Nintendo Takes Mobile More Seriously, Considers New Business Structure
January 20, 2014 7:47 PM
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This comes after revisions to its sales and profit through March 2014
Nintendo's new year hasn't been too forgiving, as the company was forced to
revise its sales and profit expectations
through March. With hard times ahead, the company is realizing that it needs to hop on the mobile bandwagon if it wants to stay alive.
, Nintendo is considering a new business structure that includes launching games on smart devices such as tablets and smartphones.
“We are thinking about a new business structure,” said Satoru Iwata, Nintendo CEO. “Given the expansion of smart devices, we are naturally studying how smart devices can be used to grow the game-player business. It’s not as simple as enabling Mario to move on a smartphone.”
This could be a good move for Nintendo, considering hardcore console gamers tend to stick with Sony's PlayStation or Microsoft's Xbox consoles while more casual gamers have flocked to mobile devices -- not to mention that almost everyone now carries at least a smartphone on their person.
Nintendo has also been pretty stubborn about offering its characters to online mobile games, which the company could profit off of.
But times are getting tight for Nintendo, and it's realizing that if it doesn't make some big changes, it'll sink.
Earlier this month, a statement from
announced that its anticipated Wii U units sold from April 2013 to March 2014 was changed from a previous 9 million to just 2.8 million. This represents a staggering 69 percent drop.
Wii U software doesn't look any better, with sales expectations falling from a previously reported 38 million to just 19 million.
The company also had to revise 3DS sales expectations, dropping from 18 million to just 13.5 million units sold. As for the original Wiis, Nintendo is cutting their sales expectations from a previous 2 million to 1.2 million.
With so many sales revisions, Nintendo is also decreasing its financial forecast, which includes a loss of 25 billion yen ($240 million USD) -- down from a previously reported 55 billion yen profit.
Iwata said the company was unable to take advantage of the weaker yen. Nintendo decreased its planned dividend for the fiscal year from 260 yen to 100 yen. Nintendo revised its foreign-exchange predictions from 90 yen to the dollar to 100 yen, and from 120 yen per euro to 140 yen.
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RE: Nintendo is fine
1/21/2014 9:50:34 PM
You're kidding right? You go from expecting a 550mil PROFIT to a 250mil loss and 70% off of hardware sales after only a year? You call this doing fine? Stop making me laugh :) Not it was off 50% last time they spoke about the numbers. This is just getting worse. Will it be an 80% revision next time? 90%? You can't really call that insane with it going from 50-70% in just 6 months. The 50% drop just after xmas was bad enough. Jeez. Mobile is killing them because they are not even xbox360 and they have been caught. xbox1/ps4 are next as they get caught the same will happen. Love consoles or hate them reality isn't going to change here. If they had shot higher with the hardware maybe they would have had a better chance. But upscaling already, etc isn't helping the picture here. MS keyed so much on TV experience they seem to have forgotten you sell GAMES. Worse. They have done everything they could to bury their recent devices. Surface RT1 used 1.4ghz when 1.7 T3 was out in a phone already, why so high price and so low perf? These socs go for $20-25 so how much more expensive was the faster version? $3? Stupid to get reviews saying it's sluggish over a few dollars. Xbox1 will have the same issues, which is why PS4 is outselling it (if not because they are just more gaming oriented it seems where MS believes it's a TV box not a GAME box).
Mobile will kill consoles in 3yrs. Intel will have a 10nm soc in 2015, or 2016 at worst. Krzanich says 2015, but I think he means themselves shipping a chip, not a device we can buy, which is why I say 2016. The 14nm is supposed to up gpu side 15x, so what is the 10nm expected to do. It's clear Intel has no fear of AMD now, so will go total gpu for die shrinks now (which is why we get 5-10% on cpu now). If every tablet and phone has a xbox1/ps4 in them 2-3yrs into the brand new consoles lives, how will they sell with 1000's more games and all game dev attention on mobile? How do you decide as a dev to concentrate on 10-15mil consoles each (if they get to that each this year, xmas was good but watch for wiiu like declines this year) when you can instead concentrate on 1.2B units YEARLY sold and every year getting faster on mobile. With 100x the size of the audience even next xmas (you have to program for both consoles), why wouldn't you just make an opengl game on pc that scales down to android's power now that it's running a desktop gpu with K1 soon?
All PC games and PS3/PS4 games that are OpenGL (pretty much all unreal engine games etc can go OpenGL) can now be ported easily. Unreal 3 engine, ported in 4 days. Trine2 and Serious Sam 3 ported to K1 in 2 weeks with most of that according to anandtech going to mapping functions not the programming itself so clearly porting is a piece of cake now as long as you aren't coming from directx.
Devs showing 60% making mobile games, less than 12% for next gen consoles. Now factor in the 1.2B becoming 2.5Bil by 2016 and you get an even worse number. Consoles are dead this gen, and I'll be shocked if they get through the next year without showing signs of weakness. It's not going to be xmas for the next 4 quarters in a row. They had big pent up demand from hardcore people, but the pre-orders are over. GDC2014 in march will show numbers shifting even more to mobile. Epic has said they made more dollars per man hour spent on Infinity Blade (just for iOS mind you, no android) than they did for the gears of war series...
How small is Apples ios market compared to android? You can charge $10-20 for these games and dwarf console sales. Get the hardcore users with a pc version for $40 and the rest at $20 on mobile and laugh your way to the bank while consoles die. Devs don't care who wins, they go where the people are. We go where the devs went with games. Consoles are chicken egg syndrome for the first 2yrs. You have to sell enough hardware or nobody wants to right software for it (see wiiu sales, vita sales). Mobile on the other hand, sells 1.2B units already every single year! 950mil phones now, and 300mil tablets (1.25B units I guess). K1 this year, M1 next year, and V1 2016 (volta, on die mem etc). By then consoles are caught even if it isn't Intel's process that does it. So consoles MIGHT have 20-30mil each in the bag, while mobile will ship 2.5B units that are either equal or "GOOD ENOUGH" for most people and all have hdmi out by then (most do now). We already have 4GB samsung modules coming for mobile this year probably, and by 2016 I'm sure that will be 8GB and 64bit coming this year too. How do you compete with even todays 1.2B units shipped yearly? K1 is already basically xbox360/ps3 power shortly.
Google/Nvidia/Samsung should just band together and pay for the porting of any PS3/PS4 or PC game they can to mobile/gamepads. Pay the porting and tell them they can have all the profits. Do it for a year or two (google/samsung/NV all push in 500mil each or something) to get the ball further in your court before consoles get enough out the door to even be worth pondering a game for them. They can easily speed up the train. You seem to be ignoring reality. Nintendo isn't looking at mobile because consoles are awesome. They are looking because consoles (for them anyway) are about to be killed. $250mil losses are not a way to stay in business. Go mobile/PC or die. Nintendo doesn't have to sell hardware to be a great company. Their franchises will sell on any platform.
Think about the next Zelda only being on mobile/pc...LOL. $20 x 5% of the market would net you 1B on a single game which probably wouldn't cost more than 20mil to make. Not doing this is stupid. A stupid game like angry birds has made Rovio a few hundred million already. Now multiply that by all their great next titles if they did this. I'd rather make a Billion or two instead of a $250mil loss. Clearly they think the same to some extent. Hard to just ditch your hardware, but logic says they should.
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