Platform Holder Focus: Nintendo

Wii had a great year in 2008. What are your thoughts on the year ahead?
We are really happy with the numbers and way things have gone. The consistent growth we have seen has been great. And so far the indications are that we are set for a better year this year than even last year. We also have some fantastic product coming up as the year goes on – not just from us, but third parties too. They are releases specifically which are starting to, I supposed you could say, really make use of the Wii’s capabilities and redefine the potential that is there in terms of product development.

Games like MadWorld show a move beyond the ‘big head sports’ titles some have complained about in MCV. Will Wii show more of what it can do this year?
There’s been a lot of success for third-parties doing just that on the Wii already. I think it’s a mixed perception when people say ‘only Nintendo can succeed on Wii’ – there are a number of big sellers that prove this isn’t the case. Yes, Nintendo has had a lot of success on its formats and has titles in the charts, but when we add up the total sales of titles on our platforms the bulk of it is third party.

There is a lot of product out there for Wii – and it’s the quality which is winning through. That’s something important about Wii, and it’s an old sales motto: ‘Price will be forgotten and quality will be remembered’. I think that’s a testament to the success of third party games like Mario & Sonic.

So there is a huge opportunity out there – and there are games on the way. Games development takes time, and Wii developers have had to take some time to get to grips with making concepts for it.

And what of Wii Sports 2? The original is Wii’s benchmark game…
We are looking forward to it, but we’re not talking about the game itself yet.

GTA is a big franchise which hits DS this month – and proves how there is choice on those platforms. How will the launch of the game impact the DSi’s arrival?
The key thing for me is that GTA on DS proves there are lots of people making a variety of games for the device.

The interesting thing about GTA is back with the launch of GTAIV. When that came out last year, Wii Fit was out at the same time – and the two were almost complementary on the market. It showed everyone that there is a real breadth of entertainment in games.

DSi launches next month. Globally the DS instal base is close to 100m. There are over nine million sold in the UK. Can you push it further?
I think what people have to get in their mind now is that we as an industry are not usual – Nintendo has broken the mould and changed people’s expectations of what the market should be, or how things should sell in video games.

We are now appealing to a bigger audience and we – and I mean we as in the industry, not just Nintendo – aren’t narrowly defining ourselves any more. How will DSiWare work?
It’s a similar concept to WiiWare, except at this stage we are just offering bite size software for download which you pay for with Nintendo Points. That includes things like a little notebook application, or just a taste of upcoming products.

The iPhone’s pitch is based on similar things. How much of DSi is a response to that?
Well we have seen phenomenal growth on DS – it’s continually growing, and it keeps surprising us and surprising the market. What we as a company are focusing on to drive that is the quality of the games. We’ve developed new hardware to complement that – so any extra functionality we include isn’t so much driven by anything else.

What about marketing – how are you supporting the launch?
We’ll be making announcements on that further down the line. I can assure you though it will be a typical Nintendo launch – in as far as we have a ‘typical’ launch, we are often trying to do things that aren’t typical. It’s a very important product for us so you can imagine how hard we will push it.

And what about stock?
We’re comfortable with the amount of stock we’ll have available – but we are not going to stop stocking DS Lite. Stock availability will be consistent and steady, which is important.

Do you see DSi and Lite running alongside for a long time? Will you in time be targeting them at different demographics?
There’s a difference in price and functionality – but they are both DS devices and play DS games. So really the market will decide what they want. Our job as far as we are concerned is to make it clear to consumers that they have more choice now, and support them for however long they want each device. We are not planning to run out of the DS Lite; it will last as long as the demand is there.

Do you think consumers will switch from DS Lite ownership to DSi?
It’ll be a mixture. We expect some people will upgrade, but we also anticipate that we’ll win over people who were still undecided on DS – the extra features will help convince them. There’s an extra incentive.

Will there be games that work on the DSi but not on the Lite?
There will be games, given the functionality that the DSi has – such as games that use the camera or the sound functions – which only work on the newer DS. It’s the same as the few DS games that make use of the GBA port. But generally, most DS games will work on the DSi. The launch is more an evolution of the DS – but it is a step-change, more significant than the step from original DS to DS Lite.

Are you aware of high expectations for DSi amongst retail and publishers?
It’s good to hear our partners are just as excited as we are. Retail is tough for everyone at the moment, but having a new product is a good opportunity for all of us. It’s the only piece of new games hardware coming out this year, so is perfect for helping drive sales further.

What led you to a 149.99 price point, 50 higher than the Lite? Has Wii’s constant selling at 179.99 proven there is an upper pricing sweet spot you can target?
The two are different products – and I think people will pay different things for different technologies. We have priced at what we think is right, and also we have to cover costs. There is a pressure on all products manufactured overseas and then imported in terms of currency that we have to take into account.

Piracy and R4 cards have become a hot issue. Most don’t work with DSi. Can you explain your approach?
We’ve got a lot of security now in the DS to try and protect us from piracy – obviously with some enhancements we can’t give away our secrets. But the chance to upgrade the firmware has been a good opportunity to fight that.

A lot of our third party publisher partners spend a lot of money developing IP and invest a lot of jobs and studios into that, so piracy is something we need to fight.

Nintendo’s had a winning hat trick on DS over the past few months – Professor Layton, Mystery Case Files: Millionheir and 100 Classic Books. What’s next for the Touch Generations line?
Those three titles have been phenomenal – seeing them all sell so well was been very rewarding. I have to admit, while we were positive with most of them they still took us by surprise.

That shows that there are consumers out there who got into playing games through our formats through Brain Training, and contrary to initial scepticism from some that hasn’t been their only game.

They’re now buying Professor Layton and Millionheir – it proves that these new consumers will buy a good game when it comes out.

We’re constantly looking at ways to grow the software library of titles for everyone, and development in that sector is ongoing, although there’s nothing I can confirm at this point.

How much do you think the DSi will grow the DS market?
Each year we’ve had continual growth on DS, and last year we still increased share even though the Lite was out for two years at that point. Now, with a much more advanced device as well, who knows what kind of growth it could foster. We know from our figures that there are a lot of people out there who don’t own a DS and people who are interested. So we’re looking at things very positively in that regard.

There are 21m households in the UK – each one could conceivably have a DS. Or even more than one DS. That doesn’t mean that we’ll sell multiple units into every family and sell over 60m in the UK alone – we don’t think that will happen – but the numbers are still very buoyant. It is uncharted territory for the games industry as far as we are concerned.