Nintendo president Satoru Iwata has revealed that the company is looking beyond digital distribution and is actively thinking about free-to-play games. Iwata says that Nintendo is constantly thinking about current and new business models to bring in new streams of revenue.
Q: You talked about Nintendo’s digital business in the presentation. I remember you said that in addition to the packaged software business, the digital business could be a core business for Nintendo. Could you please give an indication as to how much you expect to generate in digital sales this fiscal year and the next? Also, apart from replacing packaged distribution with digital distribution, I understand that you are developing network-based products such as “Wii Street U powered by Google.” Do you expect to be able to make hit network-based products and create a buzz in society?
A: Also, as you pointed out, we think that digital distribution of packaged software is only the first step in expanding our digital business. We will not simply change our existing packaged software distribution channel. Rather, we might have many other types of business models in addition to packaged software. For example, we might see more games that are similar to free-to-play games, games that cost much less or games that require a monthly subscription fee. Digitalization allows for greater flexibility, whereby having more ways to make payments, both software developers and consumers have more options. And Nintendo 3DS and Wii U have flexible systems to handle such trends, so it is now a question of putting these ideas into action. I can definitely say that Nintendo will make new offers that go well beyond simply replacing packaged software with digital software.