According to Kaufman Bros. Analyst Todd Mitchel, Nintendo's success with the Wii and DS might come at the expense of third-party publishers who hope to gain traction on the these platforms. In his own words:
The DS and the Wii are taking the video game industry by storm. Both appear to be bringing new gamers into the market. However, this may not be a positive dynamic for the major video game publishers. Nintendo has not only increased the size of the market, but it has also re-segmented it in its own favor, in our view.
Nintendo is dominating software sales on its popular hardware platforms, leaving the publishers with a smaller slice of an only somewhat incrementally larger pie. Moreover, we feel that the likely shorter product cycles of Nintendo's platforms puts the publishers in permanent catch-up mode.
We think the upcoming releases of Super Mario Galaxy and Metroid Prime 3: Corruption will highlight this phenomena this holiday season.
As Next Generation points out, Mitchell is talking about the stranglehold that Nintendo's first party games have on their custom piece of the pie.
More, after the jump.
On the surface, he makes what seems to be a valid point. After all, Nintendo is very much taking over the market (even if it’s momentarily) right now, and they do seem to flourish with those blessed first-party titles that crush most other offerings of the third party variety. Taking into account that the combined software numbers of the DS and Wii for the 2007 fiscal year translated into about 152 million copies sold, and how first party Nintendo titles make up the vast majority of those titles, it’s not a complete stretch to say that Nintendo has control over at least 50% of its own market share on the software side.
To a developer who is trying to succeed on these platforms and make a profit in the process, the odds are very much stacked against them. In a sea of games that will undoubtedly be released for the DS and Wii (well, maybe) in the not so distant future, not to mention the limited budget that many families are finding themselves in, it’s going to be difficult for a publisher to have their game go up against the popular Nintendo titles and win.
Then again, business is business. If you take this away from Nintendo, the company might cease to exist. It is the equivalent of criticizing McDonalds for having trinkets packed in with their Happy Meals, or asking the dairy industry to give up its ads for milk mustaches. They have a limited market, and it has brought them much success in the process. By all accounts, most people would say that all is well.
There are two other readily available next generation platforms for lesser publishers to reach their target audience with, so what’s the big deal? Two or three years from now when Sony hits it’s stride, and the illustrious Xbox division finally starts to make poor old Billy some profits, the Wii might very well be the furthest thing from peoples’ minds.
Nintendo is focusing on its strengths, and is making a lot of money doing it at the moment. As far as fans are concerned, Nintendo is aiming straight for the heart, and taking names later.
Contest:
3:57 PM on 04.27.2007
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Hopefully, for the sake of Mitchel's love life, he doesn't fire off everything as prematurely as he did his analysis.
Now that's funny.
I hope third party step their game up and create something good.
SWEET!
Developers cant treat the Wii as a second choice platform and then expect first class rewards.
All this has already happened on the DS, third party developers are now making big money on the DS once they stopped using it as a GBA port machine for quick cash.
Basically I'm saying if developers put in the effort then they will reap the rewards, it's simple really and needs no analysis or debate.
Nintendo is the only developer who gets shit for making thier games "too good." Boohoo to third parties who can't sell any copies of some shitty port they threw together when they saw Wii sales soaring.
Here's a secret for 3rd parties: You know how you make a profit on Nintendo consoles? Make games that are as good as Nintendo's. That's all there is to it.
I mean just taking a PS2 game and adding waggle isn't going to exactly thrill gamers.
If the third parties are bitching about not making money, they're going to have to do what Nintendo did and change their market audience. If that means a half dozen less WWII shooters per year, I'm all for it, honestly.
Nintendo was right to say the market is stagnating. It clearly is if the market can't think of anything more original to do with the Wii controller than map out controls for FPS and driving games.
I think this summer's Harry Potter, Madden 07, Trauma Center, and Cooking Mama are proof that SOME 3rd party devs get it. It's just a matter if they'll continue to innovate.
Good point Zardoz. The devs are JUST now realizing that the Wii prints just as much money for nintendo as the DS did and that they'd be stupid to not get some shit out there. Hell, put a OMGPONIEZ! Title out there or something. I'd use my wii on some poniez... Since I'm not allowed to come back on the farm anymore...
Also I'd like to thank Niero, Workman, and Summa for having the patience to deal with the newbie.
Also, cocks.
If this is your formula for developing Wii games:
1. Take a PS2 or XBox 360 game.
2. Add waggle (thanks tratch!).
3. ?????
4. Profit!
Then don't whine when I only buy first-party Nintendo games. I've had enough of crappy shovelware ports last console generation.
When Nintendo stole E3 right then and there developers should have taken heed to get a larger share of the "new pie" Nintendo has created.
Besides, poor 3rd party sales? IIRC, Red Steel sold pretty well despite its mediocrity, and Raving Rabbits did well, too. If anything, 3rd parties are failing on the Wii because of their ports.
I gots no sympathy for the devs.
That's a totally real Nintendo edition Monopoly. I want it too, but I can never find anyone who's willing to play Monopoly with me.
I picked up one of those Mario monopoly boardgames at the Compusa that is closing here in my hometown. Only cost me 8 bucks, I got it made son!
I'm so jealous. :(
I'm so jealous. :(
It's also not the devs fault that their wii games are sub-nintendo standards. Nintendo made the hardware and has all the resources to develop games on their hardware best. They also have millions to sink into making games for their systems. It doesn't matter if twilight princess cost 10 million dollars to make. It is a Zelda title and a proven seller. Who in their right mind as a 3rd party dev would raise 10 million to make their own rpg to compete against Nintendo games. With only 6-7 million wii you will need to sell around a million copies to make a profit. You will also have to do it before other NINTENDO first party games steal the lime light away and relagate you game to the back row.
Nintendo has never been all that great to developers.
2. Ask them to list their most anticipated or favorite games for those systems.
3. Check how many of those will actually be on the Wii as well.
4. As for any multiplatform titles: check release date compared to other versions; check if any additional content are made for later released ports; check for any features added, improved, or removed.
*5. Check for graphical quality and control quality (as oppose to tacked-on, wishy-washy control efforts).
Not all Nintendo games steal the limelight as not all of them are that big a deal. Not all of them sell great either. As for other systems, there have always been top dog developers that occupy those territories too. There will always be games like FF, MGS, GTA, Gears of War, etc. that will steal the show. It's no different in a Nintendo system with Nintendo games. Heck, I'd say you've got more competition from multiple developers and publishers. The problem with third-party games on Nintendo system is that those games I mentioned aren't the ones coming out to compete with Nintendo games (and I mean the big games and not just any old Nintendo game, which as I've said don't all sell great).