Q: As someone who’s made a pretty significant investment in digital purchases for 3DS, I feel there may be some games that work better on 2DS than on 3DS — Virtual Console, for instance. But the 3DS games that have 3D functionality, I’d rather keep them on the 3DS. It’s not really possible to do that…
Scott Moffitt: It’s not tied to an account. Yeah. We haven’t solved that yet.
Q: Are you working on solving it? It sounds like, to date, Nintendo has been pretty content to keep things as they are.
Scott Moffitt: If you look at the account system, the network ID system that exists now on Wii U, that’s an effort for us to move beyond a device-centric approach to an account-centric approach. But we haven’t done it on the handheld side of the business at this point. We hear that feedback. We hear that criticism, or whatever you want to call it, from time to time. We’re not blind to it. But it’s not something we’ve solved.
Q: I feel like this device forces the issue.
Scott Moffitt: Yeah. I would just challenge… If you have a 3DS and you enjoy playing it there on a bigger screen… I wouldn’t think we would expect you to be part of the buyer base.
“A lot of it is driven by wanting to achieve a price point that is more accessible for consumers…Removing the 3D capability allowed us to get to a better price point”
Q: Well, like I said, if I’m playing NES games or New Super Mario Bros., that sort of thing, I can already tell just by holding this…
Scott Moffitt: It feels more familiar to you?
Q: Playing those games on 3DS, the D-pad and button placement isn’t ideal. So I could see some people wanting to carry over part of their library to this and have dual devices, the way you can own an iPhone and an iPad and still share content between those devices.
Scott Moffitt: Yeah. I guess all I can say is that you weren’t directly in our crosshairs as we were assessing the market potential for this initiative. You never can guess who’s going to respond to a new piece of hardware.
But I think our expectation was that we were primarily trying to address the value barrier that might exist for some consumers to playing a 3DS. They could be DS owners that haven’t yet upgraded to the 3DS because of price and because they love playing their old DS games. It could be young kids just entering the video game market, and parents not wanting to buy them a $200 gaming system. Now we’re much closer to $100, which makes it much more affordable for them. I think that was probably the audience we expected or intended to design the unit for. But I think it’s good feedback.
Q: Will you still be selling the original DS?
Scott Moffitt: The original DS? Yes, the original DS, that’s $99. The DS still exists, so it’s really four [items in the lineup]. Certainly our emphasis and our priority is on the 3DS platform. That’s where we’ve made our commitment. That’s our future. So we are not developing gaming content for DS at this point. Our resources are focused on 3DS. But that’ll still be in the lineup, yes.
Q: I was wondering if you could talk a bit about the form factor of the system. It actually seems kind of surprisingly large. It’s even bigger than an XL. It’s definitely thinner, but still not super thin.
Who knew that ‘Plays games in 2D’ would be box art worthy one day?
Scott Moffitt: It’s lighter weight, though.
Q: Yeah. I was wondering if you could just talk a bit about the thinking behind the specific hardware layout and configuration.
Scott Moffitt: A lot of it is driven by wanting to achieve a price point that is more accessible for consumers. The 3DS screen is a fairly expensive piece of equipment that’s built into the system. Removing the 3D capability allowed us to get to a better price point. The hinged clamshell design is also an issue.
There’s a carrying case that’s sold that allows you to pop that into a backpack or throw it in a suitcase if you’re on the road or getting in the car or if you just want to carry it with you. That, we think, is probably the predominant way that consumers might carry it around. I don’t think kids would carry it around in their pocket that often now anyway. I think that’s what went into the design. How can we achieve the price point in the most economical manner?
Q: So for handhelds, you’re saying portability isn’t as much as a factor as it used to be?
Scott Moffitt: No, I think portability is still a factor. My point is just that I don’t think kids fold it and put it in their pocket very often. This shouldn’t be any less portable than a base 3DS or a DS today. But portability is clearly important.
Q: You referred to this as a “slate” form factor. Could you talk a little more about that?
Scott Moffitt: It’s molded open, so it’s not a clamshell design like we’ve had in previous years. Certainly that form factor is reminiscent of some of the products we’ve had in our lineup in the early days. It’s a form factor that we’ve sold and launched and had great success with before. I don’t think there’s anything more that inspired it other than that we’ve done these kinds of systems before. We know how to create them, we know how to design them, we know how to make them work.
Q: The removal of the 3D visualization — is that an admission that 3D wasn’t really that big a deal to begin with?
Scott Moffitt: Not at all. Clearly our development efforts all include 3D games. Our installed base, we have eight million units installed. If 3D wasn’t selling and wasn’t part of our future, we wouldn’t be seeing and enjoying the robust sales we have on 3DS right now. I think you know that the 3DS is the number one gaming platform on the market. We’re having a very good year with 3DS. Our games continue to sell extremely well. Our forecast for pretty much everything we’ve launched this year has surprised us on the positive side. We’ve been very happy with the 3DS part of our business. This is really all about addressing that next opportunity in the US market.
“There’s a lot of great 3D experiences that gamers have come to love. We don’t want to walk away from that at all”
Q: Right. What I’m saying is not that the 3DS isn’t a viable platform, because obviously it’s doing really well. But the 3D aspect of it specifically… That’s what was trumpeted at the rollout of the system. “Hey, you don’t have to wear glasses, you’ve got 3D.” But here’s the same system and the same games, minus the 3D. The message that it seems to be sending to me is, “Yeah, it’s fine, you don’t need the 3D for these games. They’re still fun.”
Scott Moffitt: Not at all. I’d say that our fan feedback, gamer feedback, has been that they very much enjoy 3D as a feature. Games like Super Mario 3D Land play fabulously well in 3D. There’s a lot of great 3D experiences that gamers have come to love. We don’t want to walk away from that at all.
They also will play well in 2D, and it allows us to get to a price point that we couldn’t get to with the 3D screen. If we can get to that in another way… If you’re asking me if we could get to a price point of $129 with 3D functionality, it didn’t look like it was possible. That’s the reason. It’s less about wanting to have 3D in and it’s more about trying to get to the value price point that’s going to allow us to open up that next part of the market.
Q: I get that, but the outside perception may be that you guys are backpedaling on something that you presented as a really major feature for the system. There will be people who regard it that way, who would look at this and say, “Why did they even bother putting 3D in the system in the first place?”
Scott Moffitt: People may see it that way. I just think it’s a misread of the situation. I don’t think that’s an accurate characterization of our commitment to 3D and our belief that it adds something new and exciting to the world of gaming.
Q: I feel the design of this device is somewhat compromised by the need to maintain consistency with the 3DS’ two screens. I think people will look at a device this size and this form factor and expect something more like a Galaxy phone or an iPad mini. They expect a lot more screen real estate than you’re actually giving them. This device obviously doesn’t exist in a vacuum. There will be these outside factors that people are going to be weighing against. Obviously this is cheaper than a Galaxy phone, but…
Scott Moffitt: I understand your point. I guess I appreciate that perspective. The big difference, to me, is that with a phone, you’re making a compromise the other way. You’re making a compromise in button control and the ability to play games in a manner that’s been pretty successful, pretty popular over many years. You’re asking, could we make the whole thing a touch screen and use all the real estate for the screen? That would negate that magic of all the things that we’ve done with creating great button control and great experiences with button control.
Q: So is this as close as we can expect to see Nintendo get to the tablet market?
Scott Moffitt: [chuckles] Well, it’s not at all inspired by… I guess some would make that comparison. But it’s not meant to be a tablet. It’s not a response to a tablet at all. Again, the idea is, how can we continue to expand the world of portable gaming? One of the ways to expand it, as we saw in the DS history, was creating a more affordable price point that opens up a new part of the market. That’s the real intention.
The form factor fell out of that, of that design specification, to create a gaming device that plays all of our great content, that doesn’t lose any of the StreetPass or SpotPass or all the other fun features that people enjoy with the 3DS, but create it at a price point. Our hardware designers came up with this design. So I’d be surprised if there’s any connection or any inspiration from the tablet market.
Q: At the same time, I still can see a similarity. I look at the original DS, and I look at the existing tablet market, and a big part of the appeal for both is that they have offered experiences that aren’t strictly video games. Will you be encouraging developers to take 3DS software in a direction more like applications and that sort of thing?
Scott Moffitt: There’s already some of that today.
Q: Some, but not nearly as many as there were for the DS.
Scott Moffitt: Yeah, and certainly not as many as there are for an iPhone. There are non-game entertainment experiences. Nintendo Video is one good example, the ability to access and play [videos]… Those kinds of experiences, I think, are great. We’re a game company, we’re an entertainment company, so I think… If we have an hour of consumers’ time and they want some entertainment, they want some enjoyment from one of our games, we’d rather they play a game than an application. But certainly the ability to access video or other entertainment content exists on the platform.
Q: Will we see any special software for it? You said there’s no Pokémon bundle, but…
“Sony I believe seems to have a different kind of strategy… clearly the PS Vita’s sales wouldn’t suggest that they’ve found something that we haven’t discovered”
Scott Moffitt: The launch date is coincidental… The thinking behind that is that with new software, we’d like to have other news around it. That’s going to be a massive hardware driver. We don’t want anyone to not be able to play Pokémon X and Y because they haven’t bought the hardware. If price was a barrier for some of those people, now we’ve opened up the door for them to say, “Okay, great, I can play the first Pokémon for 3DS on this new device.”
Q: I look at this and I definitely see some similarities in terms of layout and the overall form factor with the Wii U GamePad. Isn’t that a bit of a missed opportunity? Shouldn’t one device be able to work as the portable system and as the Wii U GamePad?
Scott Moffitt: The Wii U GamePad is intrinsically tied to the console. It was never intended as a portable device. It does allow, because of its form factor and portability, for interesting gameplay within the living room. But it’s really meant to be in-home. These are designed from the ground up to be played in-home also — we know there’s a lot of in-home DS play and 3DS play – but also to be portable, to go wherever you want them.
We do think that the type of gaming experiences that consumers want are different between at-home gaming occasions and away-from-home gaming occasions. Away from home, you’re not going to grab a bag of Doritos and a big drink and sit there for three hours. When you’re away from home you’re going to play shorter games, and so we think that with different experiences, the form factor and the game design should all reflect that, that belief. And I think they do.
Q: Well, I’m specifically thinking about how Sony is using the Vita as their equivalent of the GamePad.
Scott Moffitt: Yeah. Commenting specifically on that, Sony I believe seems to have a different kind of strategy. They believe that the away-from-home gaming occasion and the at-home gaming occasion are pretty similar in that way, and that what people want outside the home is to continue the play of their home games. We just don’t believe that. So we have a different belief — a different strategy — as far as what we believe consumers want. It doesn’t mean one is right or wrong, but clearly the PS Vita’s sales wouldn’t suggest that they’ve found something that we haven’t discovered.