Nintendo, doomed? The Wii and the DS are massive sellers. It's almost an incomprehensible idea. And yet, after comments made by Nintendo's president, Satoru Iwata, one analyst saying the company is "doomed," and he isn't alone.
So, what could Iwata have possibly said to receive such damning criticism? At a Nintendo press conference held during the on-going Game Developers Conference (which is, for the most part, a place where video game industry folks go to talk about how to make better games for all of us), the Nintendo prez set his sight on the iPhone and Android, and the "casual" games that have been such a success on both platforms. Since both iOS and Android aren't made exclusively for gaming, Iwata said that developers had "no motivation" to improve the quality of the experience such as on, say, the 3DS.
"The value of games does not matter to them," Iwata said. "The fact is, what we produce is value, and we should protect it."
Your average DS or Wii game will run you anywhere from $20 to $40. An app game on iOS or Android? A buck, usually, or $5 to $10 in a rare instance. Iwata wouldn't put the blame on Apple or Google, however, or even the developers, simply stating that "these platforms have no motivation to maintain the high value of video game software. For them content is something created by someone else."
For Nintendo, both Apple and Google are in the same airspace. Whereas you can't get the same graphically rich, complex gameplay experience that's delivered on the PC, Xbox 360 or PlayStation 3 on a handheld, you can enjoy on your phone the same kind of experience Nintendo is bringing to the table, and for cheaper, without purchasing more hardware.
Michael Pachter, an equity research analyst of Wedbush Securities and someone who keeps a close eye on the video game industry, had this to say: "Long-term, Nintendo is doomed. [Iwata's] under full frontal assault by Apple."
That long term? The casual space that Nintendo plays in. Nintendo is going to sell a boatload of 3DS units and whatever comes after the Wii, but the fear is that it's a shrinking market for the company, and games are expensive to make (versus an app, which can be made by two kids in a garage, basically).
"The majority of people here are creating games for social and mobile," Iwata added. "I fear our business is dividing, and that threatens the employment for those of us who make games for a living."
Folks responding to Nintendo echoed Pachter, however, even others inside the industry: "He may be right, but then the 200 to 300 million people who play games on Facebook are wrong," said Jeff Brown, the VP of corporate communication for Electronic Arts, a video game publisher. "Social gaming as a whole aggregates into a business that is undeniably big money. When it's that big you are forced to pay attention."