Nintendo 3DS – A Broken Business Model

198 Comments

Nintendo’s soon-to-be released 3DS device is causing a stir in the gaming industry. But there’s a caveat hidden in all the buzz.

On Monday, well-known gaming industry analyst Michael Pachter released a research note proclaiming the forthcoming Nintendo 3DS would “revolutionize the gaming industry.” His belief was based on the new device’s 3D experience, which he says will not only spur sales of gaming hardware (he predicts Nintendo (s ntdoy) will quickly sell 10 million units), but also raise prices of software.

As I discuss in a post at GigaOM Pro today, Pachter may be right about the company being able to sell 10 million units fairly quickly, but he’s wrong about the overall prognosis for the 3DS.

The problem isn’t so much that the 3DS won’t be a unique gaming experience, it’s that the device, and with it, the gaming experience, is built around an antiquated business model popularized over 20 years ago by Nintendo and the Gameboy. With the Gameboy, Nintendo created a model centered around the release of a new generation of hardware every five years or so and by the sales of expensive software titles over the life of the device.

But in an apps-driven world where the iPhone and iPod touch rule (and Android (s goog) is making huge forward strides), this model poses a couple of different problems.

The first is the hardware life cycle and associated pricing of 3DS. Nintendo has already seen the impact of the iPod Touch, and at a likely price of $250, the 3DS may not be worth the money when compared with Apple’s (s aapl) offerings. (While the iPod touch currently tops out at $399 from an entry point of $199, it offers consumers more bang for their buck.) And as for five-year hardware cycles, that’s a lifetime for consumers who have grown accustomed to a new iPhone every year.

However, the bigger problem for Nintendo and the 3DS is the software model. Nintendo has grown rich on a model premised on tight control of select software titles through approved partners. These partners traditionally release expensive titles through brick and mortar and online stores.

That model worked in the past, but not in today’s market. The app-store model has unleashed a wave of innovative new games (36 thousand at last count) from hungry developers looking to free themselves from the long, expensive and highly restricted development cycles associated with traditional console gaming. In comparison, Nintendo’s process is the mobile game software equivalent of the Soviet Union: too much control, artificially inflated prices, too little choice.

Nintendo may have re-invented handheld gaming with the DS, but the visual trickery on the 3DS won’t be enough to create a sustained multi-year sales cycle. The device is doomed, and Apple killed it.

Read the full post here.

Image Source: flickr user Colony of Gamers

198 Comments

Manuel

You’re totally wrong!!!!
I know that iPhone is a success… but its games are not even compared to console games!!
The games you can play on a Nintendo handheld system can’t be played on any other system, that’s what makes this new device so successful.
To give you an example, I don’t care about the 3D effect, I was ready to buy the next DS only for the software… for the games.!

Karen

I don’t agree with this article. I can’t see a gamer going out and getting and iPod touch just for the latest games. Music, sure, but not games. Big series like Mario, Zelda, and Pokemon will never come to the iPod. This Christmas, many of my family members had options of getting the iPod for its apps, but instead they got the DS. Many of them are young children. Most parents that I have met do not want their elementary school children having the iPod. It easier to break than the DS and it lacks the games children want to play. For some parents, the internet and YouTube just add to the reasons they don’t want their children to get an iPod until they are older. While I see Nintendo having to change its product because of the iPod, I don’t see their products dying. Nintendo has been playing the game far too long to let that happen.

Donnie

One day this article will be legendary and “Wolfing” will be a new term for how to get something just about as wrong as humanly possible.

Your making yourself look incredibly foolish, talking about the “app driven world were Iphone/Ipod rules”. Its a phone/music player that people download cheap programs too, its not in the same league as a real games system (look at game revenue) and never will be. For two main reason, one is life cycle (which you so bewilderingly claim will be Nintendo’s down fall). The life cycle of a real handheld games system is essential. It allows developers to invest in a long term strategy of building new game engines that will be used in current and future games. They can’t do that if the system’s only going to be around for a year before a new one comes out and the old ones are thrown aside. For that kind of life cycle developers could only ever make low budget games, which will never allow the system that supports those games to be taken seriously. The second reason is the fact that designing a phone and designing a games system require quite opposite things. A phone should be cleanly designed, little but a touch screen and/or a few buttons. While a games system requires d-pads, sticks, plenty of buttons ect If you include those things the phone is ruined, if you don’t it can’t ever be a serious games system, why does this very simple fact escape certain people? Please stop living in your dream world and wake up, if only in order to try to stop yourself being s laughing stock in a few years time.

lonegunman

“It allows developers to invest in a long term strategy of building new game engines that will be used in current and future games. They can’t do that if the system’s only going to be around for a year before a new one comes out and the old ones are thrown aside.”

The iOS software is based on frameworks that have been around for about 20 years. An upgrade in hardware doesn’t mean you have to throw out code and start from scratch. You just tweak for the new features.

apk

Game systems have buttons. iTouch doesn’t have buttons. Do the math.

Michael Wolf

Again – this article is forward looking over the 3DS product life cycle.

The 3DS comes out next spring – another whole product cycle away for Apple and Android. Imagine Apple drops the price on the iPad by $100 early next year. Then another $100 the year after that. I think we know there will be high-quality games on the iPad, and at similar price points the 3DS will no doubt suffer in sales.

You're no good at this.

If you were, you would see a flaw in your argument. You assume there will be high quality games on the iPad (and you seemingly go on to compare their production values to the upcoming MGS 3DS) and at the same time you go on to praise the low prices and accessibility of the apps on the Apple marketplace. Problem is, no one is going to make a game with the production values of a MGS on the iPad, because they wouldn’t see a substantial return on their investment due to the shovelware nature of said marketplace, and the forced low pricing structure. iPad users wouldn’t be used to or willing to pay the higher price required for a game of that caliber. And due to the different processing abilities of iFamily products, you don’t have the entire iPod/iPad/iPhone userbase to make up for this. They would be relying on the highest end of their high end market and that is just not a sustainable situation.

Steve B.

Apple never drops their prices, they just improve their product. Look at their laptops still twice as much as their PC counter parts. Iphone still $600 without a contract and $200 with a contract.

And who say its coming out all the way in March, it very well could be allot sooner.

Sony Fanboy

But that doesn’t make sense, everyone knows Nintendo makes real games. Thats why there prices are high. There nnot even that high. the average DS game is
30$ which isn’t that much…

Kevin

I’m not buying a $500 ipod (with a glass screen!) for my seven year old.

Thirty-six thousand games? Really? You think that’s even a meaningful number?

DT

Wow, Apple killed the 3DS? I’m willing to bet that won’t happen. You should put your money where your mouth is. 3DS is going to dominate not because of 3D visuals but because it will have a great line up of real games, unlike the majority of games for the iphone/ipad.

Reasons why the 3ds is so highly anicipated:
1. Great line up of games.
2. Good 3rd party support.
3. Amazing graphics. (most powerful handheld console to date.)
4. Optional 3D effects without glasses(3d slider).
5. Plays 3D movies.
6. Takes 3D Pictures.

Apple is going downhill with their iphone 4 problems and the useless overpriced ipad. Microsoft may have to save them again.

asdf

I hope Michael Wolf doesn’t consider himself a journalist. I heard the good journalists actually do, ya know, RESEARCH.

But he didn’t – otherwise he would know how unintelligent this article is.

If I had to guess, he’s read up on all the positive press the 3DS is getting and in an effort to get a bunch of hits on google (for the next couple days) he bashed it and is loving the attention.

Good job, dude!! Your mom would be proud!!

nathan

Although it’s not much, they already make cheap app store games on the dsi, and they will definitely expand on the 3ds, but an iphone will never play the high quality games that you would get on a dedicated handheld system. Plus the author of this article said it himself; a handheld nintendo system lasts for 6 years so you DON’T have to buy a new model every year. So you can either spend $250 on a 3ds and buy more expensive high quality games and have it last for 6 years or you can spend $200+ a year for 6 years on an iphone that plays little cheap games. hmmmmm what sounds better?

MrGeddings

Yeah this article isnt that great. Your comparing the Iphone and Ipod Touch with a dedicated video game handheld system. the ipod really doesnt have any “must have” games on it. Sure the games will be higher priced but in most causes they will be higher quality. besides It seems Nintendo may be branching into more download options as well. I dont think 120 Million Nintendo Ds’s (overall) sold is a broken business model. This is really a poor article that basically says if you dont have a model like apple you are doomed to fail.

Nintendo has been in the handheld market for 20 years and it has shown no sign of slowing down.

Raymond Padilla

You say this as if you know what the 3DS’ digital distribution model will be like. Why don’t you describe it since you seem to know it well.

Nintendo has fully admitted that it executed online play and digital distribution poorly. It aims to change things with its next-gen products, starting with the 3DS.

Michael Wolf

@Raymond – unless Nintendo significantly changes their pricing structure – which I’m pretty sure they won’t – the model is antiquated.

Shawn

I own an iPhone, iPod Touch and iPad and I intend to purchase a 3DS. Why? Because I, like millions of others, enjoy tangible products. Yes, its true that with the Apple products you can download everything and anything, but you miss out on the tangibility. The problem that arises is you are no longer able to sell the games to your friends or trade it. Yes, it’s true you can lose the tangible product, but you can just as easily lose the iPod touch games as well — it’s called reformatting the PC. And Apple has in their terms of service that they are not responsible for your loss should you delete the software.

Furthermore, Nintendo’s continuous release of quality products ensures that the product will be a success. I agree that some of the games are being rehashed far too much (Zelda, Mario, etc.) but this generation has already proven to have some amazing releases including Metroid, Dragon Quest IX, and the continuing hit Pokemon. Apple lacks the established franchises that comes with Nintendo, and that is why Nintendo will succeed.

Your argument stands no ground in the world of true gamers because we like tangible controls though, not some touch screen.

Michael Wolf

@Shawn – as you say, you’re a true gamer. True gamers – the hardcore market – they’ll buy every console. The fat part of the market is the casual gamer. That one is much more up for grabs by alternatives. That’s where Nintendo will have much more trouble.

Chris

But Nintendo created the boom in casual gaming. Many casual gamers’ first proper experiences will have been with the likes of Wii Sports, Nintendogs and Brain Age. Many of them therefore trust the Nintendo name and as a result will doubtless be interested in the 3DS too when the marketing push really begins and it becomes part of the public consciousness.

Nintendo called it perfectly back in late 2004 when they said the company’s future success would be down to getting non-gamers involved, and people sneered at them then. I don’t think it’s wise, then, to say Nintendo will have “much more trouble” grabbing the casuals this time around becasue they’re already experts at getting them on board.

This article is made of fail

Mario and Zelda rehashed? That would be Pokemon and Dragon Quest, good sir.

The Mario and Zelda games keep the core formula the same (obviously), but always bring something new to the table to keep the franchises fresh.

I’m sure top gaming journalists would agree with me on that point.

Of course, you don’t have to take my word for it, but, if you would, check review aggregation websites and see which franchises stand as la creme de la creme. If that doesn’t convince you, see the the numerous “Game of the Year” awards that both Mario and Zelda have accumulated.

Here are some numbers...

iPod touches sold: 32 million
Nintendo DSs sold: 129 million

Whoa, Apple sure killed them.

Michael Wolf

Not (ahem) Apples to oranges. iPod/Touch has only been around 3 years, the DS for close to 6.

App-store was introduced in June 2008, making it only 2 years old.

Quarterly, iPhone-Touch is now outselling Nintendo handhelds. I haven’t even looked at Android.

Chris

How many people are buying the iPhone/Touch purely for games though? You can’t fairly compare a phone with a game system. That’s like saying a mall gets more visitors than a clothes store. Some people may go to the mall to go shopping for clothes, but there are many people people who go for other reasons too.

Gadgets

Really that is your comparison? Dude, stop drinking the kool-aid mr. wolf.

Robert Gunnysack

Well I’m glad I didn’t listen to an actual game industry analyst and/or my own preferences. Thanks for letting us know whats up even if you are dead wrong. I wish I could get a job writing fake blogs on Apple’s behalf.

Pichael Machter

Well, you have to applaud the audacity of the commentary. The traditional video-game media has been carefully, incrementally creating the Apple-is-killing-Nintendo narrative (never showing any real numbers or doing any due-diligence, of course, which is standard behavior for the industry-controlled media), but this guy skips right to the end and just declares a product “dead.”

I guess it’s better in that it saves us all time we would have otherwise wasted reading IGN editorials saying as much. And it gives us some great quotes to one day look back upon as we shake our heads and wonder why they never learn.

Mike Oliveras

I agree. It seems that everybody has it in for the games industry in some way or another, saying that it as a whole is “evil” or a key part is now “antiquated” without any solid grounds to make there accusations and commentaries on.

For me, this story ranks somwhere near the anger inducing Julie Peacegood discussion about videogames. But not quite as it is kind of laughable because we’ve all seen Nintendo come under threat from new devices and triunph. Granted everything that the Gameboys and DS’s have had to compete with were also game handhelds but they all tried to make Nintendo’s way of doing things outdated, and now look at them.

For those who don’t understand about the Julie Peacegood discussion: http://www.youtube.com/watch?v=5_9nj-Xngpc

Michael Wolf

Unless someone can show why they think Nintendo won’t suffer significant market share erosion in portable gaming from new alternatives available on the market, then I’ll stand by my argument. Iwata himself has called Apple the enemy of the future (http://www.destructoid.com/nintendo-apple-is-the-enemy-of-the-future–173159.phtml) – so I’d suggest Nintendo themselves are probably asking how the multiyear sellthrough of the 3DS will be impacted by what Apple and Android and others may do.

This article wasn’t about the next 12 months – it was about the life of the device. What if Apple decided over the next 2 years to drop the price of the low-end iPad by $200? Then it’s an iPad vs. 3DS argument, and you tell me which one a kid would want.

E

“Then it’s an iPad vs. NDS argument, and you tell me which one a kid would want.”

I think you just answered your own question there.

Mike

“Then it’s an iPad vs. NDS argument, and you tell me which one a kid would want.”

…a 3DS?

KDH

Except your argument is flawed. From the perspective of a gamer, the iPad/iPhone/Android/etc. gaming experience is an alternative to the DS/3DS/PSP gaming experience in the same way that SPAM is an alternative to fillet mignon. There’s just no comparison.

Michael Wolf

@KDH – iPad is spam to the 3DS filet mignon? Really? Tell my kids and a lot of other kids I’ve seen who’ve put down their DS’s and have death-clutches on their parents’ iPads.

Listen – the 3DS will sell – it just won’t sell nearly what the DS has. Unless Nintendo suddenly changes their pricing models, opens the system up w/tools in place for creative 1 and 2 mans shops to get a game on the console in months from concept to publish, and Apple and others stay completely static (which they won’t), this is just the way its going to play out.

KDH

Did you just skip over the phrases “From the perspective of a gamer” and “gaming experience” in my last comment, or do you just honestly think gamer=kid?

Regardless, I will admit my analogy was a bit flawed for the point I was trying to make (though I still hold it to be true in every other way), let me try to make it a bit clearer: Gaming on iPad/iPhone/Android/etc. is like an afternoon snack. Gaming on DS/3DS/PSP is like a five course meal at a five star restaurant. That’s why people ARE willing to pay more for games on those platforms: quality, and more importantly, substance.

Steve B.

Not an iPad, iPads are for cats ;). (http://www.youtube.com/watch?v=K1wWPdF6TZE)

Honestly, 10 years down the line it won’t be the same argument at all, some other device will come along or Nintendo will have change the market totally again to reflect what they see the future as being.

I can’t imagine a kid actually playing an iPad, the touch is pretty response by the gyro wasn’t making some games unplayable.

Permafry_42

these articles full of baseless conjecture and illogical opinion make me laugh. what made this 1 especially hilarious is the comments this fool made under it. This quote in particular made me fall over from laughing: “What if Apple decided over the next 2 years to drop the price of the low-end iPad by $200? Then it’s an iPad vs. 3DS argument, and you tell me which one a kid would want.”

1st off what happens EVERY TIME when apple price drop hits?? a new model. why do you REALLY think the ds is selling less? because a new model was introduced. 2nd kids are not the majority of gaming platforms. heck, they aren’t even the biggest minority. and lets face it mario, zelda and the nintendo brand in general STILL has a lot of influence in the market. 3rd the ipads are big. and expensive. and unlike the current 3ds build they have easily-damaged screens. if i had a choice between giving a kid a large, non-foldable and expensive device or giving them a foldable, pocket-sized device made by the company known for superior customer service, i know where i’d put my trust in. i’m sorry, but you really need to stop having an apple bais when you make a “professional” article.

JD in Marietta

I think I read the argument that people prefer to spend $200 – $400 every year for new hardware. Hmmmmm….I don’t think many will agree with that.

(And as for five-year hardware cycles, that’s a lifetime for consumers who have grown accustomed to a new iPhone every year.)

Robert Gunnysack

wow, I’m glad I didn’t listen to an actual gaming industry analyst and/or my own preferences. Thanks for telling us whats up even if you are wrong.

rahnyc4

difference between the iphone/ipod touch is that the ds and 3ds put out high quality good games, which people can rely on. These apps on the iphone can’t nearly top the quality that the 3ds offer and the true real gamers will always gravitate towards the Ds series.

Theres a reason why a place like pax will always be full of people who own a DS when compared to people who own a iphone/ipod. The reason being that people, the real games are on the Ds, the ipod touch is just a appetizer for casual none game players, most of whom only use it for mostly music anyway.

Paul

Yes what you don’t take into account here is.

:: The 3DS will have cheap games to download. And it will be open up more to garage developers who want to create a downloadable game.
So cheap apps will also be available on 3DS, alongside with multi-million budget games.

:: Apples own business model pushes away gamers. I as a gamer want to have the option of buying one console, and not needing to upgrade after a year, in-order to play all the newest games.

Every year Apple releases a new improved spec phone. If I want to play my games to full extent and get the most of them, I need to buy the newest hardware.

:: No buttems, playing games on my sis iphone is a pain.

Note im not a nintendo fanboy, I never owned a portable console before. 3DS most likely will be my first.

Martin

About the 3DS iterations, don’t worry, Nintendo already did that well before Apple (see Gameboy, Gameboy Pocket, Gameboy Color, Gameboy Advance, Gameboy Advance SP, Gameboy Advance Mini, Nintendo DS, Nintendo DS Lite, Nintendo DSi, Nintendo DSi XL)

About the tight control of approved software, it seems the author is quite misinformed since that model has been scrapped since the DS/Wii era, else we wouldn’t be plagued with tons and tons of unwanted shovelware on both machines, which by the way the App Store also suffers from.

The author also seems to be uninformed about the 3DS’ capabilities since it is also a music player and a 3D Movie player (first in market to do this).

Just watch the 3DS become the best selling videogame device by a large margin.

Michael Wolf

@Martin – have they changed their pricing structure? No. Pachter predicts pricing for software will go UP. Unless Nintendo loosens control, lowers overall pricing, it will see market share erosion for its handhelds.

Martin

Pacther predicts many things and he is rarely right, he’s not the source that you should listen to for your analysis.

And Market Share is a relative metric, I remember that article that showed Apple eating the DS market share. It went from 75% to 70% but even with that drop and going by the cold hard numbers, Nintendo profited more than the previous year with a higher market share.

Cell phones are evidently more commonly used than dedicated videogame devices, so it is natural that eventually Nintendo will have a very small % of the market share pie, that in no way means that they will lose their place as the number one moneymaker in the videogame industry.

Steve B.

Your silly, haven’t you noticed Wiiware and seen the patients for 3DSware. They have a download model, and one on the Wii that needs some improvements but actually works really well. They also know developers in the market really well. The developers are very excited about from Konami all the way to EA. It will sell very well with the gaming community and you can expect another 100 million seller. And if you check studies and the sales of the PSP Go people are still stuck on physical media. So they get you coming and going which is actually a better business model.

Other than the no AO rating games allow, they are not very strict. So that doesn’t make sense.

Oh come on now!

I’m sure the user wrote this article on his iPad while sipping a Martini on the beach.

Seriously, guy, stick to what you know. And what you know certainly isn’t the handheld videogame market.

Michael Wolf

I actually wrote it on my 100 foot yacht while I smoked a pipe and drank jack and cokes. I was throwing Nintendo DS’s over the side as I typed.

Ben

Actually that would be unlikely since the iPad doesn’t work all that well in the Sun, but hey, maybe he can go inside and play a rousing game of Plants vs Zombies, the iPad killer game app.

Level-Headed Person

Do these Apple fanboys really believe the spiel they’re writing?

Edgar B.

Oh come on. The article is so apple-oriented. This Apple model won’t be capable for every business.

Videogames is a big industry that needs a big amount of money coming. And I’m not talking about those cheap games you can mainly find on Apple/Android stores, but great titles that are made with a big teams, thousand of hours and money. Of course there are independent games, but you can see statistics and succesfull games always come from medium to big studios.

I think you are thinking about the N3DS such as a multipurpose device, when everybody knows that Nintendo focus on gaming. But I don’t know, maybe this deserves to be much than that.

By the way, the last sentece is so terrible. Doomed? This is a success from now. Just have to read the reviews from the industry.

Michael Wolf

@Edgar – If product success was determined from pre-launch reviews rather than sustained multiyear sellthrough, it’d probably make the lives of the CEO much easier :)

Edgar B.

You are misunderstanding my words.
I’m not talking about critical reviews, but review from industry related specialist. When people who design, develop and programs talk very good and look excited about a new tech it’s a good sign.

Torrey

Where as the iphone and ipod touch are leading the market for apps and downloadable games – They still don’t compare to the experience of a traditional handheld. Its true that they are getting closer and that compelling game ideas are coming forth from developers incorporating the touch screen and tilt features. But for those of us looking for a deeper experience with analog control, apple just doesn’t cut it. The games I play on my phone are for roughly 5 to 10 minutes at a time, where as my DS gets played from 15 minutes to hours at a time. Nintendo and Apple represent different markets in the handheld world, but both are taking steps into each others territory. Apple with their more compelling games and Nintendo with their download store. I feel Nintendo is closer to encroaching on Apples territory than the other way around. Also in regards to a new iphone every year – The advancements made are similar to the DS, DS Lite, DSi and most recently DSiXL coming out every year or two.

Nav

I’m not sure about this. The App Store has been around for some time, but there doesn’t seem to be much data supporting the idea that it has harmed either Nintendo’s hardware or software sales yet. They sold 500k+ units in the US alone last month.

Additionally, it’s likely that the 3DS will also have its own download service, for smaller, bite-size games like those available for iOS devices.

If what you’re saying is true, why hasn’t the App Store affected Nintendo’s business model in the 2 years it has existed?

Michael Wolf

@Nav – Actually year over year sales for portables have seen significant declines (http://www.informationweek.com/news/hardware/handheld/showArticle.jhtml?articleID=224800013) – I would argue much of that is attributable to other devices like the Touch as well as the maturity of the current cycle.

As for app-store impact on Nintendo’s model: data shows the market for portable software is down significantly YoY while another is going up – so you can attribute at least some of the decline to a new alternative (Apps).

bawk

Or that these devices are 5 years old and at the tail end of their lifecycle.

Nav

Hm, good point. I do think, though, that at the moment it’s too early to tell whether this is the ‘Apple Effect’ or the maturity of the cycle.

Still, I do agree that the prevalence of bite-size games available on iOS is starting to change habits. Look at Sony’s so-so stab at it with their ‘Minis’ line. They’ve sold a million titles in 9 months. It’s almost nothing compared to App Store sales, but it means both companies and consumers are clearly responding to something.

What remains to be seen is, when new hardware is launched, whether the bite-size market will cannibalize traditional game sales or exist along side it. After all, when a five year old handheld can sell 500k units in July, there’s clearly still demand for broader, more in-depth gaming experiences. Additionally, even the most jaded in the gaming press were floored by the the 3Ds’ 3D effect – something no-one was expecting.

Deathmore

Have you ever thought that every DS being sold right now is setting a new record.

It shows even after breaking the record it’s still selling. The console has now aged the reason for this decline is possible because the 3DS was announced, people have been put off buying the DS because a 3DS was announced.

Look at the PSP Go, it shows that people still prefer physical media to digital. Everyone knows digital distribution is the future, and that’s what it is the FUTURE. It’s not now! and when the 3DS launches we will still say DD is the FUTURE.

Unlike you (hopefully) and I most consumers do not own a fast line and some do not even have access to broadband. The average internet connection speed for homes in the UK and USA is 2-3Mb (Megabit) this means it takes 8 seconds to download a 2-3MB(Megabyte) file. DS games average at around 64MB and the largest is 512MB, now that’s quite a long download time for a game. Now think about this, the Maximum 3DS cartridge is 2GB at launch, the DS launch with a maximum of 128MB. Now a 3DS launch game could be 1GB, on an average internet connection it will take ages to download a game of 1GB. Until countries further develop a fibre network with a minimum speed of 40Mb to everyone at home, no time soon are full games going completely digital.

Nintendo has an app store, it’s called wiiware and DSiware, offering tibits of games to play. On a fully fledge handheld console, no body wants to play small games all the time so there is variety with the model Nintendo and Sony have.

I think you need to research in the video game generations, It does not justify to spend £99 every year on a brand new MP3 and Mp4 player(iPod nano 4th and 5thgen). It does not justify the purchase of a phone that soley depends on 3rd party software and costs over $400 every single year otherwise you can’t play brand new 15 second games.

The handheld gaming model works because it offers the main games for everyone.

Steve B.

How do you figure this, each life cycle for Nintendo products both hardware and software has increased. The Gameboy over twice as long time span sold over 100 million. The DS has surpassed it in hardware sales in half the amount of time to become all the time selling dedicated gaming system. Since the systems have a low failure rate unlike Apple products (I have a MacBook Pro that I have to replace the AC adapter every year and half), they tend not need to be replace. In Japan they have 70% market saturation. Sales have only decreased over the last couple month since the announcement of the 3DS. Actually the biggest thing that could kill the DS was the R4 and piracy. That has done more to hurt Nintendo then Apple small gaming share could.

Smarter Than You

Still waiting here, buddy. Are you going to rattle off some games that can compare with Kid Icarus?? How about something older like New Super Mario Bros. DS?

You’ve seemed to have gone quiet on this and I don’t blame you. When you’ve wolfed something this bad on something, I’d hide behind my iPad, too.

Steamhare

First of all, you’re being rather unfair, expecting a guy to respond to comments on some article for the rest of his life. Just because he’s stopped commenting, doesn’t mean he’s hiding.

Of course, he’s still WRONG, as any PC gamer will tell you. If he were right about the market for gamers wanting to upgrade to a new model with slight gains every year, the console industry wouldn’t be growing so much as people moved away from PCs, siting regular upgrade costs, and the highest selling games on PCs probably wouldn’t be the ones that can be played on low end machines.
Digital Distribution IS a good, strong, tappable market, however, and Steam’s success shows that it’s working on PCs. But, as so many others have pointed out, Nintendo has a competitive download service, particularly for the handhelds. (I miss Virtual Console releases. DSi all the time…)

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