Don't get too excited. It's probably just the localization of PokéPark 2.
Sony said that the PS3 should last a decade so it should be halfway through its life span right now. As for Microsoft, I don't recall them saying anything similar so it may very well be possible that they announce a new system.
I'm not getting excited, it's just ninty would never go this long without releasing a game for their top selling series... Just sayin
the 10 year plan which means they will continue to support the system with updates and revisions and release games for it for at least 10 years, that doesnt however they wont reveal and release a PS4 long before then
If they only show better graphics, not so much, we can already see that on PC today.
they have been doing it for a while now with the PS2 and PS3
The like was for the info.
About software release scheduling and the droughts:
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As for your second question, just as you pointed out, offering software one after another is a never-ending challenge we have to try to overcome. We failed to offer strong software titles without long intervals in the first half of this year, but it was not because we did not place importance on offering them one after another. Even when we understand the significance of this, we are sometimes unable to do so. We should have prepared a more thorough backup plan. We were planning to launch software in the first half of this year without too many intervals. However, we ended up delaying the launches of multiple software titles, and we could not make up for it. Around the same time, the third-party titles did not become huge hits, either.
For us to provide software titles one after another, one idea is, “Isn’t it possible for Nintendo to stock some of its software titles instead of launching them as soon as the development is completed?” Video games need to stay fresh, so it is not practical for us to put them on hold for too long, but we think that some of them may be held for a certain amount of time so that there will be a short interval between when they are completed and when they are launched. We are taking on this sort of challenge for the Nintendo 3DS. For example, when we look at the software lineup for the year-end sales season, it is so dense that, if we added any more software, the total sales would not increase. Accordingly, we have intentionally delayed the launch of some software titles to early next year.
Another idea is for us to further intensify our collaborations with the software developers and the third-party publishers. When we launched the Nintendo DS and the Wii, Nintendo made some very unique proposals which were not in alliance with the mainstream concepts held in the video game industry at that time. As a result, there was no choice but for us to invigorate these platforms through Nintendo’s own efforts so that they could be up and running. And, the initial purchasers of the products were mainly Nintendo fans. Particularly in Japan, for the Wii, we struggled to create the circumstance early on where third-party Wii titles sold in huge volumes. Because we could not show a good sales record for third-party Wii titles, third-party developers did not sustain their passion to create software for the Wii. In the overseas markets, there have been a number of third-party hit titles on the Wii. However, there was also a challenge that the Wii was not fully capable of catering to the needs of, for example, first person shooter games, the users of which prefer platforms compatible with HD TVs. For these challenges, we will be able to improve the situation with the Wii U and the Nintendo 3DS. In fact, a number of software publishers and developers have recognized this fact and have started working on their software in a variety of ways. Overall, I think that we will be able to establish an environment where we will not repeat the same mistake that strong titles were not released until about six months after the launch of the hardware.
About the generational transitions, and collaborations:
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Let me first explain the reason for the software shortage. As you just pointed out, the period when we needed to shift from the Nintendo DS to the Nintendo 3DS overlapped with the period when we had to prepare for the Wii U. If there had been no overlap, or if there had been a three or four year interval, Nintendo could have focused upon just one new hardware system while also taking care of two existing platforms. However, as we have had to take care of two existing platforms and two new ones, it has been more of a challenge. We need to face these hardware transitions from time to time, but the intervals between these transitions are not fixed. The Nintendo DS, for example, has been able to maintain a large presence in the market for a relatively long period of time, which has resulted in a huge installed base of the hardware and an unprecedented number of software sales in the history of portable video games. So, it is not a good idea that we stick with past product cycles. But we think it is true that the longevity of the Nintendo DS has created this challenging aspect for us today.
In such a circumstance, we are more conscious that we must once again re-think how we can create a good balance between what we do internally at Nintendo and what can be done externally. Looking back, certain experiences enabled by the Nintendo DS and the Wii were created just because Nintendo took on these challenges internally, and these experiences were able to drive the overall sales of these platforms. Nintendo was fortunate to have that kind of successful experience. Although I try not to use the term “success” at all, and particularly for this kind of opportunity, but this time I’d like to use this expression. With the experience of success, we tended to have the mindset that it would be the safest and most secure if we took care of everything by ourselves. As I said, however, the time always comes when we must prepare for the next platform. When that time comes, rather than trying to do everything by ourselves, we must try to narrow down what we really have to do inside the company and think of how we can best collaborate with people from other companies. For example, the teams led by Shigeru Miyamoto of Nintendo’s Entertainment Analysis & Development Division have already been cooperating with external developers in order to create titles which would have been developed internally at Nintendo in the past. Now that we realize there may be times when we need to take care of four platforms at once, we are initiating these new challenges, and I believe that such a fixed notion as, “we have to do everything by ourselves,” has faded inside the company to a large degree. So, I am expecting the situation to further improve from now. On a similar note, we often receive criticism that Nintendo is not good at deploying its services on the Internet. We are also internally discussing whether it is the best use of our development resources if those developers who are capable of making hit video game titles have to devote themselves to Nintendo’s Net-related services. Our basic idea today is that our internal game developers should focus on making new, unique and fun software while we collaborate with outside resources, especially in the fields for which Nintendo is not specialized in.
About the 3DS overseas this holiday, and Mario is kiddy in Japan?
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As for your next question, I can understand the sentiment that, while the Japanese market can look forward to “Monster Hunter 3(Tri)G," the overseas markets do not have such a title and the two Mario software titles alone may not be able to appeal to a sufficiently wide consumer base. On the other hand, I feel that this sort of question is often asked only in Japan.
To give you some background information, I understand that Mario had a rather childish image in Japan. I recall that it was my second year as the president of Nintendo, when we did research on Japanese consumers which showed us the result that they have this childish image of Mario. Of course, we really appreciate the fact that our characters are loved by children. On the other hand, it does not make us happy if adult consumers say that Mario is childish. They felt that our products were too childish to be relevant, which was the issue we needed to work on. I believe that the situation surrounding this image has largely changed. Initially, our research in Japan suggested that 3D Mario was childish but that the original 2D Mario, who was drawn in the NES era as a group of pixels, was cool. The company tackled this issue in various ways at such occasions as the 20th anniversary campaigns for the Japanese launch of NES and by the reintroduction of the original “Super Mario Bros." game for Game Boy Advance. Such efforts led to the smash hit of “New Super Mario Bros." for the Nintendo DS. This title became the first huge-hit Mario game in a while in Japan since the original “Super Mario Bros." game. From this sales result, we can say that Mario has become a franchise which can be accepted by both adults and children.
These graphs are from the slides used at the Financial Results Briefing on May 8, 2009.
However, there still is an age group which shows less support for our offers in Japan, and they are male junior-high, high-school and college students. So, when you look at the age-demographic charts of our consumers in Japan, it looks like the back of a two-humped camel. Namely, there is a significant number of users in the children’s age demographic but a dint in the high-school and college student age groups and then the number of our consumers increases once again in the adult demographic. “Monster Hunter 3(Tri)G" must appeal with great affinity to that group of consumers, and I believe you can appreciate that. Now to your question of, “Will Nintendo be ok without a title that is the equivalent of Monster Hunter in the overseas markets?", I should first confirm that there is not such a dent in the U.S. and Europe.
In other words, the phenomena that consumers show less interest in Mario during their junior-high, high-school and college years can be observed only in Japan. Of course, adding software which is inherently different from Mario games must add to the solid software lineup for the Nintendo 3DS in the upcoming year-end sales season, but since Mario action games and the Mario Kart series have been welcomed by most age demographics there without the similar dents as in Japan, I do not think that the overseas sales will not go well because of the absence of a software title like the Monster Hunter software. In Japan, regarding the age demographic (to which Nintendo has attracted less attention than other demographics), Nintendo software and Capcom’s “Monster Hunter 3(Tri)G" will supplement each other in order to generate strong appeal overall, while in overseas markets it’s our expectation that the two titles of “Super Mario 3D Land" and “Mario Kart 7" will be widely accepted in terms of age demographics. Needless to say, we are making efforts to prepare a wider software lineup, including software with a charm not typically provided by Nintendo, in order to satisfy the needs of many different consumers. Please understand, however, that if anyone has the notion that the absence of Monster Hunter will create a less enthusiastic market condition in the overseas markets than in Japan, it is different from my belief.
About smartphone and social gaming:
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One impression we have as a result of reading articles on Nintendo recently is that these articles are confusing the effect of social games and the effect of smartphones and discussing them together although they are two different subjects which must be discussed separately. For example, the majority of social games, which have expanded in Japan, are not available on smartphones today. The fact is, the majority of such games are played on multi-functional cell phones that we Japanese often and uniquely call “Galapagos Cell Phones" or, more recently, “Feature Phones." It appears these two different devices are mixed together in their arguments.
Regarding the effect of so-called “social games," it seems that so many people believe in the causal relationship between the decline in Nintendo’s business performance and the rapid expansion of social games just because these two events have happened simultaneously. On the contrary, we do not believe that they are a big factor in our slower performance today. Since I have repeatedly explained about this in this type of opportunity (*), I do not intend to repeat the same explanations but, as we continue our research even after making such an explanation, we have never found any research data which show any meaningful differences in the attitude towards or in the frequency of playing with the Nintendo’s handheld game systems as a result of playing with social games. Accordingly, we have to think that there are no causal relationships. Game businesses are largely affected by the availability of a hit title. At the upcoming year-end sales season, where we have multiple software titles which have the potential to become hits one after another, we believe that we can pull the trend to our side. We really want to show a year-end sales result that can more effectively communicate to a number of people that the growth of social games has no causal relation with Nintendo’s performance.
Next, about smartphones. Smartphones in Japan have entered into a cycle of rapid expansion this year. In the U.S. such a trend was found earlier. Among younger generations in particular, smartphones have become the contemporary must-have items, and it has become rather common for us to switch to smartphones at the time we need to exchange our existing cell phone for another. With smartphones, you can play games without purchasing a dedicated game system, and these games are offered either free of charge or at extremely low prices. In this regard, there is no doubt that the bar has been raised higher than before for us to encourage consumers to spend several thousands of yen for a video game in Japan.
However, approximately a decade ago, a number of people used to say exactly the same thing. Namely, they said that, with the ability of cell phones back then being able to run a variety of software applications, dedicated handheld game systems would not be purchased any more. The fact is, their forecast has not become a reality. This time, the basic structure is the same. Nintendo has been recognizing that video game systems are something that consumers are obliged to buy in order to play with the software they want to enjoy. Therefore, the most critical thing for us is to periodically propose software that can encourage people to have the mindset of, “I really want to play it." The circumstance surrounding us has not changed in this regard. On the contrary, we now have a means to communicate our information rather effectively to our consumers directly. So, as I said today, we are currently considering how we can best take advantage of this media, and our attempt to put Nintendo eShop on the Web is one of such efforts.
As for the opinion that game dedicated handheld devices are not needed any more as long as you have a smartphone, I cannot say that no one holds such a belief; however, the results of our research have not shown any meaningful differences between the game play attitudes of consumers that do own smartphones from those who do not. Accordingly, as long as the Nintendo 3DS can offer gaming experiences that can not be realized on smartphones, and if they are attractive enough, we can ask our consumers to purchase the Nintendo 3DS. The important thing for us is to make these proposals by taking advantage of our position of being able to make unique offers based upon the integration of both hardware and software as we are making both.
So far, as I have made these explanations based upon Nintendo’s own research, I was concerned that you might not feel that they have strong credibility. Accordingly, I would like to introduce you to some different data (which was reported to us from Nintendo of America) today. In the United States, there is an organization called the Entertainment Software Association or ESA for short, which is similar to what CESA (Computer Entertainment Supplier's Association) is in Japan. They are the industry body for a group of entertainment software developers. Every year, ESA conducts a survey regarding interactive entertainment hardware and software. What you can see now is some of their research results of this past April, showing whether or not people are playing more video games in comparison to three years ago.
[Ed: I cut out Iwata's description of the survey results]
The survey result does not support the generally-conceived notions that, now that the digital age has come, people are buying less packaged software for dedicated video game systems and that they will be willing to buy less of them from now on. Overall, there is no doubt that the importance of digital business is increasing in the industry. However, the situation is not as simple as that the packaged software sales will decrease and digital distribution will increase or that the lifespans of dedicated game systems are coming to an end and general-purpose devices are the future. Our consumers are not showing such a trend. What the industry will look like 20 years from today may be a different story. But as far as the ongoing trend is concerned, I do not think that our understanding of the overall game industry and consumer attitudes is greatly different from the reality. I thought that the survey results I have just shown you could prove our point, so I used this opportunity to share them with you.
