Nintendo's Game Plan
Next-Gen: Earlier this week, Reggie [Fils-Aime, President of Nintendo America] had talked about getting serious about online. Sure, there are a lot of online gamers using Wi-Fi Connect, but I look at things that Sony and Microsoft are doing with their online programs, where they're really creating communities and focusing on user-generated content on top of multiplayer online. Where is Nintendo as far as that goes in regards to Wii? Right now we've only seen a few multiplayer online games like Mario Strikers Charged and Mario Kart Wii.
Harrison: Yes, they're mostly competitive type games...I think our first project was trying to open up that online gameplay itself to all the publishers and have a variety of those kinds of experiences. The other thing that was important that we just announced recently was WiiWare, so developers can get underway doing some new content and it can be downloaded online. That will come probably I would say in early 2008. It just depends on how long it takes them to get going.
How has the developer reaction been to WiiWare?
It's very strong. I think there's a lot of outlets that people want to find for creativity that aren't necessarily going to justify going to a publisher and having a retail sale of a product. You've got to do 200-500,000 units of a product to be able to justify [a published retail game]. But a developer may just have an idea they're working or a character they want to try out to see if it has appeal. So we think it's going to be a really good outlet for them.
So it'll be games that aren't ready for retail?
Or just types of gameplay and to see if there's enough there. It's really wide open for experimentation so people can do most anything with it.
I just would like to get a better grasp of where Nintendo's going with online, because to me it seems that that's where everything is, from distribution to online play to community. I see other companies really pushing that whereas Nintendo, as they did last generation, is still kind of sitting back playing wait-and-see. Is that the kind of attitude you're taking towards online?
Well certainly we tried to figure out when would be the right time to jump in, and we really didn't believe in the last generation that it would turn out right for us with Nintendo Gamecube. So for us, online's going to be always one of those things that's peripheral to gaming. We heard Microsoft talking about how many movies they've downloaded and things like that. That's not really our business though, competing with Comcast cable boxes and that type of thing. So the things we do online are going to be related to gaming, and most of its going to be around competitive type gameplay.
There's the ongoing debate where people, including competitors, say that the Wii has no legs or longevity. At the Nintendo press conference, Reggie said he'd be making the same argument if he were in competitors' shoes and that implies that critics are saying that because they're basically scared or surprised of Nintendo's success. But do you think that that argument has absolutely no merit whatsoever?
Well I think it's still hard for many people to sort of change the way they judge our industry. Our industry has been judged for more than a decade based on who had the fastest processor and the prettiest graphics. The same thinking went into the new launch of the PSP. "Oh, it's going to kill you, it's going to put GameBoy out of business, it's going to kill the Nintendo DS," and exactly the opposite has happened. PSP sales this year are down versus last year and [Sony's] whole premise was incredible graphics and a console game in your hand and it turned out to be that wasn't exactly what people wanted. And so we're trying to sort of follow our instinct and develop for the consumers and not just get trapped in the industry thing, which is [the belief that] you have to have the faster processor and prettier graphics, and you have to be a multifunctional machine that plays movies and other kinds of things.
So basically that argument in your opinion is unfounded in regards to the Wii?
Well not unfounded, but it starts with a premise based on one particular audience and that may be the European audience. But fans of gaming and existing gamers really like certain types of things. If you're playing a Madden Football game, you want pretty graphics, which we certainly can do on the Wii, but there's a whole bunch of other people out there who don't play videogames. They're just as viable a market, and that's where we decided to try and grow our business rather than go head-to-head with Microsoft and Sony in terms of who has the prettiest graphics and the most pixels, and things like that.
At the Nintendo conference, Mr. Fils-Aime called the DS a "beacon of light" for the entire games industry. That's a big statement. Can you expand on what Nintendo means by that?
Yes, it could be a beacon of light. The progress that we've made with the DS really shows what the potential is for Wii. Now is it easy to get someone who's 45 or 50 years old DS owner to go play a Wii console? Well it's not easy, but with things like Wii Sports -- and we're hoping with Wii Fit and things of that nature -- that we can do that. So the fact that we're getting people engaged in some form of interactive entertainment with the DS makes us optimistic for the Wii itself. We can get many more people in the household engaged.
The Wii does appeal to hardcore and casual with the types of games that come out, but I think a lot of the hardcore appeal relies on the characters that people grew up with -- the franchises that the hardcore gamers are still going to love like Mario and things that come out like that.
The appeal of Smash Brothers is an example of that.
Yeah. Are there games coming out, though, that are new IPs that will be appealing to the more core gamer?
Well some of that may come actually from the publishers as well. One of the things that we've put a lot of emphasis on with Wii, that was a problem of course with GameCube, is we didn't have the publisher support, so quickly after the launch of GameCube, we didn't have enough publisher support.
In the case of Wii we spent a lot more time cultivating [publishers], showing them not only that it was easy to make games for the Wii, but they could actually do some unique things and sell their games to different people by supporting the Wii. So at this point we feel great about it. When we see companies like EA and Activision and Ubisoft doing tons of projects for us, that's what's really going to set us up. There will always be some kinds of games that Nintendo ourselves aren't good at making. We are very good at making the character-based games, the Mario and Donkey Kong, Zelda and those types of things, but there are other types that we don't make. We need Capcom to do Resident Evil and we need EA to do Madden and sports and those types of things.
And you need Take-Two to do games like Manhunt 2, too.
Well, yeah. Take-Two does a certain type of game. I'm sure in the last generation Take-Two didn't even think to bring Grand Theft Auto to a Nintendo system, it didn't make sense. They didn't believe that we had an audience for it. What we had to do is go out and convince pretty much every publisher that there's a unique opportunity on Wii.
When do you think we're going to see a high penetration of third party titles really moving toward the upper sales ranks on Wii?
Well I think Reggie said [at Nintendo's press conference] that since the launch of Wii, out of the top 20 sellers, 14 of them are from third parties. We've always sort of heard that third parties feel like they can't compete with Nintendo titles because they're quality, well-known names, whether it's a Zelda or Mario. But the truth is, third parties can compete. If they put the time and the effort to find something unique in there and commit themselves, they can compete very, very well.
Again if we get the audience broad enough, there's going to be niches that Nintendo can't fill, and we can't produce enough games ourselves to fill up every month of the year, so there's plenty of opportunity there. With Wii, though, I think they can't just kind of phone it in like in the old age of ports, where you just did one product and sort of ported it over on every system. Publishers didn't get any incremental benefit from moving a game onto, say, Gamecube, but now that they're doing some neat things with the play control of the Wii, they really are seeing some incremental difference.
So in your opinion, the idea that third parties have trouble competing with first parties on Nintendo platforms is simply a misconception that you've been trying to shake since the Gamecube?
Well, I think it's a misconception, and to be honest with you, [we had] to change some of our habits too. We can always really aggressively court the third parties in terms of giving early peeks at the development kits. So we saw last year Ubisoft, they worked on Red Steel quite a while before the Wii hardware was finalized. They took quite a big risk and they went down that road with us, but now they're in better shape in terms of understanding the hardware, and now they're just looking forward. People like EA are supporting us now in a way that they haven't for many years. It used to be that they didn't always believe that our systems were in sync with their product strategies. They've redone some of their internal organization to be able to focus on DS, where they used to always pawn that development out. So we're very encouraged.
We need sort of the best and the brightest, not just to bring their games to our systems, but also to think completely different. You know EA told us at one point that it's hard for someone who's a 25-year-old product developer to put their mind in the mind of a 35-year-old housewife. How do I make a game for her? I don't even understand her. And so I think they've had kind of a renaissance of creativity and we were very pleased to see some of the comments that John Riccitiello was making in interviews this week. He said we actually have this big audience out there that we had not been chasing and we intend to go get it.
As far as the whole relationship between Nintendo and third parties goes, even you admit that Nintendo gave them the cold shoulder in past generations. Why the change of attitude?
Well, I think there was a recognition. If you start back in the late '80s with the overwhelming success of the Nintendo Entertainment System, we were the only game and the only system in town, so the third parties kind of had to work with us. That began to change over the course of the '90s, as they had competitive options, particularly when the PlayStation came along and they were working on CD as opposed to cartridge. The economics sort of went against us there but we still acted as though [third parties] had to do games for us.
I think a combination of realizing that there was a symbiotic relationship there spawned a willingness to go out and give them more support and more tools and to show them how to add special aspects to their games to make them stand out. It's really been helpful because one of the things we take pride in our developer support. Miyamoto looks at some of the games from some of the top publishers and gives his advice. That's been very powerful for us in helping them feel like they can get a lot from us as well as be successful.