What’s Next For Nintendo After The DS?

Mr. Toyoda of Nintendo speaks about current achievements, the Nintendo DS, and next generation “Revolution”.

On January 26th 2005, Nintendo announced at their third quarter meeting that sales of the Nintendo DS have surpassed the 2.8 million mark. Amid the attention, sales forecasts for the DS were raised from 5 million to 6 million however expected sales figures for games were lowered from 15 million to 10 million.

What’s the reality of the situation? Mr. Toyoda, PR Chief, was interviewed about the DS, which went on sale last year and the future of Nintendo.

Q: What about the DS?
Mr. Toyoda: Before I explain, please understand that the numbers Nintendo announced don’t include the units that are in shipment or in our sales-subsidiaries warehouses.

Q: The DS’s hardware sales projections were increased from 5 to 6 million. However, the sales projections for games were lowered from 15 to 10 million, right?
Mr. Toyoda: In May of last year, after E3, we established our budget. We were planning for 1 year - until the end of March. The predictions that we established in May were to sell 3.5 million DS units and 15 million games by March of this year.
Those estimates were based upon the traditional hardware and software market. We considered that the Gameboy Advance had a sales ratio of 2.6 games per 1 unit.

If you consider traditional trends, the high praise the DS received at E3, and the ease with which we’ve been moving towards our expectations, one could say that we’ve hit our goal of 3.5 million units and 15 million games.

Q: What is the main reason for Nintendo adjusting their hopes?
Mr. Toyoda: Initially, we wanted to include Pictochat here in Japan. Similarly, we wanted to include Metroid Prime Hunters: First Hunt with the American DS.

Traditionally, the game units preceded games and didn’t come with games included. Back in September, we decided to include Pictochat for Japan and Metroid for America.

Consequently, it’s possible to have fun with just the DS unit and included game. There’s the fear of declining sales figures, but we have high expectations because the DS has a lot of potential that sets it apart from traditional hardware.

Q: Do you think it was possible to adjust figures back in November?
Mr. Toyoda: In November, we examined the projected software sales figures for our second quarter budget. However, our products experience heaviest demand during the Christmas season. Because our orders for units were exceeding expectations, we decided to hope for the best result.

Now, I think it’s important to have clear expectations. The difference between 15 million and 10 million is big, and has caused some worry, but we’re still ahead.

Because the DS can also use Gameboy Advance cartridges, sales of Gameboy Advance titles are better than last year. There are many people who like the format of the traditional games, but also like the style of the DS.

Since we’ve increased our initial hardware sales expectations from 3.5 million to 6.0 million units. Ideally, this will spurn sales of more games, so there’s no need to worry.


Scene from Nintendogs

Lastly, we’ve had to scale back our forecasts for this quarter due to the game Nintendogs getting pushed back to April. The results though, will make themselves apparent next quarter.

Q: What will the future hold for Nintendo?
Mr. Toyoda: Since we’ve started the Club Nintendo service, our data has shown an increase of players over age 19, from 49% to 59%. Also, the data has indicated that the number of women playing games has increased from 15% to 22%.

You don’t have to look very far to see the influence of the Utada Hikaru commercial and by offering people everywhere the opportunity to play with it. This way, even people who couldn’t stand video games are getting into it. Especially when they realize that there’s something for everyone.

Mr. Toyoda: Part of that could come from having to manipulate complicated controls. Now that it’s easy for people to have fun using a simple touch-pen, we can appeal to those types. By making it so easy, we’re able to gain their attention, which will play an increasing role in the future.

As I previously mentioned, games like Nintendogs (available in March) and tools like a dictionary allow people to have a fun experience with just a touch. We’re able to have fun in ways that traditional games can’t even dream of.

We’ve completely overhauled the interface, there are so many ways to connect and have fun. The developers have a lot of energy and really challenged the norms. Long ago, Nintendo started out with that atmosphere.


The Play-yan

Q: Is Play-Yan in response to the PSP?
Mr. Toyoda: Not really. In the past, we’ve stated our desire to have features like what are on Play-Yan. Attaching it to the Gameboy Advance allows people to have more fun. That the Play-Yan also works on the DS is just coincidence.

As far as capabilties go, I think the Gameboy Advance SP is best. Even the way Play-Yan is sold and using an SD card to store data, there needs to be a certain degree of knowledge about the product. I think it’s appropriate to only sell it on the Internet for now because it requires more knowledge beforehand than just going to an existing game shop. As the scale increases though, we’re thinking about our next steps.

Topic: The decreasing number of gamers

Q: Recently, do you think that the user base is becoming limited?
Mr. Toyoda: Last year, we released a Famicom Mini series for the Gameboy Advance. Between Japan and the U.S, 7.21 million units were sold. I think that people who used to play, and who still want to play will buy.

We’ve recognized that ease of use it important. People are saying that games are getting too complicated. They want to have the feeling of ease like long ago. With existing games, if they’re too easy, people say, “That’s it?” It’s important to have a new style of game where everyone, young or old, male or female, experienced or inexperienced, can start from the same place and have fun. With many people wanting to have one, isn’t the DS the solution to that problem?

Q: Nintendo is trying to juggle attending a variety of events this year, right?
Mr. Toyoda: This year we’re not thinking of having our own independent event. We’re thinking about what to do at this year’s E3. The DS is finally available in the Americas and Europe, we want to have enough momentum for the next E3.

Presently, we’re considering announcing our next-generation product, code-named Revolution. Actually, I’m sure there are other companies that are thinking about the exact same thing.

Q: Are you happy with the present circumstances?
Mr. Toyoda: To say that we’re not pleased would be a lie, but we aren’t really worrying about it attention. For Nintendo, we’ve presented the DS as just one solution. However, the basis of our main development methods will not change. Although I think that the way other companies’ developments are headed in different directions.

For now, other companies are wondering what kind of curveball will come from us. We’re not planning to extend the traditional image. We’re thinking about from which direction we should come to properly introduce it. We’re thinking about how to say, “This is fun!”

At any rate, E3 will be the start of the “Revolution”. Will it be an actual machine, an image, or just a concept… I’m not saying, but I think that I’ve said enough, perhaps too much. I’m always thinking about that there are many ways to have fun, not just a score.

Finally, the DS offers fun and surprises for everyone in our target segment, from 5 to 95. I want to say that you’ll enjoy playing it!

Article inspired by:
http://www.itmedia.co.jp/games/articles/0502/02/news084.html