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Why Nintendo is committed to the Wii U

There is an Asian proverb; ‘He who rides the tiger is afraid to dismount’.

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Nintendo's Satoru Iwata

This proverb can help explain some of the thinking which goes behind the Japanese approach of still supporting elements which are supposedly “failing”. In the video games industry this line of thinking applies very well with Sony’s continued support of the Vita, and more importantly (in the case of this article) Nintendo’s refusal to kill off support for the Wii U.

There is another variation of this proverb which goes; ‘He who rides the tiger can never dismount’. There are subtle differences between the two proverbs, with the former suggesting that it is more dangerous to stop than it is to continue, and the latter suggesting that once you start something you have to carry on to the end.

Nintendo as a company are committed to supporting as best as they can all of their products, but that does not mean that they do not know when it is appropriate to cease support. This is evident with the Virtual Boy which was widely deemed a massive failure. Nintendo ceased support for this venture just one year after being released. Likewise with the Pokémon Mini, a tiny Game Boy like system with interchangeable cartridges that just played specially designed Pokémon games, support in the West was short-lived and this did not extend much further in Japan.

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Nintendo do know how to cease support before it is too late. Conversely they also know when it is more costly to not continue to support something. This has been most evident with the 3DS. As during the first year of its life the 3DS experienced a fairly disastrous launch window. So much so that after only a few months Nintendo made the dramatic decision to announce a fairly substantial price cut for the system. But unlike most companies that do so not long after a systems release, Nintendo were keen not to attract the wrath of the early adopters. To do so they announced the Ambassador Programme which provided those who had registered their 3DS with Club Nintendo before a certain date to ten NES games and 10 GBA games for free (currently the GBA games on the 3DS are still exclusive to Ambassadors).

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This move helped initially to alleviate some of the problems, but an attractive software line-up is needed for the long term security of the system. Satoru Iwata in a recent Q&A has stated the importance of software and added that one game can turn things around. The first Christmas after launch the 3DS got not one, but two such games; Super Mario 3D Land and Mario Kart 7. This was the big push that the system needed as it helped increase sales and build a larger user base making the system more attractive for 3rd parties to develop titles for it. Furthermore smaller titles like Steamworld Dig found success in the eShop proving that it is possible for non-Nintendo titles to do well on the digital store prompting other smaller developers to do the same. Since this point there has been no stopping the system, which prior had been almost universally written off and deemed a failure, with some even questioning Nintendo’s existence as a handheld manufacturer.

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Unfortunately since the launch of the Wii U there have been many parallels with the early period of the 3DS’ life, although the situation now has been going on longer and has been worse, especially when compared with its direct competition. Again there are many who have already called the system a failure with some also calling for Nintendo to abandon the system, but to do so would be abandoning those who have already invested in the system. Six million is still a substantial number of people to anger by invalidating their purchase, then there is the negative message it creates which would put significant doubt into the minds of many when considering to buy a future Nintendo system, worrying whether the system will be adequately supported if it also fails to be a big success.

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Nintendo is currently at an important point in the life-cycle of the Wii U, the system has just reached the point where Nintendo now makes a profit on each unit sold making the system itself less of a risk to support. Traditionally Nintendo’s strategy has been to never sell a system at a loss, but this changed with the 3DS (which ultimately paid off) and has continued with the Wii U up until now. The GameCube, when compared to Sony’s PS2 was also deemed a failure despite worldwide selling around the same number as Microsoft’s original Xbox. Yet whilst Microsoft lost billions of dollars during that console generation Nintendo was still making a healthy profit despite the modest GameCube sales.

With Mario Kart 8 releasing at the end of the month as well as receiving numerous positive reviews, the coming months will be important for Nintendo. Especially towards Christmas with the release of the next Super Smash Bros title for the Wii U being Nintendo’s other system seller. Christmas will be the real test of whether Mario Kart 8 has the necessary pull needed to sell more units of Wii U’s, with Mario Kart Wii in the past selling ridiculously large numbers during this period.

Nintendo is committed to the Wii U, but that does not mean it is not thinking about the future. The company is already planning its next hardware release, and is likely taking in what it is experiencing now to facilitate a more universally accepted console next time around. The fortunate thing with the current situation is that the Wii U provides Nintendo with an opportunity to experiment and get the most out of a difficult situation, instead of just running away from it.

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This line of thinking is very different to that found in the West, particularly the United States. In the West many have criticised Nintendo for being too conservative in regards to its business operations, and some are surprised that heads have not rolled from the top, in particular Satoru Iwata’s Presidency of the company. Yet the thinking in Japan is that when times are tough, replacing the leadership at the first sign of problems would generate additional complications. That does not mean Nintendo, or Sony, have not recognised that there are problems; as both companies have cut the bonuses of the higher ups in some capacity showing individual responsibility for the current financial difficulties.

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Meanwhile at Microsoft, the only Western console manufacturer, things are quite different. Going back to the proverbs, Microsoft has made a big deal out of how it has chosen to ride its controversial tiger at full speed, but has backtracked on so many of its “core features” that were supposedly ‘intrinsic’ to the Xbox One experience that it almost looks like it is not committed enough to ride the tiger all the way. Just recently Microsoft made their biggest 180 since going back on the always online aspect, which was to decouple Kinect from the Xbox One at retail; a peripheral which was supposedly essential for the use of the Xbox One, despite the previous patch allowing it to be unconnected. This is opposite to Nintendo’s attitude regarding its peripheral the GamePad, as despite calls for a Wii U package that excludes the expensive controller, Nintendo has responded by declaring to be even more committed to utilising this core component instead of abandoning it. A decision which if followed through correctly, such as taking advantage of the inbuilt NFC chip for a Nintendo version of Skylanders, could be very advantageous for the system and financially for the company.

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Microsoft had a bold vision for the Xbox One, but it was poorly portrayed and the incompetently constructed PR campaign that accompanied it has cost the company, although it could have been more disastrous. Instead of rationally explaining the reasons behind the vision and the benefits of it, Microsoft doggedly stood its ground without providing any explanation. This was disastrous and has since had to go back on nearly every key element of that initial vision. The end result is ultimately a console which is less powerful than its main competitor, at the same price, with no discernible feature to make it an attractive alternative.

Nintendo is having a difficult time with its tiger ride, but is still committed. Sony as a whole is also facing difficulties, but its PlayStation division has made many good decisions and is benefitting from a smoother ride. Microsoft meanwhile is in a transitional phase, and its Xbox division is still having a difficult ride with there being little left to go back on, leading one to question the stability of the division’s commitment to its strategy, quickly wavering once things get tough. Just because Nintendo is defiant in its continued support of its system and its features does not guarantee success (as evident by its current position) but it demonstrates an act of faith which the public can rely on. Whereas Microsoft are so desperate to reclaim its once dominate position that it is now wavering on any aspect that the masses have a problem, even though in the long run this is actually undermining the benefits the console once had, making it redundant among its competitors. Nintendo might be afraid to dismount, but Microsoft lacks the conviction to stay on.

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Despite studying Politics at Undergrad and then War Studies at Master's level, James managed to write multiple essays relating to technology and more importantly video games.