Thursday, January 31, 2013

Nintendo Releases Their Third Quarter Financial Results

           Nintendo released their third quarter financial results briefing today.  While the Japanese market for Nintendo is still booming, President Satoru Iwata admitted the failure of Nintendo to penetrate the western market, and discussed strategies going forward for increased sales, including bringing more Japanese-developed games to a Western audience.
           The revision of their financial forecast by Nintendo can be, “…largely attributed to the slow growth in U.S. sales.” Nintendo has only five titles in the top 20 best-selling games of 2012 in the U.S; Just Dance 4 (the highest on the list at number 6), New Super Mario Bros. 2 (10th), Just Dance 3 (12th), Mario Kart 7, (14th) and Pokemon Black Version 2 (17th).
           Nintendo controlled only 19% of the hardware market share in the U.S in 2012, and only 21% in Europe.  The 3DS, “…sold fewer units in the U.S. than in Japan despite the fact that the U.S. market is significantly larger than its Japanese counterpart.”  The 3DS, “…lacks diversity, and as a result…does not have as wide and diverse an appeal as Nintendo DS.”
       Nintendo attributes the slow start of the WiiU in part because of a shortage of new software released early this year, due to some development delays of the console.  Nintendo also attributed the software shortage to the cost of game development for home consoles, making it, “…very difficult for third-party developers to take a risk by developing games only for one home video game console.”
           In order to bring more third party content to their consoles, Nintendo is trying to, "...expand the range of software developers", by adding the ability to, "...develop the Wii U software using web technologies like HTML5 and JavaScript and Unity...."  Nintendo is planning to have more news on software development at GDC in March.
           An interesting idea that Nintendo is trying to implement is the ability to, “…integrate the architecture to form a common basis for software development so that we can make software assets more transferrable…regardless of form factor or performance of each platform.”  Nintendo is hoping this will help reduce the development delays which usually happen just after the launch of a new console.  Though they also say the new common basis for software development “…will have no short-term result…”
           It’s good to see Nintendo is doing so well in Japan, and I am glad Nintendo might finally be realizing slow sales in the West is partly due to releasing a lot more titles in Japan than in the West.

Read the full presentation by President Iwata

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