Industrial Gaming 04 | The Nintendo Niche

By Barry Lewis 29.12.2005

The Nintendo Niche
Barry Lewis :: 29th December 2005 :: Issue 4

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Little did he know it but at the start of May Mr. Bill Gates (no he isn't Sir Bill Gates...) was about to craft a buzzword that would shape the gaming community discussions to this very day. It all stemmed from a harmless interview with BusinessWorld.com.

"BW: Sony is the hands-down leader in the current generation of video-game consoles. Can Microsoft surpass Sony in the next generation?

BG: Well, our goal in the last generation was to be in the game. And there were three companies -- Nintendo, Sony, and Microsoft -- who were in this round...

...And so now people are looking really at two companies. I'd say that everyone's watching what Sony will come out with for this next generation, and what will we come out with, and who can be the leader this time around. Both companies will be very big on it. Nintendo is more likely to be a niche player this time around."


Quite strong words from Billy boy really, especially considering Nintendo's ability to turn huge profit and their continued overall market dominance, but more so with the fact that the Revolution was still a well held secret. But in reality what Gates suggested isn't that audacious, especially considering the lack of interest in Nintendo and their handheld division. Times change though, new information comes to light, and people can make mistakes. I plan to take a look back on the statement, a look at why it was made and to then discuss the potential reality of Nintendo becoming a niche player.

So then, why did Mr. Gates surmise that Nintendo would become a niche player in the home console market? If you do a simple scratch-and-sniff with this statement it's a perfectly logical one; Nintendo have been holding home console market share about as well as a sieve holds thick custard. It wasn't doom and gloom at Nintendo HQ, far from it actually, but with each passing generation a small chunk of the once dominant console division vanished. If this continues you could easily conclude that Nintendo had found their niche, mainstream gamers would get their fix elsewhere while Nintendo catered only to the fans of their first party titles.

However we can't take such grandiose statements at sheer face value, to find out the true fairness therein we need to dig deeper, look at the industry, Nintendo and how their public game plan was at the time. Little was known about the future Nintendo console at the start of May but we did know a few details thanks to the Game Developers Conference. Nintendo were planning a "revolution" in gaming, they were planing a "paradigm shift" in control functionality and they were planning to target "non-gamers". These three simple comments (even if some are just amusing cultural translations!) really tell the true story, in fact they're about as subtle as smack in the jaw. When Iwata-san talked of expanding the market he was not planning to target only Nintendo fans, indeed the very game plan of the Revolution was to not be a niche player!


I would love to hear Gates' reaction now that some of the big news has hit from Nintendo, and we know just how revolutionary (or potentially so) the new control environment is. After all J. Allard is trying to convince us all he had the same idea a while back (did anyone buy that?), but much more relevant were the words from Peter Moore. We now have a high level Microsoft employee giving "kudos" to Nintendo and basically saying he thinks the controller will attract non-gamers. And I have to agree with the man, if a potential gamer is scared away by the multiple-button and dual-analogue controller then there's a very good chance they'll become a gamer thanks to the free-hand controller. I'm going to be a little bold and say Bill Gates was wrong, that's not an insult though, I just feel with the popularity that this catch-phrase has received, well someone needed to say it.

"First of all, I want to give kudos for Nintendo, for its attempt at innovation with the new controller - bringing people in that, as Iwata-san said, are either lapsed gamers or gamers that are intimidated by the complexity of the controller." Xbox VP Peter Moore

Of course all of this would mean very little if the Revolution went on to drop yet more market share for Nintendo, in fact I'd be left somewhat with egg on my face! The good news for me however is Nintendo are looking good right now, you might not realise this but they delivered a few tests and we were the unknowing guinea pigs (...scary). The first test was the GameCube, they attempted little in the way of innovation and instead tried fighting Sony on its own turf

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