We all know that Nintendo has teamed up with DeNA to produce video games for smartphones and tablets which will be released on the marketplace later this year. Nintendo president Satoru Iwata says that the company will be responsible when it comes to microtransactions as they do not want to damage either the IP or the brand. Some games will supposedly be free with microtransactions and some will be available for a fixed price. Nintendo and DeNA will work out what works best and will devise their own strategy.
Will you pursue a premium strategy where you charge users up front for games? Or will you offer free-to-play and try to capitalize on in-app purchases?
I understand that, unlike the package model for dedicated game systems, the free-to-start type of business model is more widely adopted for games on smart devices, and the free-to-start model will naturally be an option for us to consider. On the other hand, even in the world of smart device apps, the business model continues to change. Accordingly, for each title, we will discuss with DeNA and decide the most appropriate payment method. So, specifically to your question, both can be options, and if a new Nintendo-like invention comes of it, then all the better.
On the other hand, Nintendo does not intend to choose payment methods that may hurt Nintendo’s brand image or our IP, which parents feel comfortable letting their children play with. Also, it’s even more important for us to consider how we can get as many people around the world as possible to play Nintendo smart device apps, rather than to consider which payment system will earn the most money.
Data provided by Futuresource Consulting shows that tablets are now the gaming format of choice for children in the United Kingdom. For the first time they have overtaken the Nintendo 3DS as the most popular personal games device owned by children in the UK. A staggering 44% of UK children aged between three and twelve own a tablet. 30% of children aged three to four also own one. The report also says that tablets are the next thing that parents will purchase for their children, ahead of smartphones and dedicated handhelds.
Popular US video game retailer GameStop has announced that it plans to increase its focus on both smartphones and tablets, rather than video games. GameStop CEO Paul Raines calls the bold new move “GameStop 3.0.” Raines says the company will close around 2% of its current retail stores. GameStop will be opening Spring Mobile and Simply Mac stores instead. Spring Mobile will cover AT&T-branded phones and Simply Mac covers Apple products. They will open over 200 Spring Mobile stores and 20 Simply Mac stores.
Seth Fischer, who is one of Asia’s best-known hedge fund managers, has written to Nintendo to demand that the company begins developing and selling games on Apple’s iOS and Google’s Android. Candy Crush Saga developer King managed to generate $1.9 billion in revenues in 2013, or $5 million a day. Fischer says that Nintendo arguably has the largest library of casual games so they would be well suited to smartphone and tablet based gaming.
“Nintendo needs to embrace this thematic change in consumer demand, behaviour and expectations to stay relevant,”
“It is readily apparent that the standard elasticity of demand principle no longer applies in the consumer entertainment market when access requires the purchase of a physical product.”
“As the holder of what is arguably the largest library of casual games, Nintendo is well placed to make an immediate entry into mobile”
Thanks, Nintendo Commander Quadraxis
Nintendo president Satoru Iwata has told The Wall Street Journal that the company has no intention of making its key titles available on tablets and smartphones over fears it will damage the brand and also impact on Nintendo 3DS sales.
“The spread of smart devices does not spell the end of game consoles. It’s not that simple,” President Satoru Iwata said at a news conference Friday. The key is to figure out a way to use smartphones to make people aware of Nintendo’s games, and encourage them to try out the console version of the games, Mr. Iwata said.
“It doesn’t mean that we should put Mario on smartphones,” he said.
In the meantime, it is worth noting that Nintendo is beefing up its research and development budget, and that Mr. Iwata promises to surprise game players in the future. While there are plenty of unknowns, Nintendo isn’t saying game over to consoles just yet.
Nintendo of America president Reggie Fils-Aime has stated that the company is experimenting with smartphones and tablets, but this is really being done to market their content for their consoles and handhelds. However, Reggie says that Nintendo firmly believes that Nintendo games are best played and best enjoyed on their devices, and so the full game play will only be on Nintendo devices.
“It’s a topic that comes up all the time. It’s a debate that’s constantly had. We recognise that there are a lot of smartphones and tablets out there, and so what we’re doing is we’re being very smart in how we use these devices as marketing tools for our content.”
“We’re also doing a lot of experimentation of what I would call the little experiences you can have on your smartphone and tablet that will drive you back to your Nintendo hardware. It’s largely going to be much more marketing activity-oriented, but we’ve done little things where there’s some element of gameplay – a movement, a shaking, something like that.”
We already know that investors are demanding Nintendo to jump onboard the smartphone and tablet bandwagon, but Reggie says that the company is currently thinking about how to leverage popular mobile platforms for marketing purposes. Reggie explained that Nintendo is mainly considering how they can give tablet and smartphone users little experiences which then drive them back to the Nintendo 3DS or Wii U.
“We’re constantly thinking about how to leverage mobile as a marketing vehicle. How do I give little tastes of content, little experiences that then drive the consumer back to my hardware environment?”
“That’s why we’re so focused on having content exclusive to our platform,” he said. “When the consumer wants to play Mario, Zelda, and Pokemon, they have to purchase our hardware to do so. And that preserves our overall financial model.”