Monday, September 19, 2005

The Revolution Revealed

When Nintendo’s Satoru Iwata showed off the empty shell for the Nintendo Revolution this past may at the Electronics Entertainment Expo, he promised the world that the real revolutionary aspect of the console hasn’t been shown to keep it secret from Nintendo’s competitors for a while longer. In due time the world will see it, he promised. Iwata has kept his word and this past weekend, in his keynote address to gamers in Japan at the Tokyo Game Show, he revealed the controller to the Nintendo Revolution. To the surprise of everyone, it was totally new, strange and unique. It is a wireless ‘pointer’ which allows for manipulation of objections in real 3-D space. Imagine a futuristic type 3-D mouse than allows the user to select objects, menus and groups of units on a screen by simply waving their hands around with the controller. Not unlike what we saw in movies like Minority Report. Held horizontally, it also doubles for a NES controller. Nintendo certainly hasn’t forgotten its promise of a virtual console with a back catalogue of old Nintendo games. This video may help you visualize what it is all about.

Industry reaction so far has been positive, and so has the gamer reaction. While hardly the arbiter of mass market tastes, oracles in Internet gaming forums have long predicted that the Nintendo controller would be so weird and self-serving (for Nintendo) that it would be a disaster for the company. When the controller was revealed on Friday, the reaction was downright jubilant and enthusiastic, the opposite of what had been predicted. After the recent DS’ triumph over its rival, people seem far more willing to believe in Nintendo’s promises of revolutionary new ways to play games. Under different circumstances, the Revolution might have already been dead in the water. Fortune is smiling on the company this time around.

The concern about third party shovelware support raised by more cautious journalists, developers and gamers is real however. While many gamers will likely not want to buy the latest version of Harry Potter on their Revolution, many casual gamers undoubtedly do want those kinds of software. Anyone who has been through a basic business strategy course can point to the ‘network effects’ that helped propel the PlayStation, VHS and the Windows operating systems to their dominant status. Put simply, each new piece of software written for the machine adds value to the consumer to purchase that particular machine over rival machines and Nintendo certainly risks alienating third parties who may find it difficult to port their games to the Revolution and that in turn may reduce Revolutions overall game library and hurt it over the long-term.

The flipside of the argument however is two fold. First, Nintendo’s GameCube is in many ways simply another indistinguishable entry in a three-horse console race. And despite having far more support than the Nintendo 64, it has floundered. The argument for simply having more third party ports on the Revolution may therefore not be very convincing. Secondly, Nintendo has promised that a controller sleeve that can be fitted around the remote control contraption and turn the Revolution ‘pointer’ into a more traditional game controller. Coupled with rising development costs on rival consoles, which a Japanese developer recently estimated to be between two to two and a half times of the current costs, Nintendo’s promise of an easy low-cost development environment may prove to be more attractive to developers wishing to develop original content and allow reprieve for shovelware developers to port ‘Revolution-ized’ versions of their games for peanuts and still be able to recoup enough money from Revolution game sales to spread the cost of their investment in game design on the Revolution. Put simply, if developers can port their games cheaply enough and still turn a profit, they’ll do it, even if it involves some tweaking of the control scheme.

The bulk of the work however remains with Nintendo. What made the Nintendo DS such a smashing success in Japan is the fact that Nintendo and select third parties actually backed up their talk with results. Nintendogs and a seemingly benign edutainment software called Brain Training have ruled the charts in Japan and beaten more traditional games in part because the DS did in fact reach out to a segment of the market that wasn’t being served and they have responded. In a frontloaded Japanese market where most games do well on their first day and quickly fade away, Brain Training has remained in the top 10 for more than three months, beating out major releases from Square-Enix, Capcom, Namco and even Nintendo itself. Furthermore, behind the Nintendo branded DS software is a slate of original and interesting games from Konami, Capcom, Namco and a slew of smaller development housing making interesting games that ranged from revivals of old adventure RPGs to unique ways of playing old genres, such as Castlevania or Trauma Center. All of this increases the network effects for the DS by making its unique features more appealing.

To repeat the same success, Revolution can’t be a bunch of hot air. One or two great games in the form of a Mario or Zelda game can’t solve the problem either. The retort would simply be that ‘Nintendo can make these kinds of games, but no one else can.’ Konami, Namco, Square-Enix and EA must also have their greats waiting in the wings for people to be truly convinced. The ball is in Nintendo’s court.

Press Start and let the revolution begin.

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