Donkey Kong delay hurts Wii U holiday lineup

Tropical Freeze pushed to February as Nintendo leans on Super Mario 3D World, Mario & Sonic Olympics, Wii Party U to bear the load.

Tropical Freeze

The Wii U’s holiday lineup is looking a little lighter as Nintendo today delayed the launch of Donkey Kong Country: Tropical Freeze. Previously set for a December debut, Tropical Freeze has been pushed to February in North America, as confirmed by Nintendo president Satoru Iwata during a Nintendo Direct presentation.

“In order to deliver the optimum gaming experience, we need a little more time for development of this title,” Iwata explained, adding, “We would like to apologize for this delay and hope you understand.”

The Wii U’s holiday lineup still has a handful of big exclusives yet to launch, including Super Mario 3D World on November 22. The same month will also see the launch of Mario & Sonic at the Olympic Winter Games Sochi 2014, as well as the digital debut of Wii Fit U. Meanwhile, October’s release slate is headed up by Wii Party U, Sonic Lost World, and this week’s retail launch of The Legend of Zelda: The Wind Waker HD.

Analysts including IHS’ Piers Harding-Rolls and Baird’s Colin Sebastian have pointed to this holiday season as a key stretch for the Wii U. Sebastian said “the fate of the platform” rests on its holiday software lineup, while Harding-Rolls said this season’s sales performance will dictate his firms long-term outlook on the system.

Can the 2DS change the game for Nintendo?

The 2DS

The 2DS is a neat package for a nice price. But can it rejuvenate Nintendo’s ailing business?

When Nintendo unveiled the 2DS, a new lower-priced member of its celebrated line of DS mobile gaming consoles, fans met the news with characteristic excitement. But for market watchers, the 2DS seemed like a peculiar answer to a persistent problem. The Wii U hasn’t been selling very well, Nintendo admits, and the marketplace for mobile gaming devices has steadily shrunk as the one for other mobile products has exploded. Whether or not fans want the 2DS, is it what Nintendo needs to set itself back on the right course again?

“I think the 2DS is brilliant,” Michael Pachter, an analyst at Wedbush Securities told NBC News. Pachter is one Nintendo’s most vocal critics — he called the Wii U a “failure” and said Nintendo CEO Satoru Iwata “sucks.” So it’s surprising to hear him sound such a positive note.

Yet Pachter insists that Nintendo can’t really go wrong with the 2DS, chopping 3DS bells and whistles — the stereoscopic 3-D effects and a bendable hinge for its two-screen display —  giving it a more affordable price ($129 vs. $169) in the process.

“It’s going to lift sales,” he said. “It just is!”

Other analysts like Piers Harding-Rolls of IHS Electronics and Media and Lewis Ward of IDC’s gaming division, agree. Both told NBC News that Nintendo is essentially going down market to snag a new group of customers — prospective buyers, mostly young children or their parents turned off either by the price of the 3DS or the scary-sounding labels that warn about its potential to cause seizures. In the process Nintendo can then up-sell the 3DS as a “premium” counterpart to the new device, thus hitting the mobile gaming market with a sort of one-two punch.

“The 2DS launch removes the pricing pressure on the higher-end 3DS and gives the company a path to up-sell from 2DS to 3DS, with both the hinged form factor and 3D as a selling point,” Harding-Rolls of IHS told NBC News.

This is how Nintendo itself sees the new product. The new console is “designed specifically for consumers looking for an entry point into or a new way to enjoy the Nintendo hand-held experience.” Scott Moffitt, Nintendo of America’s executive vice president of sales and marketing, told NBC News. He added that the launch of the 2DS does not mean the company had any plans to phase out the 3DS or spend any less time focused on that device as well.  “Content will be shared between both systems” Moffitt said, and that the 3DS is “very popular in the market, and we expect that will continue.”

But Melissa Otto, an analyst at TIAA-CREFF, isn’t convinced that a new DS will do Nintendo any favors.

“The DS was a huge success in the past,” Otto told NBC News. “But we have a whole new group of products now — tablets and smartphones. We didn’t have those five or six years ago!”

Now, Otto said, parents are no longer choosing between Nintendo or Sony when it comes to buying their children a portable entertainment device, but choosing between “tablet and console,” or “smartphone and gaming device.” And at the end of the day, a console “is not as multidimensional a product.” It may cost less than a smartphone with a data plan, but it also gives its owners “less bang for their buck.”

Other analysts didn’t deny that smartphones and tablets have eaten away at the market for mobile gaming consoles, but questioned how profound the immediate impact of these devices would be on Nintendo’s business.

Still, even Pachter said that the market for smartphones and tablets is now “10 times as large” as the one for mobile gaming consoles, describing Nintendo as “a victim of technological advances” that mean the latter is no longer a 30-million-sales-a-year market. The 3DS may be selling well — reaching 32.48 million units sold as of July 2013, according to Nintendo, and remaining the best-selling console for three months this summer in the U.S., according to NPD data. But that’s nothing compared to the 153.93 million units the original DS has sold.

For Otto, that’s the whole problem. “Hardware doesn’t make Nintendo money,” Otto said. “What makes them money is their content, their software.”

But the company still won’t separate the two by putting any of its franchises on massive platforms like the iOS app store or Android’s Google Play. And as far as Nintendo is concerned, it’s never going to.

“I think it’s plain to see that Nintendo hand-helds offer a more complete gaming experience, with richer controls and more immersive gaming worlds,” Scott Moffitt of Nintendo said. “One of the reasons that people have such a fondness for Nintendo franchises and characters is that their games are paired so well to Nintendo’s hardware. Nintendo’s IP works best on Nintendo systems, and that’s where it will remain.”



Nintendo preps free-to-play title

Wii U maker tells analysts it will explore new business model with non-Mario, non-Pokemon game by end of fiscal year

Nintendo preps free-to-play title

Nintendo may be resisting bringing its brands to smartphones and tablets, but it’s still interested in the business models that have driven the mobile boom. As spotted by Polygon, analyst David Gibson attended a Nintendo briefing event at E3 today and tweeted about the company’s intention to explore free-to-play.

“Nintendo free-to-play game will be released this [fiscal year] but will not be Mario or Pokemon game as already have good relationship in those brands,” Gibson said. (Nintendo’s fiscal year ends in March of 2014.)

While the platform of that game wasn’t specified, Gibson said Nintendo president Satoru Iwata made the remark in a section of the briefing dedicated to the Wii U. Iwata also said that the 3DS’ success in Japan is proof that dedicated handheld platforms can thrive despite the competition from smartphones.

Nintendo has already indicated that it would welcome free-to-play business models on the Wii U. One of the earliest games announced for the system was Ubisoft’s free-to-play Ghost Recon Online. However, that project never actually launched on the system.



Nintendo’s Miyamoto: All this talk about our earnings is “silly”

The father of Mario stands by Satoru Iwata as CEO, explains why both 3DS and Wii U stumbled at launch, and hints at a Wii U Zelda reveal this year

Nintendo's Miyamoto

After a busy morning in which Shigeru Miyamoto joined other Nintendo developers to greet an assembled audience of journalists, encouraging them to check out Nintendo’s upcoming Wii U games, including Mario Kart 8, Super Mario 3D World, Pikmin 3, Donkey Kong Country: Tropical Freeze, The Wonderful 101 and more, GamesIndustry International had the pleasure of sitting down with the father of Mario, Donkey Kong and Zelda to discuss Nintendo’s E3 showing, why we didn’t see a brand-new Zelda for Wii U, the Wii U’s sales struggles, and whether he feels some of the same pressures as Nintendo CEO Satoru Iwata when it comes to the business side of things.

Creatively, however, Miyamoto, who serves as the general manager of Nintendo’s Entertainment Analysis and Development group, feels he still has plenty to offer. Although he joked that he may just one day “fall over,” the veteran designer stressed that he’s not “actively thinking about retirement.” Our full Q&A with the Nintendo legend follows below. Translation was provided by Nintendo’s Bill Trinen.

Q: There’s been a lot of talk about the other game companies here at E3, with a focus on Microsoft and Sony yesterday. Nintendo chose to not have its own press conference, to concentrate on the media coming to play the games, but what have you seen from the competition that you found interesting, or have you even paid attention to them?

Obviously we’ve been coming to E3 for many years now and one thing we always try to think of when we come to E3 is: how can we show what’s really unique about Nintendo? What you described about [the media being invited to play games] was really an effort to do something that was different and show what is truly unique about Nintendo through the games, because if all we’re doing is the exact same things the other companies are doing, you just all start to look the same and I really believe we have a lot of unique things to offer.

Q: Yesterday Sony announced a $399 price point for the PS4 and the Wii U has struggled a bit with its sales at the $349 price point. Does Sony’s announcement affect how Nintendo will look at its Wii U price? It would appear like the respective values of the platforms are not truly balanced…

“Development on the new Wii U Zelda game, we’ve pretty much determined our direction on that and the teams are working hard on that. In fact, we actually did consider showing it at E3 this year”


We don’t look at it as a competition in terms of price per se. Really, what we look at is we’re providing a complete system in terms of the GamePad, the system and a complete environment that everyone can interact with and enjoy the benefits of. Certainly if you’re a consumer – anytime you talk to a consumer about pricing, their answer is going to be, “Yes, I want to pay less.” But we have to compete in terms of our uniqueness and what Nintendo does that’s different from what the other systems have to offer. And as long as we do that, hopefully people will see the value of the system that we’re offering with the GamePad and the fun and unique gameplay, but I really don’t have anything that I can say at this point about what that may be in the future in terms of pricing.

Q: So Nintendo finally has a bunch of software coming for Wii U – it was a bit slow to build up from the launch – but it seems like Nintendo has some difficulty in lining up its development teams to bring out compelling software on time for hardware launches. Why did Nintendo struggle in the same way with Wii U as it did when it launched the 3DS? If the development teams you oversee know that a hardware launch is coming, should some of them be pushing to make sure the games are ready on time?

Well, obviously if you speak in terms of simple math you could say that Nintendo should just multiply its development team staff by four times and then everything would be fine, but unfortunately things aren’t quite that easy. Our focus is always on delivering the highest quality content, and simply increasing the development team size isn’t going to allow you to achieve the level of quality that we strive for. You really have to kind of bring those people up gradually and help teach them how to develop games in order to achieve that consistent quality level. So that’s one challenge that we’re always engaging with and one we’re progressing on.

mario kart

The other is a little bit coincidental in that the hardware jump from DS to 3DS was quite big in terms of the difference between those two [platforms] and it just so happens that that same scale of jump happened from Wii to Wii U, consecutively with those two pieces of hardware. And any time you have a big jump in the hardware technology it certainly takes the teams time to learn that and adjust their development environment in order to adapt to those big changes. So I think gradually as we’re adding more staff and we’re increasing our capabilities… and in the future as the hardware generation change doesn’t result in significant change in the hardware environment or capabilities of the hardware, then what ends up happening is you have a smoother transition, as you saw from the Gamecube to Wii.

Q: The one game many of us were anticipating to be announced today and that many fans have been looking for is a brand new Zelda on Wii U, apart from the Wind Waker HD makeover. Perhaps this is a better question for Aonuma-san, but why haven’t we heard about a new Wii U Zelda?

So it certainly is a better question for Mr. Aonuma but we are working on a new Wii U Zelda ,as we do whenever we work on a new hardware system. Development on the new Wii U Zelda game, we’ve pretty much determined our direction on that and the teams are working hard on that. In fact, we actually did consider showing it at E3 this year but we were worried that if we showed the new Wii U Zelda game then that would attract all of the focus, and really what we want people to be aware of and pay attention to here at E3 are the playable games like Pikmin 3 that we have coming in the immediate future, because a lot of fun is with the games that are coming out this year. So that’s why we decided not to show it this year at E3, but it’s certainly something people can look forward to.

Of course, as I’m sure you’re aware E3 used to be the place where you made all of your big announcements but as we’re seeing more and more, particularly with the advantages we have with the internet, we’re able to make announcements really at any time. So the other thing we didn’t want to do was go through all the news here at E3 – we wanted to be able to have some news to continue to share with consumers over time.

Q: So does that mean Nintendo will tell us more about the new Wii U Zelda later this year?

I think so, maybe. [Laughs] Maybe after we’ve seen enough people enjoying The Wind Waker HD, then we’ll think about sharing something with them about the new Wii U Zelda.

“I’m not actively thinking about retirement, but the thing is you look at my age and you have to naturally take into account that a time may come when I’m no longer there. And particularly at my age now, it wouldn’t be strange if I were to just one day fall over”


Q: One thing we’ve repeatedly heard a lot of people in the industry say, whether analysts or executives, is that Nintendo would be better off making games on all platforms. Why do they have to keep on making hardware? Wouldn’t they be able to be just as creative with their IP on tablets, and smartphones, and the PC. Nintendo could expand to a massive user base across the world. Would you see any advantage to doing that? And even if you ignore the business side, creatively would making a game on a smartphone or tablet appeal to you?

There’s two ways to look at it – one is from the business side and the other is from the creative side. From the business side, we really look at the fact that we have not only the software side of the business but also the hardware side of the business as sort of our sphere, as being very important to us. On the creative side, I think what people may not realize is we’re able to design the hardware the way we want so that our creative teams are able to work with that hardware design and create a piece of hardware that can meet our designers in order to create the games we want to create. So without that hardware side, then on the creative side we’re no longer able to do that. And so, from the multiplatform standpoint we do see a lot of developers who are developing the main game on a console and then they’ll have another team or group that’s working on another version or a different type of gameplay within that same franchise on different platforms. And so you end up having all of these different teams working essentially on what amounts to the one main game and the derivative versions of it, whereas at Nintendo what we’re able to do is we’re able to focus on the one title for the one platform and the development team is then able to move on to the next thing. So we see some pretty strong environmental advantages from that standpoint creatively.

Q: One of your contemporaries here in the US, Sid Meier, has talked to me about how much more actual design he can fit into a mobile game compared to a console game. He doesn’t have to worry about presentation as much and can iterate more on design and gameplay. Do you have a different view of mobile than Meier?

I guess I have a slightly different line of thinking, but to me the question really comes down to: what is the role of a game designer? My feeling is that the game designer’s role is to create fun and exciting new interactive experiences for people to play, but what we’re seeing is… as the graphics get more and more complex and they build up the production around the gameplay, then they tend to try to sell the game based more on the production rather than what the actual experience is. As a result of that you end up with the meaning of game design being weakened. Whereas from my perspective, as long as we’re focused on creating that core and essential gameplay then certainly I think with a game like Pikmin 3, it’s fine if you’re able to build up production value around that as long as you do it in a way where that core, fun, gameplay element still remains the essential part of what that game ends up being.

Q: I understand that you oversee a lot of game projects but you’re much more involved in Pikmin 3. Do you miss that? Do you want to be more involved in the game design of key projects more often?

So one of the things I want to do is be a little more clear in terms of my involvement in the projects. There are certainly projects I’m deeply involved in and one of those as an example is the museum guide we did for The Louvre in France. It was done on a Nintendo 3DS. That was one I was deeply involved in and Pikmin 3 is another. So there are the games I’m deeply involved in and then there are the games that I’m sort of keeping an eye on. So it’s two different categories. Particularly any time we’re doing something very fresh or new I want to be deeply involved in the design of those games.

Q: You’ve talked a little bit in interviews during the last couple years about retirement. Is that at all on your mind now, and whenever that day comes, do you feel confident that the designers who’ve been working with you will be able to continue making innovative products for Nintendo the way you have?

The one thing I want to say is I’m not actively thinking about retirement, but the thing is you look at my age and you have to naturally take into account that a time may come when I’m no longer there. And particularly at my age now, it wouldn’t be strange if I were to just one day fall over. [Laughs]

So what we’re doing is we’re approaching it from the stance that there may come a time when I’m not there and then the big question is: how do you ensure that you’ve trained the young staff in a way that will allow things to continue? And so that’s why we’ve been talking about the fact that sometimes when I’m working on a project with the teams, I say, “I’m not going to do anything; you have to do it all.” It’s really to try to push them to prepare themselves for when I may not be there. Also going forward, the additional approach that we’ll take is really more of me clearly defining the games that I’m deeply involved in versus just the ones that I’m keeping an eye on. Certainly, I think in the last few years we’ve done a really good job of raising up the younger designers and helping put them in a position that they’ll be able to carry things on even if I end up not being there anymore.


Q: Well, I certainly hope you don’t fall over!

Me too! [Laughs]

Q: You’ve achieved so much in your career already, but do you have any current goals or aspirations? Maybe there’s something you haven’t been able to achieve yet that you’d very much like to?

There aren’t any specific goals that I’m working towards and I say that because having been in the industry for 30 years, much of what’s happened is something that 30 years ago I never imagined would have occurred. So instead, the way that I perceive it is really being ready for that next wave and just seeing how good of a job or how actively I can dive into that wave when it comes and ride it and still come out on the other side. And it’s with each new wave that I stay focused on really trying to maintain an active role in how things are developing. So I don’t really have a clear end goal that I’m measuring myself against – it’s really more about riding the waves.

For me, it’s less about doing what other people are doing and really more about trying to see what I can do that’s different from everyone else, because entertainment is really about how can you surprise people with things that they aren’t expecting. If you’re doing the same thing as everyone else, then it won’t be surprising for people. So it’s always to me an exercise in how do I find something that’s new and unique that no one’s done before and bring that forward and present it in a way that will surprise them, and just repeating that process.

Q: The marketplace has changed a lot since the Wii was first launched. Developers now have lots of other options and more open platforms. Innovating on those platforms may be easier for some, but how do you feel about innovation now at Nintendo? Has it become more challenging to innovate since you launched the first Wii?

“So all of this talk of ‘Oh is Nintendo going to hit its numbers? Is Mr. Iwata responsible?’ and all these discussions I think are just silly ones to have because Mr. Iwata is managing our company and I don’t think there’s anyone better to manage it than him.”


We don’t really look at it as being challenging. I think where the challenge lies is with all of the hardware using relatively similar technology. Then what you end up with is a lot of the different companies really competing from a production standpoint; and the more you start to focus on making the graphics spectacular or making the sounds spectacular the more the things seem to look and feel very similar. So for us, the challenge is always what are we doing that’s different and unique and how can we differentiate ourselves from what the other companies are doing? That’s something we instill in our development teams and so that’s really where we’re putting our focus, and we find that for us, that process of innovating by finding things that no one else has done is actually quite fun.

Q: A lot of that innovation has come within existing franchises, and no one can blame Nintendo for repeatedly going back to its incredibly popular IP, but at the same time there is pressure from some people who want to know why Nintendo isn’t creating brand-new characters and IP. So creatively, when you’re starting up new projects, how do you decide whether to build a new IP or to try and innovate something new within one of Nintendo’s existing properties?

So this is actually a discussion that I think is tricky to balance, and certainly internally at Nintendo we have people on the teams who say, “Wouldn’t this be better if we created a new IP around it?” But to me, the question of new IP really isn’t whether or not [you have a new character]… I look at it from [the perspective of] what is the gameplay experience in the game you’re playing? For a lot of people, they would say if you take an old game and wrap a new character around it, that’s a new IP, but that game is still old, and the experience is still old. So what we’re doing is we’re always looking at what type of new gameplay experience can we create, and that’s the same for whether we’re playing with one of our existing IPs or we’re doing something new.

Pikmin 3 is a good example; the Pikmin characters were something that were born out of a new gameplay idea when we first came up with that game. We created the gameplay idea first and we decided that the best characters suited for that gameplay idea were Pikmin characters. That’s where the Pikmin IP came from. Similarly, if you look at our booth here, we’re showing it as a showcase of all of Nintendo’s great characters, but in each and every one of those games the gameplay experience is what’s new. So from my perspective, it’s not a question of just how can we create a new character and wrap it around an old game and put that out and call it a new IP. It’s always about starting with a new gameplay idea and a new experience that’s unique from an interactive standpoint and then finding a character that’s best suited with that. In some cases, it may be an existing character, and in some cases it may lead us to a new IP at some point in the future.

Q: With Nintendo missing its sales forecasts lately, do you personally feel some of the business pressures? There’s been some talk about Mr. Iwata and whether he can remain the CEO – does that ultimately affect you and your teams in terms of feeling like you have to do better to save his job?

Well, first of all, the entertainment industry is one that is inherently unstable and if people decide that they no longer need entertainment anymore then there’s no way for you to make money off of that. Because of the waves in the entertainment industry and the way the cycles move, personally I feel that aiming for a specific numerical goal is almost silly, and instead our focus should be on doing our best to create something that’s new and unique. So all of this talk of “Oh is Nintendo going to hit its numbers? Is Mr. Iwata responsible?” and all these discussions I think are just silly ones to have because Mr. Iwata is managing our company and I don’t think there’s anyone better to manage it than him.

So for me, I’m really focused on creating the most fun and unique experiences I can so that the entertainment can appeal to a very broad audience, and we’re having fun doing that. So certainly I think there are other industries where I think their chance to appeal to a broad audience has been lost, but I still think within our industry we have a lot of opportunity to do that.



Iwata backs quality over consistency as Wii U falters

Nintendo’s president says gaps in Wii U release schedule were due to a conscious choice for better products

Nintendo’s Satoru Iwata has attributed the Wii U’s loss of sales momentum to the company prioritising quality over consistency in its software

In a call with investors that followed Nintendo’s recent financial results, Iwata fielded numerous questions regarding the slow performance of the Wii U and the decision to make decisive changes to Nintendo’s management structure.

Iwata conceded that the Wii U’s sales have been adversely affected by its thin release schedule, but, he said, this was a deliberate choice by Nintendo – a choice rooted in the company’s values.

“We were faced with the alternatives of taking time to refine our products or launching them without too many intervals,” he said. “After careful consideration, we selected the first option because we believe that from a mid-and-long term perspective it is more important to improve customer satisfaction with each game.

“The future of the industry depends on the number of games developers release that consumers consider to be fresh and worth paying for”


Satoru Iwata, Nintendo

Iwata pointed to Fire Emblem: Awakening and Luigi’s Mansion 2: Dark Moon on the 3DS as examples of the sort of success that high standards on specific platforms can bring – and evidence that gamers still crave “carefully developed” experiences. The delayed Wii U games, including Pikmin 3, are merely subject to the same rigorous standards.

“I believe the future of the video game industry depends on the number of games developers release that consumers consider to be fresh and worth paying for,” Iwata said.

“We decided to take time to add the final touches to ensure that consumers fully feel that they are valuable titles. The brand of a franchise would be completely degraded without customer satisfaction. This is why we delayed the release schedule of such games [as Pikmin 3].”

When asked to identify any future bottlenecks in production – a strong possibility given the apparent lack of strong third-party enthusiasm for the Wii U – Iwata pressed the rising difficulty of creating $50 to $60 retail software that passes muster with modern consumers in terms of value. Games that once would have been successful are now judged in very different ways.

“These days it is becoming increasingly challenging to determine the minimum development resources required for customer satisfaction,” he said.

“However, the sales of popular games are much larger than in the past. Therefore, if we create more hit games, the software development business can still be very profitable. All games break even if they sell millions of copies worldwide, so we will continue to do our best to develop games which have high sales potential.”

Of course, in the digital world, it simply isn’t necessary to think in terms of $50 and $60, and Iwata pointed to evidence of Nintendo’s belated attempt to develop its online business: a quarter of Animal Crossing: New Leaf’s sales last fiscal year were digital, as were 10 per cent of sales for the recently released Tomodachi Collection.

In an encouraging development, Nintendo’s research indicates that, among people who bought a game via download, substantially more than half also made their next purchase as a download.