This morning, Nintendo reminded us it's a Japanese company with announcement of a partnership with DeNA to bring its IP to mobile platforms and a brand-new console. Yeah, we're about as stunned as you are.
Late last night, Serkan Toto tweeted that Nintendo and DeNA had announced a joint press conference to take place an hour later, with forthcoming remarks by CEOs from both companies. At the event, the primary announcement was the alliance between both companies to bring Nintendo's extensive catalog of IP to mobile platforms. Nintendo is viewing the move to smartphones in the same manner it viewed the rise of televisions as a vector for the original Famicom and Nintendo Entertainment System.
"When we further analyze the situation, Nintendo's strength lies in, or our consumers see the most value in and are willing to pay money for, Nintendo IP, such as our software and characters," explained Nintendo president Satoru Iwata at the event. "This is why Nintendo has decided to utilize smart devices aggressively. Very simply put, it is structurally the same as when Nintendo, which was founded 125 years ago when there were no TVs, started to aggressively take advantage of TV as a communication channel. Now that smart devices have grown to become the window for so many people to personally connect with society, it would be a waste not to use these devices."
"This collaboration will create the best prospects for both DeNA and Nintendo," he added. "As for which Nintendo IP will be used, we do not intend to make any exceptions. Potentially, any Nintendo IP could be used in our smart device software."
Before you worry about seeing classic Nintendo games on smartphones, the announcement made clear that these will be all-new titles created specifically for mobile platforms. That means unique Nintendo experiences in a new form factor. Specific titles will be announced at a later date.
"Even if we use the same IP on our dedicated video game systems and smart devices, we will not port the titles for the former to the latter just as they are," said Iwata. "There are significant differences in the controls, strengths and weaknesses between the controllers for dedicated game systems and the touchscreens of smart devices. We have no intention at all to port existing game titles for dedicated game platforms to smart devices because if we cannot provide our consumers with the best possible play experiences, it would just ruin the value of Nintendo's IP."
In addition, Nintendo and DeNA will work together to develop a new membership service on multiple devices. That service will span the Wii U, 3DS, PC, and mobile platforms, with a planned launch in Fall 2015. It sounds like the service will operate more like Xbox Live or PlayStation Network, with a roaming account not tied to a single platform.
"Nintendo, together with DeNA, will jointly develop a new membership service which encompasses the existing Nintendo 3DS and Wii U systems, the new hardware system with a brand-new concept, NX, and smart devices and PCs, and Nintendo will be the primary party to operate this new membership service," said Iwata. "Unlike the Club Nintendo membership service that Nintendo has been operating, the new membership service will include multiple devices and create a connection between Nintendo and each individual consumer regardless of the device the consumer uses."
As a part of the partnership, both companies have purchased 22 billion yen ($181.5 million) worth of stock in one another. For Nintendo, this comes to a 10 percent share in DeNA. For DeNA, that's a 1.24 percent share in Nintendo.
Following the announcement of the partnership and expansion to mobile, Iwata then dropped the bomb about the brand-new console, currently code-named NX. There's absolutely no other details on that platform, with more information forthcoming in 2016. The early announcement is Nintendo's way of showing that it's still committed to dedicated game consoles for the foreseeable future.
"We aim to construct a bridge between smart devices and dedicated video game hardware that connects consumers to our dedicated video game systems," Iwata said. "For the consumers who are connected with Nintendo through smart devices and interested in Nintendo's IP, we would like to provide even more premium gameplay experiences on Nintendo's dedicated game platforms."
EDIT: Since there seems to be some confusion from readers, here's comments from an interview Iwata had with Time today.
"Development of smart device games will be mainly done by Nintendo, but it is significant that we are forming a joint development structure with DeNA," said Iwata. "Nintendo, through experience in the dedicated game system business, is good at making traditional game products. But for smart devices, in addition to the “product” aspect of a game, the aspect of an ever-evolving “service” is very important—a service that encourages consumers to play every day even for a short time. DeNA has extensive know-how in developing the “service” side of things, and will be primarily responsible for the service-oriented operations. We will be able to greatly leverage strengths of each party.
"As for any involvement of Mr. Miyamoto, we will discuss it when possible, but for now, understand that his priority is on the development of Wii U titles that will be launched this year."
He also discussed payment models, which is usually free-to-play in the mobile market. Iwata admitted that free-to-play was on the table, but Nintendo is open to other options.
"Nintendo does not intend to choose payment methods that may hurt Nintendo’s brand image or our IP, which parents feel comfortable letting their children play with," he said. "Also, it’s even more important for us to consider how we can get as many people around the world as possible to play Nintendo smart device apps, rather than to consider which payment system will earn the most money."
Well, that's surprising. I'm the one who wrote the words above, so my impressions will be on the lighter side. I saw Serkan Toto's tweet last night at around 2:40am my time, but I didn't expect much, maybe a Nintendo-themed mobile game like Puzzle & Dragons Super Mario Bros Edition. Despite the surprise, everything here makes a great deal of sense.
I'm not going to say Nintendo needed to jump to mobile, as the 3DS is still selling well, but this is an additional vector into the world of Nintendo for consumers who otherwise would've skipped right on by. Instead of Flappy Bird or Where's My Water, kids can rock official Nintendo games before upgrading to a dedicated console.
I'm glad that Nintendo's working with DeNA on a new account system. I always wondered why Nintendo didn't hire talented account system developers in Japan, as the original implementation of Nintendo IDs is less than adequate. According to DeNA CEO Isao Moriyasu, the companies have been in talks since summer of last year, which would explain the lack of speed in Nintendo's changes.
Nintendo's cautionary nature seems to have served them well. Some companies flailed around the mobile space before completely giving up or scaling back, but Nintendo is smart to leverage DeNA's expertise. The company has been successful in the mobile sector with its Mobage platform on Android and iOS, so they're perfect to help Nintendo fix its poor online account system and determine what style of games work best on smartphones and tablets.
And yeah, I'm pretty excited to have Nintendo making games on smartphones. I play games on my smartphones and tablets occasionally: the entire line of Kairosoft games, Infinity Blade, and some Telltale titles. If Nintendo's going to take the time and go all out, I think that's great. Let Miyamoto, Sakurai, Aonuma, and company play around on tablets, or use them as a chance to grow new talent within the company. This can only fail if the games are bad and we all know that's not how Nintendo rolls.
On the announcement of the NX, there's not much to say. We knew there was a console coming at some point, with the Wii U's sales being what they are. Nintendo has merely given a name to vague statements it previously made and shuffled the real reveal into 2016. Iwata calls the NX a "brand-new concept", and it's been surmised that the console will be some sort of handheld/home console hybrid, which would not count as a "traditional" home console. I'm not sure how Nintendo would pull that off, but I'm a writer, not an engineer. Either way, I'm sure they have a plan.
Hmm, I'm not sure I'd characterized myself as shocked, exactly. Nintendo's been leaning in this direction for a long time, dabbling in mobile and F2P concepts for quite a while. And they'd even told their shareholders that they were exploring mobile apps and platforms for a while. This sensation I feel isn't shock, it's... what's that feeling you have when something you've been dreading with sick certainty finally comes to pass? It's that one.
This really feels like a major and unavoidable tragedy coming to pass, like Krypton's sun exploding or something. Nintendo has long been the last "pure" video game company, and if they must eventually bow to the tyranny of mobile domination, what hope is there for the rest of the world? When I look back on video games from my comfy recliner at the retirement home circa 2055, I'll remember this as the moment they came crashing to an end.
OK, so I'm being not-entirely-serious here. But still, you can understand my trepidation: Mobile games aren't inherently terrible (some are phenomenally good!), but the format lends itself to unethical practices and the erosion of good game design. The last thing I want is for Nintendo to drift slowly into the worst tendencies of mobile game making, literally nickel-and-diming their business to death.
I think - more like strongly believe - the company's internal moral compass will make them resistant to that. Nintendo's executives seem keenly aware that the company's greatest form of currency is the reputation and quality of its properties; Mario and Link and Samus have premium status among game franchises, because Nintendo vets their appearances scrupulously. They only appear in good games (yes, yes, get your snarky Other M comments out of the way now), only appear on good products, and generally avoid the pitfalls common to other franchise properties. If Nintendo cashes in on its good name in the short term, what does it have for the long term?
On the other hand, man, have you ever read the minutes of a Nintendo investors meeting? Its stakeholders don't get games, and they don't have much patience for losing money. The big fear here, I think, is not that Nintendo will start churning out exploitative Candy Crush-caliber garbage game design because they can, but rather that investor pressure will make that tragic outcome unavoidable. The one silver thread of hope trailing into the future is that Nintendo is a Japanese corporation, not American, so its executives and investors are more likely to be capable of comprehending the welfare of the business beyond next quarter's returns.
If there's a surprise here, it's that Nintendo has jumped into an existing platform with DeNa rather than making their own. The Nintendo way from the very beginning has been to build everything from the ground up, to own the platform and the process the entire way. Nintendo got into games from the toymaker's angle, spinning consoles and handhelds out of standalone Nintendo-manufactured dedicated devices in the '70s and '80s, and the need to control the business at every level remains deeply embedded in Nintendo's DNA (not their DeNa). In fact, conversations about Nintendo's inevitable move into mobile have been evenly split between "when is Nintendo going to make iPhone games" and "when is Nintendo going to make its own phone" - telling, I think.
But if their DeNa connection means what it seems to mean - that they're going to begin making games for other companies' mobile devices - it's a smart move on Nintendo's part. Hardware has increasingly become the least profitable part of their business in recent years, and the mobile market is cutthroat. Even Apple didn't just jump right in with iPhone; they did that stupid ROKR phone with Motorola first. Entering the mobile market as a platform stakeholder would be a really good way for Nintendo to burn through its cash on hand and end up being bought by a pachinko company.
Maybe this project "NX" will turn out to be some sort of hybrid device that give Nintendo its "proper" entree into the mobile market. Like Mike said, everyone has been speculating that Nintendo's next system will hybridize portable and console gaming, so it's not that much of a stretch to imagine they'd throw mobile into the mix. But, honestly, I kind of hope not. Taking on the mobile market is a massive and demanding task that could easily bankrupt the company, and given Nintendo's historic conservatism I feel like it poses too much of a risk for their blood. Then again, maybe Iwata sees this as his own "rise to Heaven, sink to Hell" moment. Still, there's a lot more to gain by Nintendo easing into the market. Imagine the furor if they had some sort of platform exclusivity with an existing mobile manufacturer - the bidding rights over getting Mario and Pokémon on iPhone or Android would make the bidding wars over streaming rights to Seinfeld look like peanuts.
As long as Nintendo still makes great games first and foremost, though, that's all I care about. Given how cautiously they've tread in the F2P space, I'm not too worried. Yet. As long as I can continue to unlock the Tubular and Funky levels from Mario's Star Road with playing skill rather than via a microtransaction pop-up, all's well.