Nintendo’s New Direction – Part 2

In my last article, I posed the concept that not only are third party developers abandoning Nintendo and the Wii U (a well-known fact), but this lack of interest from Nintendo in third party titles is deliberate, and that said developers are leaving for that very reason. The developers want to make money, and if Nintendo won’t throw cash at them, they will stay with Sony and Microsoft.

Large third party developers making “AAA” titles will become extinct very soon if they continue on the path currently being traveled; high productions costs with high demand for ridiculous amounts of sales. In this regard, Kotaku did a decent outline of this here. The normalized relationship between third party developers and manufacturers also has to stop, as it seems to become more and more frequent that the developers begin to “boss around” manufacturers – they need to meet a quota in order to stay afloat, so it does make sense on their part. I think in a few cases of developers leaving Nintendo it has been a little personal, but for the most part, it is purely business.

A developer makes a game that costs them a small fortune, they demand help from manufacturers in order to get their business (the game, essentially), and they try to recuperate the costs of the title. From this perspective, I can fully understand the thought process behind the actions of a large game developer. But, as I stated before, this process and relationship between manufacturers and developers can’t last long. There needs to be some renovation to the general layout; a remodeling of the current system. This is where I think Nintendo has, and may even be taking, an opportunity to innovate the game industry.

If this typical way of courting developers to get their titles on your console needs to be overcome, how can a game system survive then? As we’ve seen with the Wii U, lack of third party support will not bring incredible sales, especially since many present gamers did not grow up with Nintendo necessarily, but rather Xbox or PlayStation. Third party titles are a must-have, right?

Imagine a game company designed to create the flow of its own titles, while working with (not bending to) third party developers. How might this look? Here is what I think.


Nintendo Creates Their Own Unique Set of 1st, 2nd, and 3rd Party Studios

I believe Nintendo is working towards creating their own tiered system of studios. 1st and 2nd party studios will largely stay the same, but the big change comes with the revised 3rd party layout.

1st Party Studios: These studios serve their current purpose to create the large “AAA” Nintendo titles, such as Mariokart 8, or the upcoming Zelda U. These titles will bring in massive initial sales, as well as great lifetime sales (see sales for Mariokart 8, Super Mario 3D World, Wind Waker HD, and New Super Mario Bros. U) that will continue to grow into large numbers. These are the main enticement for gamers: these are why you get a Nintendo system over another console.

2nd Party Studios: These studios, like 1st parties, will mainly stay the same. Nintendo will work with a studio to create Nintendo-centric titles. Examples of this are The Wonderful 101, and the upcoming Pokken Tournament. These studios aren’t necessarily exclusive to Nintendo, but they create games exclusive to their systems and may even have a preference to work with Nintendo over others. These titles may, or may not, bring in some large sales, but I would think they’d be more in the 500,000 – 1,000,000 copies sold range. These are not bad numbers at all, just not as large as the 1st party titles. These games would be more for innovation and creating new, unique gaming experiences, since Nintendo won’t be the sole developer.

3rd Party Studios: This is the biggest change. Instead of Nintendo (or any manufacturer, for that matter) courting large third party developers and doing all the work for them, they work with those studios that want to work together. Simply put, these are studios that want to work with Nintendo. For instance, the studio(s) that creates the Skylanders series would want to create games for Nintendo systems, as they typically would sell well. Third party titles would be the “bulk” of sales, because of two reasons: 1) they would be games that both developers and Nintendo want on the console, and 2) they would most likely be catered to a fairly large demographic of gamers. However, it wouldn’t stop there; most of what I’ve stated isn’t anything spectacular, nor is it a completely new thought. So, there would be the typical third party developers, separate from Nintendo, making titles for their consoles; there would also be another set of third party studios that Nintendo could “buy out.” Or, rather, a set of third party titles that Nintendo would revive, renew, or acquire via monetary means. Bayonetta 2, Sonic Boom, and the recent collaborations with Koei Tecmo (Hyrule Warriors and Fatal Frame 5): these types of third party games become psuedo-second party titles. Devil’s Third is another prime example of Nintendo swooping in to “save” not only a game, but a studio as well (Valhalla). Now, whether the titles interest you or not is a different topic altogether, since that boils down to simple preference. But, these titles are ones that were wanted (notice I’ve used that word quite a bit?)

Nintendo’s Quality of Life Program Will Generate Needed Revenue to Initially Replace 3rd Party Titles

So, there is a rough break down of the tiered system, but there are a few more factors that would come into play. For one, Nintendo’s Quality of Life program could be a very, very good thing for Nintendo gamers. Of course, this depends solely on how Nintendo handles promotion and marketing, but if they aggressively and actively market QoL, they can bring in a whole new area of revenue. This could, in a way, take the place of all these third party developers leaving; financially speaking. This market is aimed at not only those who rarely play games, but perhaps those that don’t play at all, nor even want to play. Why? Because QoL isn’t based in a gaming foundation, but rather, uses game elements to try and appeal to a larger market. The biggest obstacle to overcome here would be competition: Apple and Android devices already have tons of health service apps, and even Microsoft just announced the launch of their own health program. But, I believe Nintendo can do very well in this market, and begin reaching overall sales similar to how the Wii sold.

Nintendo Creates Three Different Types/Categories for Various Studios to Fill

Finally, the question becomes this: will there be enough games to justify purchasing a Nintendo system, when working within this new structure? The answer is yes, and I’ll explain – it lies within 1st party studios.

Within these studios, there could be three different categories, or sections, to fill game release calendars. Of course, acquiring or founding more studios is a must, and it would take time (hence why I think they are doing it now, during the life of the Wii U), but in the end would completely change how manufacturers view the industry. Here’s how I believe it could break down.

  • “Retro” Studios – There would be studios whose sole purpose is revising old/familiar IPs and revamping/innovating them to fit into present gaming. I could easily see a studio, such as Retro Studios (a very fitting name, right?), taking old Nintendo characters and reinvigorating the franchise. Look what they did with Metroid (Metroid Prime Trilogy) and Donkey Kong (DKC: Returns and DKC: Tropical Freeze). If Nintendo acquires or founds a few of these studios, they can release “nostalgia” titles regularly, and they could become more than just nostalgia. The above mentioned games have been incredibly well-received, and many would argue the Metroid Prime series is one best revamps of a franchise. These studios would create roughly 1/3 of 1st party games.
  • “Current” Studios – These studios would focus on newer IPs and franchises. Examples of this would be Captain Toad: Treasure Tracker, Smash Bros. For Wii U, Zelda U, Mariokart 8, and Super Mario 3D World. These studios could easily begin blending with “retro” studios, but their focus would be working on and continuing newer franchises (Zelda being the exception, here). Think of the Kyoto and Tokyo software development teams for these studios. There would be “veterans” of the game industry leading these studios, while younger employees work alongside them. In fact, this is already happening. So, these would work in tandem with “retro” studios titles being developed. These studios would take up another 1/3 of 1st party games.
  • “Future” Studios – These are the innovators within Nintendo software. These studios would be the ones bringing fresh, new ideas to gaming. I’m not saying that the previous two categories of studios wouldn’t be innovating and trying new things, but the sole purpose of “future” studios is to be 100% creative and innovative. Again, this is already happening with “GARAGE.” In fact, Nintendo showcased a few titles from this studio, namely Project Giant Robot, Project Guard, and the highly anticipated Splatoon. Each of these titles is a brand new IP, with either new ways to play that cannot be played the same way on any other console, or completely revising familiar concepts. For instance, Splatoon takes many caveats found in typical first person shooter titles and completely changes it. It is a first person-inspired game, that plays like a third person title; it also utilizes bright colors, a unique way to win, and incorporates online play. And, obviously, these would take up the remaining 1/3 of the 1st party titles.

With this structure, Nintendo could almost become self sufficient. Yes, there would be third party developers who still make games for Nintendo’s consoles; but they would be purposeful and wouldn’t “bully” the manufacturer. This way, Nintendo also gets larger amounts from the profits acquired with each piece of software developed, as opposed to getting a smaller cut with third party developers. In turn, if Nintendo is supplying the funding for all of these studios (which they could easily do), they would have employees that are more prone to make better products, due to job security. Satoru Iwata has stated he doesn’t support layoffs – though Nintendo recently had to cut positions filled by temporary employees at the European branch due to restructure, which doesn’t mean he has changed his mind. With so many recent stories regarding the vicious cycle with game developers, being part of a studio you have faith won’t be disbanded is quite a big deal. So, if Nintendo can make their founded studios look appealing, they can begin filling them up and creating new ones. This would help with quantity of games, without losing the quality of Nintendo titles.

And think of this: if Nintendo, during a “terrible” console lifespan thus far and lack of third party support can create at least one “AAA” title a month throughout 2015, imagine what they can do with the structure I just outlined.

Of course, there are a lot of unknown factors, but I can’t help but think Nintendo is about to renovate the gaming industry in their own way. 2015 and 2016 will tell us more about Nintendo’s new direction, but as for this Nintendo fan, I think they are aiming to become more self sufficient, and that could be a very good thing. In fact, it may be a great thing.

 

~Michael

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