A Heart-Lifting Article

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http://www.warcry.com/scripts/columns/view_sectionalt.phtml?site=15&id=404&colid=8114

On October 03, 2005, Nintendo, Sony, and Microsoft are gearing up for the next round of the ongoing console wars. Conventional wisdom says Nintendo is doomed. Twin dreadnoughts known as the PlayStation 3 and Xbox 360 are sailing over the horizon. All we know about the Revolution is it has a nifty controller. Nintendo even admits outright that the Revolution won’t be as powerful as the other two console entries. Furthermore, Nintendo is putting on a PR blitz suggesting it’s going to do other than make “more shiny.”

To the gaming industry, this isn’t just blasphemy, it’s outright suicide. Conventional wisdom states you have to use the beefiest processor possible and come out with videos showing shiny things. If you don’t, you’re just not cool enough to run with the big boys.

However...

Not all is well in Big Boy Land. Microsoft’s Xbox division has lost over $4 billion. Things don’t look better for the 360. The current best guess is $75 lost per console sold. Sony’s behind, but not by much, and plans to lose $1 billion in the first year of the PlayStation 3. That figure doesn’t include the billion-plus dollars it spent developing the Cell processor.

Furthermore, anyone who spends one second with Yahoo and the keywords Sony PlayStation losses finds a history of Sony throwing millions down the console black hole. Since 2001, Sony has been pursuing market share and bragging rights with nothing to show for it but negatives on the balance sheet. Sony is also fighting on another front, battling Nintendo for the portable market and losing millions there, as well.

Nintendo’s profits aren’t doing great, but they are the one company that can talk of “profits” in this sector. So, we come to my theory.

Nintendo is watching, leaning against the ropes, letting the big two punch each other and throw punches at it, and just waiting for them to tire each other out.

I’m starting to think it’s a sound strategy. After reading the interviews I linked above, I’m willing to revise my estimate of Nintendo, and change them from “mad geniuses” to “mad geniuses who know what they’re doing” on my personal opinion sheet. Nintendo is making a dangerous gamble on a new strategy. All the talk coming out of Nintendo HQ centers around bringing new people into the industry with a fun, inexpensive console that’s really cool to play. Nintendo doesn’t seem concerned with showing off the shiny and getting hardcore gamers. On the surface, this is suicide, but I’m going to cut them some slack.

Nintendo has the luxury of the long view. They’ve been around since 1889 and I guess relative upstarts like Sony and especially MS look pretty silly compared to a hundred-plus years of gaming industry experience. Just to give you some idea of the challengers they’ve faced and beaten, here’s a list of companies that lined up to go toe to toe with the Big N in the years after the original NES: Sega, Atari, Commodore, Amstrad, NeoGeo, NEC (TurboGrafx 16), Watara, Philips, Apple (Pippin via Bandai), and Bandai (Playdia, Wonderswan, Pippin). I guarantee no matter where your allegiance lies, you recognize two or three of those names.

Sony and Microsoft don’t have the luxury of bleeding billions forever. I may be a hippy writer, but even I know losing billions of dollars a year based on marketing and placement isn’t going to work forever. Sony and MS are businesses first. One day, someone in a suit more expensive than my house is going to see the billions (read that: billions) thrown into these two black holes and say, “Remind me why we’ve wasted billions of dollars we could be using for our core competencies on game consoles that don’t make us any money and, in fact, require losing lots of money just to stay competitive.”

In the meantime, Nintendo waits and quietly makes money from gaming consoles and games. The Revolution strategy seems pretty sound to me. Step outside the “gamer” mindset for a second and follow me, here. Normal people, non-gamers, don’t care if they get twenty megapixels to the gigaflop. Most people don’t care about raw power or impressing their friends with watching Covenant reflections in the Master Chief’s armor. Do you know why Dell and Gateway lead the PC industry, and Alienware is a specialty maker? People want something easy to use that doesn’t cause them too much trouble. Why do you think Toyota and Nissan continually top car sales charts? Because you hop in and drive, change the oil every 3,000 miles, and don’t think about how they work. Power is a concept your average consumer only vaguely comprehends. They know 1.5GHz is more than 1.2GHz, but they couldn’t tell you what a gigahertz actually is and why they matter.

Nintendo isn’t even thinking about gamers. Nintendo is thinking of that vast, untapped market segment known as non-gamers and wondering how they can catch them. What those people like, and what they will buy, is something uncomplicated that just works for what they want to do.

How is Nintendo going to fight its way off the ropes? To use some old boxing clichés, they’re going to stick to the fundamentals and throw combinations.

Start the big punch combo with the controller. Hand your grandmother a S-Controller or DualShock. You’ll probably fuse her brain. The Revolution’s controller looks like a remote control. Everyone knows what to do with a remote control. You point it at the TV, push a button, and something happens. It’s approachable. It’s intuitive. It’s not 27 buttons, triggers, sub-buttons, directional pads, thumbsticks, and devices that would require three people to operate correctly. I’ve owned an Xbox forever and I still don’t see the point of those annoying little black and white buttons.

Second punch, and those “fundamentals” I was talking about: the games. Nintendo makes games that aren’t just good, they’re touchstones for generations. Mario? Zelda? Samus? MS and Sony wish they had that kind of star power in their stables. Name me a bad Zelda game. Wind Waker doesn’t count, if you’re just going to complain about the art style.

Nobody makes games like Nintendo makes games, whatever their hardware foibles. Fine, but Nintendo is notorious about launching with three games and not having anything good for a year. How long did Nintendogs take to come out? Exactly. But it came out. In this case, they’re probably not going to be able to launch with no games. Details are still hazy, but the Revolution is supposed to have a back catalogue for purchase and download. I’ll gladly pay $20 to not have to torment my poor old 1986 NES when I want a round of SMB3 (I know it’s on the DS/GBA, but it’s not the same).

Thrid punch: price point. While Sony is ranting about how everyone will buy a PlayStation 3 if they overprice it, and MS is planning another high-priced entry, Nintendo’s Revolution is going to be pretty darn cheap. They’ve even said they’re happy being a second or third console. The best and most cunning part of their strategy is this: Nintendo doesn’t have to win. They just have to do well, because they’re ahead on points/profits. The other guys are racing like maniacs around the track and Nintendo serenely cruises on with the season wrapped up.

Am I saying Nintendo’s going to clench the win in this round? Not at all. The gaming industry has a way of smacking down innovation for being different, and the Revolution might just be too weird for middle America. What I am saying is that I hope they pull it off, that their roll of the dice comes up a winner. Either way, I salute Nintendo for daring to dream big, when the other console makers are looking for better ways to make things shiny.