"Just Think of Paying 99 Cents to Get Mario to Jump a Little Higher"

Investor pressure is back on Nintendo to jump into the lucrative mobile gaming marketplace.

News by Pete Davison, .

According to The Wall Street Journal, one of Nintendo's investors has once again put pressure on the gaming giant to move into mobile gaming.

Seth Fischer, manager of a hedge fund that owns shares in Nintendo, believes that the company should create "very profitable games based on in-game revenue models" and attempt to leverage smartphone games, who he suggests is "valued by the market at well over $100 billion."

The standout quote from the complete letter is a sentence that will likely strike fear into the hearts of longstanding Nintendo fans: "just think of paying 99 cents just to get Mario to jump a little higher."

While the immediate reaction to Fischer's suggestion here is largely unprintable, it's worth considering why he made it in the first place. Like it or not, free-to-play mobile gaming stuffed with in-app purchases is an enormously lucrative part of the games industry -- to such a degree that renowned developers like Trials creator RedLynx would rather publish a mobile game as a free title with IAPs than a pay once, play forever deal. This isn't a particularly good situation, of course -- it gives us travesties like EA's desecration of Dungeon Keeper, for example -- but it's the reality of the industry as it stands today. And, as an investor, Fischer is more likely to be looking at what will make some money rather than necessarily what will actually provide a good experience for players.

Would you pay 99 cents to give Mario a Luigi jump?

But there are a couple of strong arguments against Fischer's suggestion, too. One of the more interesting statistics arose recently following a survey from analytics firm Swrve: according to them, only 0.15% of mobile gamers make up 50% of in-app revenue, suggesting a strong reliance on "whales" -- those who spend a lot of money on free-to-play games. In total, only 1.5% of active players purchase anything, with the majority of items coming in the $1-5 range -- though $50+ items made up 0.7% of purchases but 9% of total revenue. This means that although there might be a hefty number of active players of free-to-play games -- popular social and mobile games have millions of daily active users -- very few of them are actually paying up, and those who are paying up are paying significantly over the odds. This would largely seem to go against the model Nintendo has been using to date: packaged, pay-once games that very occasionally have premium-priced expansions. In other words, Nintendo's player base may be smaller than that of a popular mobile game -- but all of them are paying.

The second argument is that Nintendo games have long been renowned as being perfectly tuned, immaculately designed experiences in which success is dependent on player skill rather than brute-forcing your way through. Take a look at this video, for example, in which a player completes the original NES version of Super Mario Bros. with the lowest possible score (500) thanks to the game's pixel-perfect accuracy when it comes to jumping. Throw in the option for players to pay a dollar to break that carefully tuned game balance and you destroy one of the most beautiful things about that game -- and knowing Nintendo's fastidiousness about this sort of thing, it seems unlikely that they'd ever want to do that. And this isn't even getting into the inherent inaccuracy of touchscreen controls, which are, to put it mildly, less than ideal for games that require precision -- like platform games.

Nintendo has proven that it isn't against the idea of free-to-play games thanks to upcoming titles like Steel Diver: Sub Wars and Rusty's Real Deal Baseball (formerly Darumeshi Sports Store) -- but it's also proven that it intends to do so on its own terms. Steel Diver's implementation of free-to-play is more of a demo/full version scenario, while Rusty's allows players to haggle over the cost of in-game purchases. Neither, crucially, offer consumable in-app purchases like most mobile free-to-play titles do -- in both cases, you pay once for something, and it's yours. No energy bars, no wait timers, no boosters -- just things you bolt on to the existing experience and then keep.

So long as the mobile marketplace is perceived as profitable, the fact that IAP-infested free-to-play games are, for the most part, simply not very fun will continue to pass investors by -- and they will continue to apply pressure to Nintendo to branch out into this aspect of the industry, particularly as Wii U continues to struggle. At this rate, though, it's looking unlikely that Nintendo will cave to such pressure -- it's always been a company that's done things its own way, and that seems unlikely to change even during these challenging times.

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Comments 15

  • Avatar for Stealth20k #1 Stealth20k 4 years ago
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  • Avatar for Funny_Colour_Blue #2 Funny_Colour_Blue 4 years ago
  • Avatar for christopherhughes97 #3 christopherhughes97 4 years ago
    Wow. I'm glad that everybody decided that games should be separated into "casual" and "hardcore". That's certainly turned out well.
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  • Avatar for ProfAmaretto #4 ProfAmaretto 4 years ago
    I really hope the line "Just think of paying 99 cents to get Mario to jump a little higher" made Nintendo execs laugh out loud.

    "Please understand... this is a terrible idea."
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  • Avatar for docexe #5 docexe 4 years ago
    Nintendo made touchscreen controls mainstream with the DS before Apple and the iphone started the current mobile revolution, so technically speaking, it would be viable for them to put some games (like Brain Age and Kirby’s Canvas Curse) on phones.

    But the simple truth of the matter is that the business model that has become predominant on mobile (F2P with IAP) requires design principles that are just complete opposite (and sometimes, completely incompatible) to Nintendo’s design philosophy. That’s one of the primary reasons why demands from investors and analysts for them to go mobile are shortsighted. In its current market conditions, mobile is not a magic bullet that will solve any of the company’s problems.

    On the other hand, publishing F2P games on their own platforms, under their own terms, and with approaches similar to Steel Diver and Rusty’s, seems like a more reasonable course of action for Nintendo.
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  • Avatar for DiscordInc #6 DiscordInc 4 years ago
    And this is why board members don't actually control the company. I can't think of a single thing that could destroy Nintendo's reputation more thoroughly than an F2P version of Super Mario Bros. No amount of money they could possible make would be worth that.
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  • Avatar for Monkeyfistgaming #7 Monkeyfistgaming 4 years ago
    99 cents wat do they mean
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  • Avatar for SargeSmash #8 SargeSmash 4 years ago
    I wish I could come up with something more pithy right now, but my general statement on the matter is NO.
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  • Avatar for Ohoni #9 Ohoni 4 years ago
    Wouldn't the "no brainer" mobile game for Nintendo be their Pokemon card franchise? Just have a digital version where you buy packs? As for the more classic titles, what if they released a free version of the original Super Mario Brothers, but offered in-ap purchases where you could swap the player sprites for Toad, or Peach, or Daisy, etc. through as much of the cast as demand allowed for. That would seem like an easy thing for them to do, and not crazy exploitative, and I bet a ton of people would pay to play as Peach rescuing Mario.
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  • Avatar for docexe #10 docexe 4 years ago
    @Ohoni Those are… actually sensible ideas. But I think they should implement something like that on their own platforms first before turning to mobile.
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  • Avatar for SatelliteOfLove #11 SatelliteOfLove 4 years ago
    "Do you want their money or their respect?!?"
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  • Avatar for Natabuu #12 Natabuu 4 years ago
    Is it too late to join Occupy Wall Street?
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  • Avatar for Shadowfire #13 Shadowfire 4 years ago
    So wait, a free Mario game that only costs $.99 to unlock Luigi? That doesn't sound so bad.
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  • Avatar for DiscordInc #14 DiscordInc 4 years ago
    @Ohoni I can see the first idea happening, but probably not the second.

    Actually a really good idea would be to expand Brain Age and Wii fit to mobile. Not only could they create experiences that wouldn't be limited by the phone, but it would be easy to connect them back to their own hardware.
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