money because they brought an hd console to the market.

You assume buying content isn't a better solution. I don't know how much microsoft made off dlc and how many more sales of gta 4 they made but I'd be really surprised if their licensing fees didn't offset the 50 million and more.

Maybe third parties will keep coming back with their hand out. I think if Nintendo cultivated a third party market then there would be ways for third parties to make money and they wouldn't turn from it. I don't think sony moneyhatted gta 4 and they still got it. But heavy handed practices work when you are a monopoly (nes snes).  They don't work when you only garner a small portion of the market. It would be nice if Nintendo would find a middle ground where both they and the third party win.

Which game companies are crumbling?  Microsoft and sony game divisions made money last year. I looked up a few big third parties and they did pretty well too.

I know you buy the pr speak of subsidizing third parties, but these games subsidize hardware makers.  I.E. Gta 4. That game sold 25 million copies. If licensing fees are still at 20%, that is a potential 300 million in licensing fees up for grabs to hardware manufacturers. Did the game manufacturer develop, market, take on the risk for that 300 million?  Shouldn't Rockstar be able to profit from their work?  Moneyhatting is a reduction in fees, not a subsidation model. Nintendo is trying so hard to not lose their 20% that they lose licensing revenue altogether. Every game that doesn't come to Wii U is lost money to Nintendo.

I agree.  Even the N64 was a pretty strong effort, but it was handcuffed by the cartridges.  I actually didn't notice Nintendo seemingly coasting until the Gamecube where so often it seemed like they just assumed people would buy it because it was Nintendo.  Now Iwata became the head of Nintendo during the Cube generation and I believe he was heavily involved in it from the beginning so it might be the change of leadership in the company that affected it.

The Gamecube was also launching under different circumstances than Nintendo was used to.  The NES effectively created the console market in Japan and the SNES and N64 were both launched from the position of being the market leader.  The Gamecube was the first console to launch after Nintendo had been knocked off their perch.  It seems like they either did not realize that they had to work a little harder to earn back consumer trust or that they were too arrogant to admit to themselves that they had to do that.

This is how I see it:

Gamecube - first Nintendo console launched from a position of weakness.  Nintendo needs to demonstrate that the N64's problem will not be continued and win back a market that has lost interest in them.  Nintendo fails to do any of that and operates like they're still the market leader and have clout to not offer this or half-ass that or tell the market what they want.  The market naturally rejects the console and it finishes in last place.

Wii - rather than admit that the Cube's failings are largely their own fault, Nintendo talks up complete nonsense about people losing interest in games (at a time when market is growing every year) and acts like the whole situation was and is hopeless.  They effectively give up on the traditional market and go after casuals, a group that is not familiar enough with gaming to be aware of Nintendo's negative reputation from their previous two consoles or to notice all their recurring problems and bad habbits that created that reputation in the first place or to be aware that the "new" console is pretty much their old console with a new controller.  This plan actually works surprisingly well, though while the casuals eat it up, the traditional market now sees Nintendo almost strictly as a casual game company and thus irrelevent in regards to "core" games.

Wii U - Nintendo tries the Wii strategy again but discovers that the casual console boom was a fad and that market has moved to gaming on their smartphones and tablets.  This leaves just the old traditional market for which Nintendo, like with the Gamecube, is launching from a position of weakness.  But as usual they either don't know or acknowledge this and go about as if they're the market leader with all the clout that can coast by on a weak effort.  Following the Wii model also has resulted in a similar hardware design to the Wii - glorified last gen hardware with a gimmick controller being released right on the eve of new consoles from Sony and MS and the market is well aware of this.  Unsurprisingly the Wii U is flopping hard.

Nintendo needed to learn from their mistakes back in 2001 and they didn't and then they found a way to avoid that for a generation and have just kept pushing it aside like some immature egomaniac.  Well it's catching up to them right now.

I think it's a pride issue.  Nintendo is too prideful to admit they could be better with outside support or ask for help.  I actually think it's borderline unethical.  Their job is to maximize shareholder value and ignoring the billions of dollars of potential licensing fees does not do that.  You can talk about doing it the Nintendo way, but that's not a thing shareholders care about. 


I don't agree with examples of places where money was spent and they lost out.  You need to spend money to make money.  Pointing out a few areas where people overspent or didn't spend wisely doesn't mean don't spend any money.  It just has to be managed well.  Nintendo spent billions on R&D for the Wii U.  Why did they do it?  To make money.  Was it spent well?  I'm not sure yet, it depends how this generation plays out.  The Virtual Boy money wasn't spent well, but I'm glad they came out with subsequent handheld consoles and addressed some of the issues with that console. 


If in business you have to spend money to make money, wouldn't it make sense that they would have to spend money on third party support to build up a licensing fee revenue and sell more Wii Us? 

Once again, I find myself mostly agreeing with Kairon.

I don't really get comparisons to the GameCube. Nintendo rushed many games to market during the GameCube days, which is something they're not doing with Wii U despite how badly it needs games. Pikmin 3 got delayed until it was ready, Mario Kart isn't being forced out for the holidays, they didn't rush Smash Brothers to be ready at launch... The Wii U is no GameCube, and that's a good thing.

No analogy is perfect.  I think the Gamecube comparison is pretty straightforward from the perspective that consumers and third parties are seemingly rejecting the Wii U as a viable platform. 


I also think it's too early to say Nintendo won't rush games to the market.  They realized they didn't have the games to fill the schedule for six months so they abandoned  the platform with the idea of filling the holiday with a good release schedule.  I could see them moving to a rushed schedule if the holiday games and Mario Kart/SSB fail to increase consumer interest in the Wii U.


I got to listen to Jim Collins, business author, speak about about what makes a great company.  His studies indicated that the best companies companies held onto to their core, the 80% they do right and change 20% overtime to adapt to the market.  Consumers aren't loyal, you can't confuse that with fickleness.  If I was going to say what is Nintendo's core that they do right, I'd say branding and strong software development (1st party titles).  It I was going to say what can they change that's not core to their business I would say they could use better online infrastructure and better relationship/support from third parties. 


Jim Collins indicated that a big indicator for failure were companies that either changed nothing (0%), or changed everything (100%) including their core values.  I can't remember the statistic, but it is astounding how many big companies (Dow Jones/S&P 500) from 50 years ago that are either insignificant now or are bankrupt.  There were alot of companies that people considered mountains in that group.

I really feel that Nintendo doesn't think they need the 3rd parties.  They seem to have shifted their focus to indies and by all accounts have done a solid job courting them.  It will be interesting to see  if they can survive as the Nintendo+indie platform.  I don't think they will see a big sales jump from courting indies unless they somehow manage to luck out and get the next big hit like Minecraft.  Indies aren't going to sell platforms, but right now that seems to be the basket Nintendo is putting their eggs in.

Question people are saying Nintendo shouldn't lose their Identity trying to become Microsoft Studios or Sony Worldwide studios. But isn't this a care that modern day Nintendo isn't really as compent as they sued to be and they have lost touch with its own core so to speak. I mean Nintendo seems intrested in chasing a market that no longer cares for them and appeling to the Nostalgia of those who grew up with the 8/16 bit era's. They seem to have forgotten or doesn't care to try and market and appeal to me the 21 year old who grew up with the  N64/PS1/Gamecube/Playstation 2 eras.


Plus Nintendo has made them selves into the insualr bubble where they don't care for cartering too third parties or feeling them gaps themselves. I don't mind them not caring about the Third Party support as I'll never only buy a nintendo console at this point but why not invest in studios to make that srt of content for them to satisfy those who only game on Nintendo systems/



Microsoft Studios
Xbox 360
Gears of War Judgement
Fable Anniversary
Zoo Tycoon
Project Spark
Ascend Hand of Kul
Battleblock Theather
Charlie Murder
Crash Course 2
Lococycle
Max and the cursed brotherhood
Motocross madness
State of Decay
Super Time Force
World series Poker: Full House Pro


Xbox One
Forza motorsport 5
Ryse son of rome
Kinect Sports rivals
dead rising 3
Lococycle
Zoo Tycoon
Killer Instinct
D4 Episode 1


Sony World wide studios


Playstation 3
Diggs Nightcrawler
Dust 514
God of War: ascension
MLB the Show 13
Sly Cooper: Thieves in time
Beyond Two Soul
Gran Turismo 6
Invizimals the lost kingdom
Puppeteer
Until Dawn
Rain
Ratchet and Clank: Into the nexus


Playstation 4
Knack
Killzone shadowfall
Drive club
Planetside 2 (still a bit iffy)
DC Universe Online (iffy as well)


Playstation Vita
MLB the Show 13
Soul Sacrifice
Sly Cooper: Thieves in Time
Invizimals the alliance
Killzone Mercenary
Tearaway


Microsoft Studios and SOny Worldwide developers can support 2-3 platforms with mutiple games while Nintendo can barley support 1. Not only that but despite the cries of Nintendo being the most unique and having the most refreshing E3 (lack of the shooting) they're line up this year is the most homengized of the three only opening having certain types of games and IP, while Microsoft and SOny we have a mix of new and old IP, different genres, and gameplay styles.




 

It's no secret that Nintendo has been dragged kicking and screaming into HD development.  They don't like doing it, aren't particularly good at it (so far, but that can change), and generally disagree with it as a business strategy. But, unfortunately, that's the console market as it stands in 2013.


Another harsh reality is that the console audience is more tech savvy now than it's ever been. Nintendo can't keep trotting out older hardware in a day and age when there are sites like Digital Foundry that literally exist to tear apart technology the day it gets released and issue a verdict (hell, Microsoft is getting roasted for having GDDR3 RAM instead of GDDR5 RAM).  Couple that with the fact that you have huge and loyal installed users bases for the Xbox and Playstation brands and you just can't get away with that stuff any more.


It's pretty clear that Nintendo's strength is in smaller-scale development projects, which is why they've always had juggernaut handhelds with amazing games.  This also fits their business philosophy, which is to keep development costs down as much as they can while making affordable games that sell to a broad audience. Console development today flies in the face of pretty much all of that, outside of eShop content.


As for what type of hardware they should make, I've thought that a portable console would be a brilliant move for, oh, about 10 years:


http://www.nintendoworldreport.com/forums/index.php?topic=9276.0


I feel like it took them a decade, but the Wii U Gamepad seems to be moving them in this direction. I hope it does.

The Laffer curve in action?

So on the Gamecube they were rushing games and on the Wii U they're letting the console crash and burn with no software while they slowly get the games ready.  What's sad is that the cure to all this is healthy third party support!  Nintendo seemingly doesn't care about this issue but if they had better third party support they wouldn't have the same pressure to carry the consoles themselves.  They've been caught off guard with HD development but if they had healthy third party support it wouldn't matter.  The Wii U would just chug along on third party games while Nintendo gets their own stuff ready.  Do they even realize how much better off they themselves would be or do they just really not like playing nice with others?

Smallshark brough up the Collins 80-20 thing.  When I think of what Nintendo was bad at during the N64/Cube time period, it hasn't changed.  Yet I feel that they're now worse at the stuff they were good at back then.  They changed the good stuff and left all the crap which suggests to me that Nintendo's BAD habbits are deep down the core values of the company, which is sad.  They'll compromise controller design and game quality, scale back creativity and ambition, start going with last gen hardware for their consoles, neglect their old customer base for a new one, but will keep the penny-pinching, the poor relationships with third parties and retailers, the wacky Nintendo solutions for conventional stuff, the stubborn refusal to move forward on technology that literally the rest of the industry is adopting as the standard.

on the other hand it seemed like at launch Wii U had great 3rd party support. As soon as those games didn't sell though it just dropped off.  Nintendo really needs to be relevant again on the console front. They need to release a relevant game. Most of us are just upset we don't have Pikmin 3 yet.

I'm a Nintendo-only console owner, but let me just say that I'm not necessarily saying that Nintendo is doing the right thing, I'm just trying to describe a way to think about them that describes why the term "The Nintendo Difference" even exists, for better or for worse. ^_~

I don't believe that Nintendo has a mindset that they don't need third-parties. Iwata has made some significant strides in courting third parties lately, but this progress tends to be modest and focused on Japanese companies like Capcom and Sega, not Western companies like EA. And like I said before, it's natural organic progress, not progress driven by bags of money.

Maybe it would be more accurate to say that Nintendo feels that they don't need third parties who will only make games for them if Nintendo pays them?

I think this is an absolutely accurate assessment. Let's not forget the legacy that Gunpei Yokoi left at Nintendo: Lateral Innovation with WITHERED technology. "Withered" technology is cheap technology, for developers AND consumers. But affordable tech just doesn't seem in vogue these days. Again, I'm not saying that's good or bad, I'm just saying that it's consistent with Nintendo's background.

It's actually really interesting that you bring this up, because Iwata actually fielded a question about Nintendo's value to shareholders, just check out Question 16 on this page:
http://www.nintendo.co.jp/ir/en/stock/meeting/130627qa/04.html

Businesses only care about processes that drive large bags of money.

If cheap technology does not excite developers or consumers than I would say that's a poor approach to a market typically driven by technology.  The Ipad is the bests selling tablet despite costing bunches more than their competitors because of the perceived advantages it has over it's competitors.  This market isn't different.  Consumers feel Microsoft and Sony bring a better product to the table and purchase those devices despite them costing more. 

I think that's a poor answer.  "Under the current circumstances, however, we think that a buyback alone cannot change a large trend without also improving corporate performance and proving that our current business structure will work well in the future."


They want to prove their business model works then he quotes a bunch of stats that go back six years when the Wii and DS were both money printing machines.  The Wii success doesn't prove their business model.  It just proves they were first to the market with motion controls when the market wanted those.  It's an example of innovation in the industry.  They don't have innovation with the Wii U and are back on the pre-Wii trend of not only losing marketshare, but losing sales. 


Is Nintendo a niche company?  That would be a reason to try to keep costs down and focus on a smaller market.  I don't think they are a niche company, but it seems they are playing the game like that.  That's what is so frustrating is Nintendo characters were my youth and today's youth isn't experiencing that. 

One way or another I think the WiiU is a 5 year system.  With the XBone and PS4 being 10+ year systems so I be interested to see what comes out of Nintendo in 2017.

At the minimum they will jump the XBOne and PS4 in power but, what will they do on Features?  They had a killer app in TVii by all descriptions and the Remote potential of the WiiU but they really messed those up.  We'll see.

That's why I talk about Nintendo Exceptionalism. Sure, Nintendo is a business, but their history, culture, and self-image make them a business whose choices defy conventional wisdom. It's perfectly valid to see that as tragic foolishness, just as it's also possible to see that as singularly heroic. But if you want to step beyond the debate of how much right or wrong Nintendo is doing at any particular moment, and actually try to understand why "the Nintendo Difference" became a thing, then I think you definitely have to discard your preconceptions about how a videogame company might view technology, art, value, creativity, and their own relationship with their players.

Again, everything I've been saying isn't an attempt to say that Nintendo is doing things right. It's not a way to say that they're doing things wrong. It's just my way of trying to understand the company that gave me Zelda and Mario Paint, Wii Music and Pikmin.

It's not about defying conventional wisdom, it's about listening to the market and supplying it's needs. 


Nintendo is a creative company no doubt.  But they got big because they found voids in the market and filled them.  Not because they thought about the business environment differently.  I also think you are re-writing history.  They really acted like a rational/traditional business until Iwata became the head.  Then the Wii worked out and it looks like the Wii U won't work out.  It seems people come up with things like exceptionalism to try and absolve Nintendo from blame for doing things that the are contradictory to what the market wants when it's pretty obvious it was a bad decision. 


Disney is a creative company that finds to reach out to the market and become a beloved company.  Why is it Nintendo fans are always, "Nintendo drives me crazy with their decisions, but it's okay, because I love the games they create."  That to me is doing business wrong and the market is getting turned off to Nintendo (at least in the home console market where there is strong competition).