Analysts Predict Nintendo’s Moves For 2016

The excellent site, gamesindustry.biz, has contacted several video game analysts to discuss what they expect will happen across the gaming landscape in 2016. They offer up predictions for the entire business segment, but I pulled out the nuggets that relate to Nintendo.

Michael Pachter (Wedbush Securities) is probably the most well known gaming analyst as he is often interviewed in gaming publications and has appeared on countless online videos. He often shows little love for Nintendo, and his track record has been far from accurate. However, his pessimism often gives us a glimpse at the worst-case scenario from Nintendo, and that’s always important to keep in mind, especially when it concerns the possible launch of a new gaming platform. Let’s take them one by one:

Nintendo’s first mobile “game” will flop. Miitomo will get 100 million downloads, so it will be a “success” in terms of users, but it will drop out of the top 100 grossing games on iOS and Android by year-end 2016. I think people will try it, but don’t think they’ll find social chat compelling enough to spend money. In my opinion, Miitomo offers little that isn’t already widely available on Facebook; younger consumers not on Facebook will probably find it appealing, but they typically have little or no access to credit, so Nintendo will have trouble monetizing Miitomo.

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I find it interesting that he considers the possibility of 100 million downloads of Miitomo to be a flop. I don’t think Nintendo is releasing Miitomo as a gateway to making millions of dollars. Sure, they need to be profitable on the endeavor, but I see it as more of a way to get consumers that don’t own Nintendo devices in the door. It’s a way to capture a part of the audience that has moved on or has never experienced a Nintendo product. Miitomo will be a way to get users to create Miis, interact with other players, and introduce people to the Nintendo ecosystem via in-game purchases, and the creation of a Nintendo Account that will feed directly into their 3DS, Wii U, and upcoming NX platforms. Basically, Nintendo will be able to open a direct line of communication to a swath of the gaming public that they currently don’t reach. If that’s the angle Nintendo is going for, and I truly believe they are, then 100 million downloads could feed into growing a bigger user base across their entire ecosystem, notifying them of upcoming releases and promotions for all of their devices.

Nintendo’s second mobile game will be a resounding success. I actually think Miitomo is intended to be a platform that allows people to create a personalized image/character and use it in other Nintendo games. I am hopeful that the second effort is something more familiar, such as a Super Mario platformer. If so, I think the game will attract 200 million downloads and will be a top 20 (or possibly top 10) grossing game on both iOS and Android.

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OK, so basically Michael thinks a Mario platforming game on a touch device would sell 200 million copies? I guess if anyone could figure out how to make a touch screen interface work with a fast-paced action game like Mario, it would be Nintendo. However, just repurposing a standard Mario game to mobile probably isn’t going to work. Virtual buttons are hated by many people and the accuracy needed to play a Mario game is hampered by the controls of a touch screen. I believe for Nintendo to be successful here, they’d need to create a new experience with the cast of characters they own. Or, adapt a series that would fit better on a smart device. For example, the Paper Mario series would be much better suited as they aren’t highly dependent on platforming, and the turn-based battles would work perfectly on an iPhone.

The NX won’t come out in 2016. Nintendo has a history of announcing consoles in one year and launching the next, and I don’t see the NX as deviating from that pattern.

Let’s take a look at Nintendo’s history of showing a handheld or console, and then when they eventually released in the U.S. The NES was officially shown off at the January 1985 CES as the AVS and it looked completely different than what was finally released. It didn’t receive the necessary interest from retailers (coming off the video game crash) so Nintendo went back to the drawing board and completely changed the design of the system and threw in a robot. They showed the NES, as we know it today, at the June CES in 1985 and got a few bites, but not enough to roll the system out nationwide. They tested the market in New York in October of 1985, and went national the following year. So, the NES debuted in January of 1985, and released (at least in New York) in October of 1985, giving it 9 months from debut to release.

The Game Boy was shown off at the June CES show in 1989. It released in August of 1989. That means it had only 2 months from first showing to release.

Although it had released the prior year in Japan, the Super Nintendo was shown publically for the first time at the summer CES in June of 1991. It would later hit retailers in late August of 1991. So, again there’s only about a 2-month wait from first showing to actual release.

The Nintendo 64 was first playable in the U.S. at the May 1996 Electronic Entertainment Expo (E3). It would eventually release in September of the same year, a scant 4 months later.

The GameCube was on the show floor of the 2001 E3 in May. It would later release on November 18 of that same year, giving it roughly 6 months from showing to selling. The GBA was also playable there and released the following month.

The DS was shown officially for the first time at the June 2004 E3 show. It would see release that November, 5 months later.

The Wii was playable for the first time at the June 2006 E3. It would be released 5 months later in November.

The 3DS was publically unveiled at the June 2010 E3. It would be the first Nintendo system to not hit retail that holiday season. It would eventually release in March of 2011. This was the longest wait so far – 9 months.

The Wii U was first playable at the June 2011 E3 show. It wouldn’t see release until November of 2012. That’s a whopping 17 months after it was initially unveiled.

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The Wii U was the longest wait – 17 months from first hands-on to launch. Hopefully the NX won’t follow suit.

So, looking at those dates, it becomes obvious that Pachter is really only correct about Nintendo’s historical record for the last two systems. Now, you might argue that Pachter’s official words state “Nintendo has a history of announcing consoles in one year and launching the next…”, therefore many of the dates I listed above are misleading because in most of those cases an announcement of a new system had already been made before showing it off at a tradeshow. I will freely admit that, yes, in many cases they had been announced or mentioned in advance of showing them. However, if we are to go by that metric, then we can say that the NX was already announced in March of this year. In which case, if we follow Pachter’s logic, it must be releasing next year.

Now, I’m not saying that the NX is releasing in 2016. In fact, despite rumors of the development kits already being shipped out and all of the patent talks, I feel there’s a very good chance it won’t come out in 2016. Why? Because Nintendo usually doesn’t like to rush a launch, and it may have found itself taking on more than it can handle with multiple initiatives occurring simultaneously. Not only are they juggling the 3DS and Wii U businesses, but they are entering the mobile sector, launching a new Nintendo Network and loyalty program, expanding their intellectual properties, and involved in the Universal Studios Theme Park expansions. It might just be too much to focus on in addition to launching a brand new gaming platform.

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Is Nintendo juggling too many projects at once for NX to debut in 2016?

The bottom line is I think it will depend on how far along game development is for the NX. If Nintendo has adequate games queued up for a holiday 2016 launch and their hardware manufacturing doesn’t see any hiccups, then we may see the NX next holiday season. Internally, I bet that’s what Nintendo is aiming for. However, reality often paints a different picture and if there are any delays in hardware or software production, then it could easily get pushed into 2017. The big problem then facing Nintendo would be how to keep software coming to the 3DS and Wii U if the NX is pushed.

Historically Nintendo hasn’t had a lot of software in transition years. If we look at the year prior to the GameCube, in 2000 Nintendo published twelve games for the N64. Three of them were Rare games (Mickey’s Speedway USA, Banjo-Tooie, and Perfect Dark), and three more were outsourced (Mario Tennis, Mario Party 2, and Excitebike 64). On top of that, games like Pokémon Stadium, Pokémon Puzzle League, and Ridge Racer 64 were also joint efforts. What that leaves us with is Kirby 64, Hey You Pikachu, and Zelda: Majora’s Mask, only one of which was truly done completely in-house. In other words, it’s obvious that Nintendo’s main developers were hard at work on the GameCube well ahead of its launch.

When taking a look at the Wii U release list, I think it becomes apparent that the same thing is happening this year and that development has shifted to the NX. For all of 2015, the Wii U saw the release of only nine Nintendo published retail games: Kirby and the Rainbow Curse (HAL Labs), Mario Party 10 (ND Cube collaboration), Splatoon (Nintendo internal), Super Mario Maker (Nintendo internal), Yoshi’s Woolly World (Good Feel collaboration), Animal Crossing amiibo Festival (ND Cube), Mario Tennis Ultra Smash (Camelot), Xenoblade Chronicles X (Monolithsoft), and Devil’s Third (Valhalla Games). The majority of these games were developed with the help of other studios. In fact, if we look at the games coming next year the only announced Wii U title taking up vast resources from within Nintendo’s internal development teams is The Legend of Zelda Wii U. Other games, such as Fire Emblem, Star Fox Zero, and The Legend of Zelda: Twilight Princess HD are all being outsourced. The same can be said of the announced games coming to 3DS. The vast amount of programming is already completed on these as the majority of games coming to the handheld have previously been released in Japan over the past few years.

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Has Nintendo shifted all major development to the NX?

All of this points to the possibility that Nintendo’s main focus is on the NX. Perhaps they will have enough content ready for a holiday 2016 launch. If, and this is a big if, Zelda Wii U is being created as a cross-platform title (similar to Twilight Princess on Wii and GameCube), then that would be one title ready to go for launch. I suppose if NX truly is merging the handheld and console markets, then there’s an even greater chance of software being ready in time, since that means more teams are working on titles for a single platform. The only thing we know for sure is that Nintendo has stated time and again that more information on the NX will be revealed in 2016. Whether that means a simple announcement, a full hands-on blowout at E3, or something else entirely, remains to be seen.

The rest of the analysts weigh in on what they think 2016 holds for Nintendo. I won’t comment quite as much on these as they aren’t nearly as controversial.

Patrick Walker (EEDAR) had this to say about Nintendo:

Nintendo’s NX’s unique selling point will be the ability to link the console with multiple handheld devices.

One thing that the modest performance of the Wii U has shown Nintendo is that a platform needs a significant selling point beyond Nintendo IP to gain third-party support and mainstream adoption. The Wii brought motion gaming to the masses and enjoyed breakout success, but the Wii U’s half-baked console/handheld approach failed to drive the same level of consumer interest. Nintendo’s press announcements, early rumors, Nintendo’s continued support of the handheld market, and the lack of a full commitment of Nintendo premier IP into mobile suggests that Nintendo will likely try to merge the console and handheld markets in the NX. Support for multiple handhelds is likely, considering Nintendo’s broader handheld strategy of having multiple handheld devices in a single household.

Billy Pidgeon (independent analyst) predicts:

Nintendo’s new NX system will represent a wholesale rethinking of online games, community and digital commerce for the company.

While Nintendo is relatively late to fully embrace remote connected gaming and commerce, I believe Nintendo’s new network and hardware will deliver an evolved multiplayer gameplay experience. NX will rightly be positioned as a system and network separate from Wii U and 3DS. 3DS will remain a thriving system for a number of years. Although Nintendo will sell more Wii U hardware as more highly anticipated franchises become available for the system next year, the system has lagged too far behind the competition to remain viable for most third-party publishers and should be managed accordingly. NX may be released this year, but Nintendo would be wise to delay launch until a number of quality launch titles are ready to ship.

David Cole (DFC Intelligence) adds:

Nintendo is in the News

In 2016, the headlines will be dominated with news about Nintendo with all kinds of unconfirmed reports about a new system. At the end of the day Nintendo will finally learn from past mistakes and reveal very little of its plans. DFC Intelligence predicts that a new Nintendo console system will not launch in 2016 as Nintendo learns from past mistakes and focuses on getting many developers on board with top-end content for a stellar launch.

As you can see, most of them believe that the NX will be, or should be, released in 2017. They may be right. I agree that if Nintendo isn’t ready with a steady stream of software and renewed third party support that it probably should take longer to launch the NX platform. However, it must be very careful to not leave a massive software drought in its wake as that could cause even more erosion into their market share as gamers become bored and move to a competing platform. The enthusiast in me really hopes the NX launches in 2016 as I’m always excited for a new Nintendo system. That being said, I also know Nintendo operates to the beat of its own drum and will release the NX when it’s good and ready.

[Quotes courtesy of gamesindustry.biz]

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