Whenever you talk to a Nintendo fan, there are two topics that are absolutely off-limits: Nintendo ditching its portable-gaming devices and the company bringing Mario to the iPhone. Upon even bringing up those topics, you can expect to be dealt some serious name-calling (“idiot” is usually a favorite) and a slew of reasons you’re wrong.
But when you cut your way through all those reasons, they usually all come back to one simple fact: Nintendo and its faithful fans believe portable game devices and Mario are synonymous with the brand, and therefore, the strategy surrounding them should never change.
Not to stir up a hornet’s nest, but I think that argument is nonsense. In fact, I think it’s about time Nintendo gets out of the portable business entirely and starts offering games from its many popular franchises, including Mario and Zelda, on smartphones.
Let’s first start out with the obvious reason Nintendo should follow such a strategy: it’s a public company with a responsibility to maximize shareholder value.
If you’ve been watching Nintendo’s financial earnings over the last year, you know that the company is suffering. It continues to see significant declines in revenue, and in most cases, steep losses that it can’t keep up for long. Currently, a key component in those losses is the decline of its portable business, led by the disappointing 3DS.
If Nintendo were to ditch the portable business, the company could significantly cut down on expenses, since developing hardware can be costly. What’s more, it can bring its top franchises — which are still wildly popular around the world — to hundreds of millions of handsets. At even $5 per game, the potential financial upside for Nintendo could be huge.
But there’s more to this than just finances. The marketplace is changing rapidly. Years ago, people were more than willing to buy dedicated gaming devices. But now that compelling titles are offered in the Apple App Store or Android Market, they’re starting to change their minds. Why not buy a $200 iPhone that can offer calling, games, e-mail, and much more, they ask, rather than invest in a $169.99 Nintendo 3DS that really only excels at gaming?
Like it or not, the future of the gaming business is in digital content. Nintendo, so far, has been loath to embrace that, only offering legacy games digitally through its Virtual Console offering. But there is a big digital-gaming world out there that it hasn’t explored, even though it has the most popular game franchise in the world.
Something just doesn’t add up.
I’m all for nostalgia, and I, too, look back fondly at the old days of gaming. But times are changing. And the companies that don’t embrace that will fail miserably. Right now, Nintendo is at a crossroads. And until it realizes that, and drastically changes its strategy by making mobile Mario games platform-agnostic and ditching portables, the company will continue to suffer.
Sorry, but sometimes, the truth hurts.