Some Nintendo What Ifs

[Powderkeg]

If they are going to the NES strategy they won´t fail.

I think they'll have a little trouble with the "We don't have any competition so anything we release will be a hit" strategy against the 360 and PS3.

 

[Teasy]

What I mean by fails is Nintendo doesn't sell enough to make it profitable. They take a loss in the console market.

So your question was "If Nintendo somehow weren't profitable at all with there next console would it be more profitable for them to be a third party". Well yes obviously it would. Just like it would be more profitable for Sony if they somehow didn't make any money from PS3. But its kind of a silly question isn't it? Just about anything they wanted to do would be more profitable then no profit at all.

 

[Urian]

You asked if Nintendo would make more money from going third party. That is unanswerable within the "If Revolution fails" hypothetical. Therefore I assumed you meant it as a separate question, otherwise it makes no sense to ask. After all how can anyone answer "Would Nintendo make more money from being third party compared to failing with Revolution" when we have no idea what you mean by "failing"? We have no statistics or sales to use to make a judgment. So no my argument didn't fall apart

BTW didn't GameCube fail in your opinion?

The key isn´t the third partie support.

The key is the exclusive third partie support.

 

[Powderkeg]

So your question was "If Nintendo somehow weren't profitable at all with there next console would it be more profitable for them to be a third party". Well yes obviously it would, just like it would be more profitable for Sony if they somehow didn't make any money from PS3. But its kind of a silly question isn't it?

The second question was rhetorical, made to make a point.

 

[Teasy]

Think you misread my post Urian. I was talking about Nintendo becoming a third party, not third party support for a Nintendo console.

 

[Readykilowatt]

If they are going to the NES strategy they won´t fail.

Nothing is guaranteed, however if the Revolution fails to make money then Nintendo will just lick their wounds and try again.

 

[Teasy]

There are over 120 million non-Nintendo consoles sold this generation. If only 5% were to buy any single Nintendo game, it would still be the best selling Nintendo console game in the past 5 years. Even if only 1% bought a specific Nintendo game, it would still rank in their top 10 in sales.

There are 90 million PS2 owners and 20 million XBox owners. But some of those people will own both a PS2 and XBox so the number is likely closer to 100 million. Also some of those PS2/XBox owners will already own a GC. So there's likely around 90 million current console gamers who don't own a GC (110 million current gen console gamers in total). That's a lot of gamers, but is it enough to sell 120 million extra Nintendo games? (on top of another 60 million from the Nintendo fans)? Because that's what would be needed to even match the profit Nintendo made from GC.

 

[Ty]

Yes. Keep in mind that the Gamecube has not yet been discontinued.

Definitely true and I would expect the next Zelda to do quite well. I don't know of other titles that will really bring in money though. Witness Nintendo downgrading because they admit GCN is dropping off rapidly. (Profits are still on target but due to other sectors for them).

Yep and the hardware itself is profitable.

Well we're comparing "Profit from GCN" to "Profit from going multiplatform" - not is the GCN profitable at all.

To be honest when you look at the game sales on the system and consider the costs the question then becomes how could it not be profitable?

That's not the question I asked though. We need to compare (as you are attempting to do later in your post) the total profits arrived from the GCN against going multiplatform.

Where did you get your figures from btw? Those are a good start at attempting to discover just how much the GCN added to Nintendo's bottom line.

Let's put it this way, Nintendo doesn't want to make more money, that's why they are releasing the Revolution.

They don't want to make more money? I hope their shareholders know this!

Don't you understand, Nintendo is making a big mistake by NOT going third party even though the Gamecube made them money.

The question isn't, "Did the GCN make Nintendo a profit?". The question is, "Would Nintendo be better off profit-wise by selling their software multiplatform?"


After we consider the profit A vs. profit B argument, there are other less tangible benefits to having your own console. So if going 3rd party netted them more money, they might lose out on some other benefits.

Oh well, in the end I'm sure Nintendo has the real figures and have decided that as this juncture, the 3rd party route just isn't for them.

 

[Cornman]

I think they'll have a little trouble with the "We don't have any competition so anything we release will be a hit" strategy against the 360 and PS3.

nahh more like "we are going after untouched demographics, so in a indirect way we increase our marketshare and make make console and handheld exclusive genras while making a cheaper and easier developement enviroment to gain 3rd party support and not lock out smaller budget developers. all by turning video games back to video games NOT cinematic interactive computer entertainment" strategy.

 

[Readykilowatt]

They don't want to make more money? I hope their shareholders know this!

I was being sarcastic.

The question isn't, "Did the GCN make Nintendo a profit?". The question is, "Would Nintendo be better off profit-wise by selling their software multiplatform?"

No, they would be less profitabe. For example, I've recently heard that the GBMicro costs about $44 to manufacture. I wouldn't be surprised if the GCN costs a little above that dollar amount to manufacture.

After we consider the profit A vs. profit B argument, there are other less tangible benefits to having your own console. So if going 3rd party netted them more money, they might lose out on some other benefits.

Nintendo is a very profit-driven company. If they believed that the third party route was better and more profitable for them, the Revolution would have not been created.

Oh well, in the end I'm sure Nintendo has the real figures and have decided that as this juncture, the 3rd party route isn't in their best interest.

Fixed.

 

[Powderkeg]

There are 90 million PS2 owners and 20 million XBox owners. But some of those people will own both a PS2 and XBox so the number is likely closer to 100 million. Also some of those PS2/XBox owners will already own a GC. So there's likely around 90 million current console gamers who don't own a GC (110 million current gen console gamers in total). That's a lot of gamers, but is it enough to sell 120 million extra Nintendo games? (on top of another 60 million from the Nintendo fans)? Because that's what would be needed to even match the profit Nintendo made from GC.

Your math is really bad.

If there are 110 million Xbox/PS2 owners, and 90 million of them don't own a GCN, then that means that every single GCN owner also owns an Xbox or PS2. (It also means that more GCN's have been sold than Nintendo says they've sold.)

I would be surprised if 20% of GCN owners also owned another console.


And again who said anything about GCN profits? Unless the market trend reverses itself, which frankly I don't see happening, the Revolution will sell significantly less than the GCN. Now, if you've got some kind of really credible evidence that suggests Nintendo will reverse the market trend of them loosing marketshare, I would love to see it. If you don't, then you shouldn't use the GCN sales as the basis of your arguement.

 

[Powderkeg]

nahh more like "we are going after untouched demographics, so in a indirect way we increase our marketshare and make make console and handheld exclusive genras while making a cheaper and easier developement enviroment to gain 3rd party support and not lock out smaller budget developers. all by turning video games back to video games NOT cinematic interactive computer entertainment" strategy.

But that's not what they did. They simply capitalized on a lack of competition. There was already a very large video gaming market, made popular by the Atari 2600. What Nintendo did was capitalize on the fact that Atari was still selling the old 2600 ten years after it's introduction, and Nintendo had significantly newer tech.

And Nintendo lost many court cases due to their screwing over 3rd party developers. They most definitely were not friendly towards them.

 

[OVERLORD]

What if Marketing & Sales tried to earn their pay.

Nintendo may excel in innovation & have many talented people in game design but sadly the complete opposite applies to these departments.

The software/hardware promo's they keep churning out have run out of steam & has failed GC miserably due to lack of enough quality titles to keep things from stagnating!

Nintendo now make enough varied hardware both for home and portable @ descent prices to start bundling GC with GBA/SP, Micro or DS.

Leading up to XMAS, don't tell me another software/hardware tie up is forth coming! Now that Zelda TP's been delayed yet again. What other must have Nintendo games are on GC gamer's radar?

Unfortunately the answer is none.

If this lot were poker players they'd fail @ bluffing Ray Charles & Stevie Wonder!

There must be plenty of families like myself who would still benefit from Nintendo hardware bundles as I suggest.

There must be plenty of stock laying unsold. Stockpiled! Catching dust instead of the imagination of new gamers. You'd be able to afford 2 or more consoles for nearly the price of a PSP!

Now that I'm hopping on one limb! What if they were to buid new GC's with GBA player built in. No need to buy it as an option. This would also cover the lean GC software spell we keep experiencing with these cancellations & delays.

People moan GC is unable to play DVD's. One thing it can play with a little help is GBA games. Why stop there? I'd even further this idea later with built in DS gaming. Obviously later so as not to hurt sales there.

Some have likened Revoluion to Apples Ipod. What makes Ipod a success is not merely the fact that it plays MP3's (Many other companies do much the same, their batteries last longer and they support many more different formats) It's the many 3rd party add ons that extend IPOD's use.

GC could still be the gaming hub of Nintendo this generation if they put their mind to it. We could be looking @ 2007 before Revo release. GC could become the Swiss Army knife of Nintendo gaming. Not the spare wheel it appears to be now!

Just some of my radical ideas. They're better than Nintendo paralysis I see now!

I might even suggest with all these mobile phones out there that Nintendo attempt to capture some of the gaming market there! They have enough past IP for such a move. And it wouldn't hurt core business.

 

[Ty]

I was being sarcastic.

I was too, hence the smiley face.

No, they would be less profitabe. For example, I've recently heard that the GBMicro costs about $44 to manufacture. I wouldn't be surprised if the GCN costs a little above that dollar amount to manufacture.

It really doesn't matter what the GCN costs Nintendo to manufacture since we're really interested in the total profit the GCN has given Nintendo's bottom line - which takes into account the cost of making the GCN - in addition to R&D, marketing, etc.

Using Teasy's own #s, it would only take an attach rate of 1.8 titles over the lifespan of the console generation (5 years?) to be more profitable. (180 Million titles need to be sold total, 100 Million consoles)

Nintendo is a very profit-driven company. If they believed that the third party route was better and more profitable for them, the Revolution would have not been created.

I certainly don't have much evidence or thought to the contrary other than to say that it's quite possible they value other intangible benefits over short term profit gain. So even if becoming a 3rd party publisher would make them more profit in the short term, perhaps having their own console is part of their long term plan.

 

[London Geezer]

Uhm there was very little "strategy" in the NES days. The NES was the only thing out for a long time (and the Sega Master System didn't matter much in these days, though it was quite successful in Europe IIRC), they didn't need "strategy". Well apart from the illegal competition-stumping contracts with some 3rd parties in the SNES days. Oh and the price fixing in Europe. Funny how the majority of the people still looks at Nintendo with pink goggles and see them as a saintly companies that is only in this "for our own good", when they have been just as sly and manipulative as anyone else.

As a matter of fact, when Nintendo had to start using a bit of strategy (when competition toughened up and Sega and then later on Sony came out), they struggled. And they still are, although many will shield themselves behind the "Ninty are making a profit!". So i don't have much faith in Nintendo's "strategy".

When competition came out, they started losing market share, which is natural, but they shouldn't have lost SO MUCH market share. With no sign of regaining it either, or of any interest in doing so anyway.

 

[Teasy]

That's not the question I asked though. We need to compare (as you are attempting to do later in your post) the total profits arrived from the GCN against going multiplatform.

I missed out "that", the first line should have read:

To be honest when you look at the game sales on the system and consider the costs the question then becomes how could it not be that profitable?

Where did you get your figures from btw? Those are a good start at attempting to discover just how much the GCN added to Nintendo's bottom line

I got them from a top 250 current gen game sales chart sometime last year. I'm finding it very hard to find a good sales chart again though (had loads of links but lost them all when my PC crashed).

 

[Teasy]

Your math is really bad.

If there are 110 million Xbox/PS2 owners, and 90 million of them don't own a GCN, then that means that every single GCN owner also owns an Xbox or PS2. (It also means that more GCN's have been sold than Nintendo says they've sold.)

I think you'll find that my math is fine, you simply can't read properly

I didn't say that there are 110 million XBox/PS2 owners. I said there are 110 million total current gen console owners. 90 million PS2's, 20 million XBox's and 20 million GC's owned by around 110 million gamers.

And again who said anything about GCN profits? Unless the market trend reverses itself, which frankly I don't see happening, the Revolution will sell significantly less than the GCN. Now, if you've got some kind of really credible evidence that suggests Nintendo will reverse the market trend of them loosing marketshare, I would love to see it. If you don't, then you shouldn't use the GCN sales as the basis of your arguement.

I need evidence to disprove your guess work do I? Tell me, how can I give you evidence on something that hasn't happened yet? You want to talk about Nintendo and console profits, well all we have is GC for that, everything else is nothing but conjecture.

 

[London Geezer]

I think you'll find that my math is fine, you simply can't read properly

I didn't say that there are 110 million XBox/PS2 owners. I said there are 110 million total current gen console owners. 90 million PS2's, 20 million XBox's and 20 million GC's owned by around 110 million gamers.

Maybe it's just me but isn't that 130M...?

 

[Phil]

Teasy's assuming that some of them own more than one console, which is why he stated the 110 million number.

 

[Teasy]

Maybe it's just me but isn't that 130M...?

Nope, though its understandable you'd think that if you didn't read my original post. I was assuming that 20 million of the 90 million PS2 owners also owned a GC or XBox.

EDIT: Ah Phil beat me too it