Nintendo is going into next gen with a lot of momentum... and still several cards to play

As we slowly go into 2024 and a new era for Nintendo with the expected arrival of its next platform, it is the perfect time to sit and think about Nintendo's current position in the gaming landscape.

Exceptional momentum

2023 was supposed to be a pivotal year for Nintendo. It is the year that marked the company's expansion in Movies, with its most iconic brand, and the launch of the much anticipated sequel of Breath of the Wild.

So on the one hand, you had a big unknown despite Mario and Illumination's pedigree. On the other hand, you had one of your master cards, the follow-up to a breakthrough hard to dissociate to the Switch success story itself.

April: From Mister Videogame to Mister Movie?

The Super Mario Movie project was in the works for several years. As you well know, Nintendo's first foray into the movie scene was a failure. It pushed the company to pull the plug on that initiative and encouraged them to keep a tighter leesh on their IPs.

When their partnership with Illumination was announced, it both raised financial hopes and concerns. The studio was famous for both its BO successes (The Minions, Despicable Me...) and its critical shortcomings.

Saying that the anticipation and apprehension was high before the first trailer of the movie would be an understatement. It eventually happened through a dedicated Direct (a great symbol of the synergies between Nintendo's gaming culture and its movie initiatives).

​

I could go on and on about the Movie's roaring success but it is a topic for another day. What's certain is that the movie grossed $1.3B worldwide, and expanded Nintendo/Mario reach beyond what gaming can offer.

It was the first punch, in April, that would put Nintendo's business into an exceptional shape during that quarter and generate ton of momentum.

May: Tears of the Kingdom

Breath of the Wild was a breakthrough for The Legend of Zelda series, far exceeding previous entries. During the 6+ years gap, it continued to sell steadily from less than 3m units in its launch quarter to more than 10 times that amount.

Expectations were high for its direct sequel, Tears of the Kingdom, as fans waited impatiently for years as Nintendo slowly revealed more detail on the latest entry.

(Credits to Peleo, numbers by the end of 2022)​

However, there were some questions too, the novelty factor faded away and the Switch was just entering its 7th year on the market by showing more and more signs of its aging hardware. How important Tears of the Kingdom would really be for Nintendo ?

It didn't take much time for the answer to come, from the launch of a special OLED edition, to the actual launch and Nintendo's official PR only two weeks passed by.

Tears of the Kingdom managed the extremely difficult feat of matching BotW's critical reception, set a record for launch sales for Nintendo during one of the calmest month of the year (most records were set in the Holidays previously) and of boosting hardware more than 6 years after its launch:

Zelda significantly raised the Switch baseline, defying cyclical decline
​

Switch sales rose worldwide during the quarter, to reach a very strong 3.91M units during Mario & Zelda launch quarter, a 12% growth YoY and simply the biggest outside of the Covid boost in 2020/2021. It puts Nintendo into a very comfortable position to reach their 15M forecast for the whole fiscal year since already 26% of the target is reached.

Even if it utlimately slowed down, at least on the hardware front, the momentum is very strong for an ecosystem that old and the reveal (+ now launch) of Super Mario Wonder confirmed that Nintendo would ride this wave throughout the Holiday season. They are therefore ending 2023 in a very favorable position.

So, with 2-3 significant launches in 2023, did Nintendo blow off their load and is going into 2024 empty handed ?

A remake of Paper Mario: The Thousand Year Door was Nintendo's biggest announcement during September 2023's Nintendo Direct
​

We are currently mostly in the dark on the pipeline front. Games are key to have a successful hardware transition, it was abundantely clear for the Switch itself, so what could Nintendo really be preparing for its next console launch window ?

​

2017-2024: Waiting for Mario

It might sound ludicrous, given the amount of Mario related content we got since April 2023, between the movie, a new 2D Mario, a new Peach subseries coming this March, and a meaty slate of remakes. However, there's Mario and Mario, and for Nintendo, two Mario subseries are treated very specially. Those two Mario subseries have been mostly dormant since 2017, at the exception of new (but mainly outsourced) content between 2021 and 2023.

For waiting right ? (excerpt of the final Mario Kart 8 Deluxe Booster Pass credit scene, November 2023)
​

Mario Kart and 3D Mario have been two of the biggest cards of Nintendo's playbook:

• The Mario Kart franchise has hit incredibly massive mainstream appeal ever since its shift to 3D. However, ever since the DS/Wii, the franchise reached new heights, being the best-selling games on every Nintendo platform ever since (3DS, WiiU, Switch).
• For 3D Mario, the return to the sandbox formula combined with the Switch's incredible success has put the subseries to a new level. Trailers of Super Mario Odyssey remain, to this point, the most watched for a Nintendo game (55M for the reveal trailer, 41M for the E3 one in Nintendo of America YT account).

Those two massive assets for Nintendo, among the top 5 of best-selling Switch games with 57m units sold for Mario Kart and 27m for Odyssey (as of September 2023), are however pretty much dormant every since. The studios behind these games have not released a new console game since June 2017 (ARMS from the MK team) and October 2017 (Odyssey, from EPD Tokyo). There have been some work done tho, as mentioned before.

They are two of the cards, on Nintendo's sleeves, to deliver a smooth and exciting transition. For Mario Kart, the anticipation is even grander since 8 initially launched in 2014.

2023 : Pivotal year for big Western IPs ?

Funnily enough, it is partially when the Switch entered its last years (and with PS5/Xbox gaining momentum) that the signs for upcoming and meaningful Western 3rd party support were the clearest.

• The latest FIFA entry, called EA FC 24, has been moved to the Frostbite engine after years of Legacy support (since 2019)
• Hogwarts Legacy, 2023's highest selling game, has been released on Switch despite initially being PS5/XB/PC only, a clear sign of the effort invested in order to make the port happen. Sales of the game on Switch have been extremely strong since its launch.
• As the ABK acquisition closed this year, it is now confirmed that Call of Duty will make its grand return on Nintendo console(s) next year after a decade+ of nothing.

While the reasons behind each of these Switch ports are different, it does position the upcoming platform into a very favorable position. They won't get everything, but they'll get the games that matter the most for mainstream audiences (with GaaS support being also strong). The only remaining member of the holy trifeca, which carried the PS/Xbox since the PS3/X360 era, is Grand Theft Auto. Its presence or absence will have an impact for 2025 sales and beyond.

GTA VI is a big question mark, with a 2025 release date, it is ideally placed to generate momentum for a new console, only a dream ?
​

A few risks

• Risk of delay - while the mometum is very strong for a console that old, the Switch still slowed down significantly this Holiday season despite the release of Super Mario Bros. Wonder. If the successor slips to 2025 (because software isn't ready for instance), then 2024 might be a big struggle.​

• Pricing - The Nintendo Switch released in 2017 at 299$/330€/32.980Y but since then, there has been a big inflation happening and the OLED (which is a bit more expensive) is still the model with the lower margins. An increase is therefore expected, at the risk of cutting a part of Nintendo's audience. The low Yen might also make the jump higher in Japan, which would threathen domestic sales (on which several 1st/3rd party franchises on Switch relied on). The way they'll handle the Switch after its successor launches will be a key aspect to make the smooth transition they are looking for.​

• No new Zelda game for a while - Tears of the Kindgom released in 2023 with a 6 years gap with Breath of the Wild. This is one of Nintendo's biggest assets both comercially and critically, putting the franchise in the league of other huge hardware movers. This also fills a big hole in Nintendo's library, with very few open world games coming from 3rd party publishers (those don't usually scale down well on lower powered devices). So when will the new open air Zelda release ? Probably not before 2028, and that's with Aonuma confirming that no DLC will release for Tears.​

To conclude, it does seem like Nintendo is potentially in a very good position to launch a new platform in 2024. 2023 is ending on a high note for the firm, which closed the year at the highest market cap of its whole history. Confidence is high but I'd like to take this occasions to ask you, in your opinion, how Nintendo could ensure the best transition possible, and how could it solve the risks I mentioned and/or the ones you have in mind ?

2024 will be a very exciting year for that very reason, speculating and ultimately knowing Nintendo's grand plan for a very important "smooth transition".

 

[ILikeFeet]

3D mario is absolutely a platform driver. hell, I'd go so far to say the next 3D mario was developed alongside NVN2 itself

 

[Mekanos]

3D mario is absolutely a platform driver. hell, I'd go so far to say the next 3D mario was developed alongside NVN2 itself

Sorry, what's NVN2?

 

[Golden Darkness]

Sorry, what's NVN2?

That would be the API that is rumored to be used to program games on the new hardware, like how DirectX 12 or Vulkan is for PCs. The API the current Switch uses is called NVN. Its existence was leaked years ago and while not officially confirmed, it is likely to be what will be used to program games for the successor.

 

[Danny]

One idea i had, should Nintendo have Cygames make a Dragalia lost Switch 2 game? That game seems pretty popular and Cygames proved with Granblue Fantasy Relink that they can be a solid console game maker as well.

 

[AruanaRiva]

One idea i had, should Nintendo have Cygames make a Dragalia lost Switch 2 game? That game seems pretty popular and Cygames proved with Granblue Fantasy Relink that they can be a solid console game maker as well.

While i would love to death if this ever happen. I don't think Cygames and Nintendo had any good close relation anymore after the fall out of Dragalia there.

 

[duvjones]

One idea i had, should Nintendo have Cygames make a Dragalia lost Switch 2 game? That game seems pretty popular and Cygames proved with Granblue Fantasy Relink that they can be a solid console game maker as well.

Weren't they still building off of the Platinum Games code while they were involved in that project?

 

[Astrogamer]

Weren't they still building off of the Platinum Games code while they were involved in that project?

Seems more like they hired ex Capcom and Platinum staff after they removed Platinum from the project.

 

[ILikeFeet]

Weren't they still building off of the Platinum Games code while they were involved in that project?

we don't know. they had their own engine which they could have used after pulling from Platinum

 

[duvjones]

Seems more like they hired ex Capcom and Platinum staff after they removed Platinum from the project.

That makes sense, especially if they are familiar with the coding style of the company.

we don't know. they had their own engine which they could have used after pulling from Platinum

Honestly, unless that was build in tandem with what PG was doing at the same time, which I doubt because that is COSTLY, I doubt that they are working off of their own code completely.

 

[ILikeFeet]

Honestly, unless that was build in tandem with what PG was doing at the same time, which I doubt because that is COSTLY, I doubt that they are working off of their own code completely.

they'd still have to pay Platinum if they're using their engine. though if they did use their tools, it's probably a one-time thing.

has there been any datamining of Granblue? that would give us a more definitive answer

EDIT: found an answer, it's CyGame's engine

 

[randomengine]

We have been hearing for years that all Nintendo has to do is sell a more powerful Switch and they will be successful. While I think that conventional wisdom is partially true, if all Nintendo does is provide a Switch Pro, they will not only miss an opportunity to increase software sales, they will in the longer run shorten the lifecycle of Switch 2.

PS5 Pro developer verdict: ‘I didn’t meet a single person that understood the point of it’

This article has been making the rounds recently and it has me thinking. If a PS5 Pro is more or less dead in the water (because it won't drive much software sales), then Switch 2 will struggle similarly. Not totally, but similarly. What Switch 2 has going for it is that Switch 1 was so much less powerful, meaning that Switch 2 can have more games on it that it didn't have before.

You see, the main sales driver for Switch software is this basic hook - play your console games portably. That's why a lot of people have decided to make Switch their home for many types of games and we know platform stickiness is really potent.

So if Nintendo sells a Switch 2 as a Switch Pro (just more powerful with no other gimmick), then Switch 1 holders have no reason to buy more (and older) Switch games...unless there is a concerted effort to pull performance of old games forward.

So what are the factors that will drive more software sales

1. Buy this Switch 2 game that couldn't be on Switch 1
2. Buy old Switch 1 games because now they look better and perform better on Switch 2

That's not enough. While it may drive Switch 2 sales, and Switch 2 software sales, what is really important is the back library.

What Nintendo needs is the following:

• A Switch 2 feature that will make users want to go back and replay their old games or buy old Switch games on the new hardware.

If Switch 2 has such a feature, it will help drive software sales. Playing all your games portably was the lynchpin of Switch 1 success. However strong that additional feature is will determine the success of the new system more so than just the additional power upgrade.

 

[ILikeFeet]

you're point hinges on the Switch 2 being a Switch Pro, which, by the very name, it isn't

PS5 Pro is an enthusiast device for people who want more performance from PS5 games. that's inherently niche as we've seen from teh PS4 Pro. people are just fine with the PS4 as it still got games all the same (it was the default system after all). so getting games in the future is absolutely a system seller. once you stop getting games, you're done. Switch is on a timer as dev processes will naturally phase out such low end hardware

 

[Joseki]

So if Nintendo sells a Switch 2 as a Switch Pro (just more powerful with no other gimmick), then Switch 1 holders have no reason to buy more (and older) Switch games...unless there is a concerted effort to pull performance of old games forward.

Why would Nintendo sell a console with multiple AAA exclusive games as a revision?

They didn't sell GBA as a GB revision.

 

[randomengine]

Why would Nintendo sell a console with multiple AAA exclusive games as a revision?

They didn't sell GBA as a GB revision.

My argument is that a more powerful Switch 2 with no other feature is just a Switch Pro

Post automatically merged: Mar 27, 2024

you're point hinges on the Switch 2 being a Switch Pro, which, by the very name, it isn't

PS5 Pro is an enthusiast device for people who want more performance from PS5 games. that's inherently niche as we've seen from teh PS4 Pro. people are just fine with the PS4 as it still got games all the same (it was the default system after all). so getting games in the future is absolutely a system seller. once you stop getting games, you're done. Switch is on a timer as dev processes will naturally phase out such low end hardware

The PS5 is essentially a PS4 pro pro more so than a switch 2 would be a Switch pro by the very virtue of switch 2 having more exclusive games.

This shows up in PS5s struggling performance especially in software.

 

[ILikeFeet]

The PS5 is essentially a PS4 pro pro more so than a switch 2 would be a Switch pro by the very virtue of switch 2 having more exclusive games.

This shows up in PS5s struggling performance especially in software.

then the comparison is even more flawed because the PS4 is just a PS3 Pro in that sense. not to mention, as you said, it's showing the PS5 is struggling, which has a different selling point than Switch/Switch 2

 

[randomengine]

then the comparison is even more flawed because the PS4 is just a PS3 Pro in that sense. not to mention, as you said, it's showing the PS5 is struggling, which has a different selling point than Switch/Switch 2

Actually no, because the leap in fidelity and capability from PS3->PS4 was justifiable.

Even more so comparing the ps3 to the ps4 pro. But comparing the ps4 pro to ps5 there hasn’t been a lot of change other than solid state

 

[awng782]

We have been hearing for years that all Nintendo has to do is sell a more powerful Switch and they will be successful. While I think that conventional wisdom is partially true, if all Nintendo does is provide a Switch Pro, they will not only miss an opportunity to increase software sales, they will in the longer run shorten the lifecycle of Switch 2.

PS5 Pro developer verdict: ‘I didn’t meet a single person that understood the point of it’

This article has been making the rounds recently and it has me thinking. If a PS5 Pro is more or less dead in the water (because it won't drive much software sales), then Switch 2 will struggle similarly. Not totally, but similarly. What Switch 2 has going for it is that Switch 1 was so much less powerful, meaning that Switch 2 can have more games on it that it didn't have before.

You see, the main sales driver for Switch software is this basic hook - play your console games portably. That's why a lot of people have decided to make Switch their home for many types of games and we know platform stickiness is really potent.

So if Nintendo sells a Switch 2 as a Switch Pro (just more powerful with no other gimmick), then Switch 1 holders have no reason to buy more (and older) Switch games...unless there is a concerted effort to pull performance of old games forward.

So what are the factors that will drive more software sales

1. Buy this Switch 2 game that couldn't be on Switch 1
2. Buy old Switch 1 games because now they look better and perform better on Switch 2

That's not enough. While it may drive Switch 2 sales, and Switch 2 software sales, what is really important is the back library.

What Nintendo needs is the following:

• A Switch 2 feature that will make users want to go back and replay their old games or buy old Switch games on the new hardware.

If Switch 2 has such a feature, it will help drive software sales. Playing all your games portably was the lynchpin of Switch 1 success. However strong that additional feature is will determine the success of the new system more so than just the additional power upgrade.

PS5 Pro is just an enhanced PS5 model while Switch 2 will be a full next-generation platform, these aren't comparable at all.

 

[storres]

PS5 Pro will not have exclusive games, Switch 2 will.

 

[Decoyman]

Big Shakeup At Nintendo Testing Center Ahead Of Switch 2

Nintendo of America lays off some contractors while converting others to full-time employees

kotaku.com

Kotaku posted a report about Nintendo of America restructuring their testing department. Many contractors will not be getting renewed contracts, which would be the first larger-scale layoff at a Nintendo branch since the recent wave of industry layoffs have begun, though Nintendo aren't positioning this move as a cost-cutting measure; other contractors have been promoted into full-time positions, and many of those are supposedly being moved out of software testing. According to Kotaku's sources, the testing pipeline at NoA has dried up for now due to a "lull" in big first party releases, and none of the people they've spoken to have any awareness of employees that have had hands-on testing with Switch 2 as of yet.

Some assumptions can probably be made on what this means for Nintendo's remaining 2024 slate and the near future beyond, though I'd hazard a guess that Switch 2 testing for now is probably being done exclusively by upper-end employees or even done predominantly in Japan; after this restructure it is probably going to ramp up globally. Any speculation one can infer about the software slate based on this news would probably have Metroid Prime 4 exempt from it, since Retro Studios have regularly hired their own product testers.

 

[Joseki]

My argument is that a more powerful Switch 2 with no other feature is just a Switch Pro

Yeah and PS5 is also a PS Pro Pro Pro Pro then.

 

[duvjones]

PS5 Pro will not have exclusive games, Switch 2 will.

I don't think that it the point, I think that the argument that @randomengine is trying to make, one that I have pondered personally, is to ask if in the current market does making a new Switch platform that is the old platform with more performance going to be enough for the market to take notice outside of niches.

We can all sit around and say that it would but I honestly don't see it without Nintendo doing something to make the platform marketable. They want that casual money, and mobile isn't going to provide a space for that as it grows older. I wonder what they do but just juicing the performance will likely not do much and to add to the complication, the old platform continues to exist... the Switch has yet to see rock bottom, and it's slowing down slower than expected.
I don't see a panic to a new platform at this point.

 

[storres]

I don't think that it the point, I think that the argument that @randomengine is trying to make, one that I have pondered personally, is to ask if in the current market does making a new Switch platform that is the old platform with more performance going to be enough for the market to take notice outside of niches.

We can all sit around and say that it would but I honestly don't see it without Nintendo doing something to make the platform marketable. They want that casual money, and mobile isn't going to provide a space for that as it grows older. I wonder what they do but just juicing the performance will likely not do much and to add to the complication, the old platform continues to exist... the Switch has yet to see rock bottom, and it's slowing down slower than expected.
I don't see a panic to a new platform at this point.

Yes, I know the point he tried to make is that Switch 2 should be something else rather than Switch 2.0, but it has always been about the games.

 

[brutaka3]

Big Shakeup At Nintendo Testing Center Ahead Of Switch 2

Nintendo of America lays off some contractors while converting others to full-time employees

kotaku.com

Kotaku posted a report about Nintendo of America restructuring their testing department. Many contractors will not be getting renewed contracts, which would be the first larger-scale layoff at a Nintendo branch since the recent wave of industry layoffs have begun, though Nintendo aren't positioning this move as a cost-cutting measure; other contractors have been promoted into full-time positions, and many of those are supposedly being moved out of software testing. According to Kotaku's sources, the testing pipeline at NoA has dried up for now due to a "lull" in big first party releases, and none of the people they've spoken to have any awareness of employees that have had hands-on testing with Switch 2 as of yet.

Some assumptions can probably be made on what this means for Nintendo's remaining 2024 slate and the near future beyond, though I'd hazard a guess that Switch 2 testing for now is probably being done exclusively by upper-end employees or even done predominantly in Japan; after this restructure it is probably going to ramp up globally. Any speculation one can infer about the software slate based on this news would probably have Metroid Prime 4 exempt from it, since Retro Studios have regularly hired their own product testers.

One ex-contractor on Famiboards said that this basically is a non story. I'm almost sure (they didn't said this, I'm adding it), the article added Switch 2 to the tile to get more clicks.

Basically said that their contracts are on project to project basis, after every project many contractors leave and the actual news is that this time instead of just letting all go, they are making permanent contracts for many of them.

Also contractors don't know anything about future projects until the moment they start testing, so their comments of not having knowledge of future projects i just the usual.

 

[Koni]

One ex-contractor on Famiboards said that this basically is a non story. I'm almost sure (they didn't said this, I'm adding it), the article added Switch 2 to the tile to get more clicks.

Basically said that their contracts are on project to project basis, after every project many contractors leave and the actual news is that this time instead of just letting all go, they are making permanent contracts for many of them.

Also contractors know anything about future projects until the moment they start testing, so their comments of not having knowledge of future projects i just the usual.

Do link? Cause that read makes more sense to me.

 

[brutaka3]

Do link? Cause that read makes more sense to me.

Nintendo of America restructuring testing center, could impact over 100 contractors

https://nintendoeverything.com/nintendo-of-america-restructuring-testing-center-could-impact-over-100-contractors/ https://kotaku.com/nintendo-switch-2-layoffs-testing-zelda-totk-1851369539

famiboards.com

 

[Wockio]

This shows up in PS5s struggling performance especially in software.

This is only a thing in Japan, elsewhere software sales are stronger than ever

 

[duvjones]

Basically said that their contracts are on project to project basis, after every project many contractors leave and the actual news is that this time instead of just letting all go, they are making permanent contracts for many of them.

Believe it or not, this is not uncommon. Other business that rely on employment agencies or contract workers do this all the time. It's a pool of employees that are familiar with your process and product, even if it's temporary... as so long as one hits their milestones, that is a worker that you want to attract to your business than walk away with the knowledge.

What sucks about it is that until that hiring process, you are temporary. It's entirely up to the employer to renew a contract for another project or not, and if they got nothing on the go, they got nothing on the go and you are let go. It sucks but it's one of those things that should be understood as one enters the contract.

 

[brutaka3]

Believe it or not, this is not uncommon. Other business that rely on employment agencies or contract workers do this all the time. It's a pool of employees that are familiar with your process and product, even if it's temporary... as so long as one hits their milestones, that is a worker that you want to attract to your business than walk away with the knowledge.

What sucks about it is that until that hiring process, you are temporary. It's entirely up to the employer to renew a contract for another project or not, and if they got nothing on the go, they got nothing on the go and you are let go. It sucks but it's one of those things that should be understood as one enters the contract.

Yeah, there's also contractors where I work. Was mostly explaining because this is not like the other layoffs in the industry. Yes, not ideal that some people won't be getting renewed, but this is something usual. The issue is how some sites are framing this (VGC's headline for this is "Nintendo of America is reportedly cutting 120 contractor roles ahead of Switch 2’s launch", which technically isn't incorrect, but clearly gives the idea of 120 jobs being lost, when that's not true).

 

[WildCard]

You see, the main sales driver for Switch software is this basic hook - play your console games portably.

That's not exactly right: it's the hybrid factor which does let the end user decide using the system either as a home console or a portable console (even alternating between both modes), whenever and seamlessly.

This is true within the Japanese market as well, and the Playstation's demise over there is tied to several other factors (pricepoint of the console, subscription fees, no longer the de-facto place for Japanese third-parties, no first-party content, stock issues during the first half of its lifespan, O/X button swap).

 

[duvjones]

VGC's headline for this is "Nintendo of America is reportedly cutting 120 contractor roles ahead of Switch 2’s launch", which technically isn't incorrect, but clearly gives the idea of 120 jobs being lost, when that's not true

Yeah, I saw that and honestly this is one of those few times words matter over something like this. I guess they went with that kind of working because it something that readers are familiar with but a "layoff" isn't exactly what this is and they should be clear about that in the headline.
Other sites are likely going to frame this similarly because the losses suck, but we are talking about folks that were employees of the agency/business that was assigned the contract not NOA itself.

 

[ILikeFeet]

Actually no, because the leap in fidelity and capability from PS3->PS4 was justifiable.

Even more so comparing the ps3 to the ps4 pro. But comparing the ps4 pro to ps5 there hasn’t been a lot of change other than solid state

and the jump between Switch and Switch 2 isn't justifiable? especially when we don't know the actual size of the jump?

 

[Danny]

Nintendo wants to go the opposite way of Sony, instead of moving their headquarters to the US like Sony did with Playstation Nintendo wants as few workers as possible in the US because of higher salaries there compared to Japan.

 

[MegaXZero]

Nintendo wants to go the opposite way of Sony, instead of moving their headquarters to the US like Sony did with Playstation Nintendo wants as few workers as possible in the US because of higher salaries there compared to Japan.

That’s not at all what’s happening, especially since they hired a good portion of them which will cost more in the long run.

 

[Joseki]

Nintendo wants to go the opposite way of Sony, instead of moving their headquarters to the US like Sony did with Playstation Nintendo wants as few workers as possible in the US because of higher salaries there compared to Japan.

Nintendo did this already in the early 00s.

Nintendo of America and Nintendo of Europe are glorified localization/marketing subsidiaries.

 

[duvjones]

Nintendo did this already in the early 00s.

I can't speak for Europe but NOA was always structured like that since the beginning. Nintendo Co Ltd. always kept a rather close relationship between itself and NOA as a means of over-site, particularly among the c-suite. NOA doesn't really do anything without Nintendo Co Ltd. knowing about it.

 

[Danny]

We have been hearing for years that all Nintendo has to do is sell a more powerful Switch and they will be successful. While I think that conventional wisdom is partially true, if all Nintendo does is provide a Switch Pro, they will not only miss an opportunity to increase software sales, they will in the longer run shorten the lifecycle of Switch 2.

PS5 Pro developer verdict: ‘I didn’t meet a single person that understood the point of it’

This article has been making the rounds recently and it has me thinking. If a PS5 Pro is more or less dead in the water (because it won't drive much software sales), then Switch 2 will struggle similarly. Not totally, but similarly. What Switch 2 has going for it is that Switch 1 was so much less powerful, meaning that Switch 2 can have more games on it that it didn't have before.

You see, the main sales driver for Switch software is this basic hook - play your console games portably. That's why a lot of people have decided to make Switch their home for many types of games and we know platform stickiness is really potent.

So if Nintendo sells a Switch 2 as a Switch Pro (just more powerful with no other gimmick), then Switch 1 holders have no reason to buy more (and older) Switch games...unless there is a concerted effort to pull performance of old games forward.

So what are the factors that will drive more software sales

1. Buy this Switch 2 game that couldn't be on Switch 1
2. Buy old Switch 1 games because now they look better and perform better on Switch 2

That's not enough. While it may drive Switch 2 sales, and Switch 2 software sales, what is really important is the back library.

What Nintendo needs is the following:

• A Switch 2 feature that will make users want to go back and replay their old games or buy old Switch games on the new hardware.

If Switch 2 has such a feature, it will help drive software sales. Playing all your games portably was the lynchpin of Switch 1 success. However strong that additional feature is will determine the success of the new system more so than just the additional power upgrade.

You can't really compare Switch 2 with a PS5 pro, the PS5 pro will have exactly the same games as the base PS5. The Switch 2 will not only have new, exclusive Nintendo games that won't be released on Switch 1 but it will also have many third party games that won't release on Switch 1. Backwards compability and playing Switch 1 games with better frame rates and resolution is a possible feature of the Switch 2 as well but that is more a bonus feature, the real hook is that Switch 2 will have new Nintendo games and ports of third party titles that never released on Switch 1.

While the PS5 pro only has better resolution/frame rates as the hook, the gaming lineup will be 100 % the same as the base PS5 model, which naturally caps the pro model sales to only the most hardcore crowd of PS users.

 

[Terrell]

We have been hearing for years that all Nintendo has to do is sell a more powerful Switch and they will be successful. While I think that conventional wisdom is partially true, if all Nintendo does is provide a Switch Pro, they will not only miss an opportunity to increase software sales, they will in the longer run shorten the lifecycle of Switch 2.

PS5 Pro developer verdict: ‘I didn’t meet a single person that understood the point of it’

This article has been making the rounds recently and it has me thinking. If a PS5 Pro is more or less dead in the water (because it won't drive much software sales), then Switch 2 will struggle similarly. Not totally, but similarly. What Switch 2 has going for it is that Switch 1 was so much less powerful, meaning that Switch 2 can have more games on it that it didn't have before.

You see, the main sales driver for Switch software is this basic hook - play your console games portably. That's why a lot of people have decided to make Switch their home for many types of games and we know platform stickiness is really potent.

So if Nintendo sells a Switch 2 as a Switch Pro (just more powerful with no other gimmick), then Switch 1 holders have no reason to buy more (and older) Switch games...unless there is a concerted effort to pull performance of old games forward.

So what are the factors that will drive more software sales

1. Buy this Switch 2 game that couldn't be on Switch 1
2. Buy old Switch 1 games because now they look better and perform better on Switch 2

That's not enough. While it may drive Switch 2 sales, and Switch 2 software sales, what is really important is the back library.

What Nintendo needs is the following:

• A Switch 2 feature that will make users want to go back and replay their old games or buy old Switch games on the new hardware.

If Switch 2 has such a feature, it will help drive software sales. Playing all your games portably was the lynchpin of Switch 1 success. However strong that additional feature is will determine the success of the new system more so than just the additional power upgrade.

Aside from pointing out the other failures of the argument being made as others have, it feels necessary to point out this argument also erases the fact that the market for a better Switch has already been well established to be there.

Nintendo legit released a Switch with a better screen and a few minor tweaks and it has easily supplanted the other models in sales in every market region. A better screen was really all it took to make that happen, so why would anyone be of the position that the market will not respond to a more powerful Switch when OLED makes the case that they will?

 

[Danny]

I don't think that it the point, I think that the argument that @randomengine is trying to make, one that I have pondered personally, is to ask if in the current market does making a new Switch platform that is the old platform with more performance going to be enough for the market to take notice outside of niches.

We can all sit around and say that it would but I honestly don't see it without Nintendo doing something to make the platform marketable. They want that casual money, and mobile isn't going to provide a space for that as it grows older. I wonder what they do but just juicing the performance will likely not do much and to add to the complication, the old platform continues to exist... the Switch has yet to see rock bottom, and it's slowing down slower than expected.
I don't see a panic to a new platform at this point.

Nintendo lives and dies by first party content, as soon as Switch 2 is released and have new games like a new 3D Mario and others Switch 1 sales will collapse and Switch 2 sales will take over totally. And the new third party games that will get Switch 2 ports that was never released on Switch 1 will be an added bonus for the platform.

I also think Nintendo will have fewer cross gen releases and for a shorter period of time than Sony had with PS5, meaning if people want to continue to play new Nintendo games they will have to upgrade to Switch 2.

Of course its likely that Switch 2 will in total sell less units than Switch 1 did, but it should be able to achieve a healthy user base in the long run.

I can't speak for Europe but NOA was always structured like that since the beginning. Nintendo Co Ltd. always kept a rather close relationship between itself and NOA as a means of over-site, particularly among the c-suite. NOA doesn't really do anything without Nintendo Co Ltd. knowing about it.

Off topic but it seems that Nintendo no longer wants NOA to be the face of Nintendo in the west, Reggie was so much the face of Nintendo in the US you could think he was the president of Nintendo during his time at NOA, that has changed massively since he left.

 

[Djehuty]

Actually no, because the leap in fidelity and capability from PS3->PS4 was justifiable.

the switch > switch 2 leap is justifiable

 

[Danny]

the switch > switch 2 leap is justifiable

Yeah in many ways the Switch is similar to the Wii U in specs, a console released in 2012. So if any console leap is justifiable it would be for Nintendo that have had similar specs for their games since 2012 by now.

 

[StardustTraveler]

The Switch's Tegra X1 was first used in a tablet in 2015. It's safe to say there would be a generational leap in horsepower for the successor.

 

[Terrell]

Off topic but it seems that Nintendo no longer wants NOA to be the face of Nintendo in the west, Reggie was so much the face of Nintendo in the US you could think he was the president of Nintendo during his time at NOA, that has changed massively since he left.

The lasting legacy of Howard Lincoln. Considering how it took them an entire hardware cycle to clean up his mess after he was out at NoA, Iwata made the call to not give the American and European subsidiaries the kind of power he was permitted to wield under Yamauchi. As time has gone on, the collective actions of Iwata, Kimishima and now Furukawa have made such an arrangement likely unnecessary, as the Kyoto offices seem more than capable of doing business internationally without regional players in ways that people used to argue they were ill-equipped to (see examples: movie production, theme park attractions, stronger international developer relations that have led to an acquisition).

 

[StardustTraveler]

The lasting legacy of Howard Lincoln. Considering how it took them an entire hardware cycle to clean up his mess after he was out at NoA, Iwata made the call to not give the American and European subsidiaries the kind of power he was permitted to wield under Yamauchi. As time has gone on, the collective actions of Iwata, Kimishima and now Furukawa have made such an arrangement likely unnecessary, as the Kyoto offices seem more than capable of doing business internationally without regional players in ways that people used to argue they were ill-equipped to (see examples: movie production, theme park attractions, stronger international developer relations that have led to an acquisition).

Can you expand on your first point? How did Howard Lincoln mismanage Nintendo of America, in your view? I know the N64 and Gamecube performed poorly compared to PlayStation, but that was also true in Japan, not just the American market. So it's not obvious to me that NoA in particular was doing badly.

 

[AruanaRiva]

That’s not at all what’s happening, especially since they hired a good portion of them which will cost more in the long run.

While this is true. nintendo does cut some of its contract employees there to pick the best crop there and make them into their long term employees.

Overall, i think this is just nintendo being more picky on getting more employees into their fold.

 

[Djehuty]

so you are basing your judgment on the company on rumors, but only the one that support your "big-trouble" point of view?

because following rumors, Nintendo should have ready/working on for Switch 1

- Fire Emblem 4 remake (million seller)
- Metroid Prime 2HD - Metroid Prime 3HD (sub million sellers, imho)
- Pokemon B/W remake (5+ million seller)

on top of

- Metroid Prime 4 (officially announced as a Switch game - 3 million seller like Dread, I suppose?)
- Pokemon Legends Z-A (officially announced as a Switch game for 2025 - 10+ million seller based on 15mil Arceus, I suppose?)

all of these after 3 possible million sellers in H1 2024

- Mario vs DK (1mil?)
- Paper Mario (2mil? Origami King at 3.47mil, Mario RPG at 3.12mil)
- Luigi 2 HD (2mil? Luigi 3 is at 14mil!)

all of this after Nintendo officially releasing these 3 already-confirmed games in H1 2024 AFTER the rumors of the supposed Switch 2 delay spreading online

so the question is

- why the Switch 2 (a never announced nor confirmed nor cited by Nintendo console) delay rumors are more reliable than the software ones?
- why shouldn't we consider also the 3 additional (multi) million seller rumored games being ready for a 2024 release?
- why shouldn't we consider the 2 multimillion already announced sellers game?
why would Nintendo plan a game per month in the H1 2024, with a game officially slated for 2025, leaving the H2 2024 completely barren and empty if they don't have anything else to be released?

What is with those number predictions ?

They’re so pessimistic, fe4 will hit 2mil at least, and Pokémon remakes are not gonna being selling 5mil l

 

[Terrell]

Can you expand on your first point? How did Howard Lincoln mismanage Nintendo of America, in your view? I know the N64 and Gamecube performed poorly compared to PlayStation, but that was also true in Japan, not just the American market. So it's not obvious to me that NoA in particular was doing badly.

Not sure you asked for a full-blown syllabus on the subject, but... prepare for an education.

Howard Lincoln was terrible (or, Why Nintendo's golden years weren't so golden)

So... I said something that touched a nerve in another thread that I was requested to follow up on. I wish I hadn't, this went into WAY more detail than I intended. But it's a thing now, so... here we go. Howard Lincoln, former Senior VP (1983-1994) and Chairman of Nintendo of America...

famiboards.com

Yeah, I got so fed up with the uncritical praise of "the Lincoln/Yamauchi era" of Nintendo that I wrote an essay back in 2021 to read the man for filth so I didn't have to repeat myself anymore. LOL

 

[BTB123]

I don't think that it the point, I think that the argument that @randomengine is trying to make, one that I have pondered personally, is to ask if in the current market does making a new Switch platform that is the old platform with more performance going to be enough for the market to take notice outside of niches.

We can all sit around and say that it would but I honestly don't see it without Nintendo doing something to make the platform marketable. They want that casual money, and mobile isn't going to provide a space for that as it grows older. I wonder what they do but just juicing the performance will likely not do much and to add to the complication, the old platform continues to exist... the Switch has yet to see rock bottom, and it's slowing down slower than expected.
I don't see a panic to a new platform at this point.

It's not like it's literally just going to be a Switch with more performance. It's going to look a lot different and have many features improved and added beyond higher processing power. Marketing will be sure to showcase it as a completely new product and the exclusive games will be the main selling point anyways.

 

[Aostia82]

It's not like it's literally just going to be a Switch with more performance. It's going to look a lot different and have many features improved and added beyond higher processing power. Marketing will be sure to showcase it as a completely new product and the exclusive games will be the main selling point anyways.

unless it's called Switch U, you know?

Btw I partially agree with some of the doubts about it being "just" a Switch 2: I'm convinced that the Switch hybrid concept has been a game changer: it's direct sequel can totally be succesfull but won't be as strong at the first iteration has been imho

 

[Danny]

unless it's called Switch U, you know?

Btw I partially agree with some of the doubts about it being "just" a Switch 2: I'm convinced that the Switch hybrid concept has been a game changer: it's direct sequel can totally be succesfull but won't be as strong at the first iteration has been imho

I think Nintendo's goal is probably to become more like Playstation. Playstation are in a position where they know that every new Playstation iteration will sell well, some will sell a bit less (PS3) and some will sell a bit more (PS2), but they are all expected to sell pretty similar. Nintendo on the other hand usually have massive differences in sales numbers from different console generations. The goal of iterating on Switch is probably to make it easier to sell more similar between new console generations. Lets say that the Switch 2 sells between 80-100 million units in total, a strong decline from Switch but still enough sales to have a healthy user base for new Nintendo games. And a far cry from the decline Wii U saw compared to the Wii (A roughly 90 % decline) from one generation to the next.

And maybe during the Switch 2 generation Nintendo releases stuff like Switch 2 Pro to make the Nintendo hardcore gamers double dip buying hardware like Sony does with Playstation pro nowadays.

 

[Aostia82]

I think Nintendo's goal is probably to become more like Playstation. Playstation are in a position where they know that every new Playstation iteration will sell well, some will sell a bit less (PS3) and some will sell a bit more (PS2), but they are all expected to sell pretty similar. Nintendo on the other hand usually have massive differences in sales numbers from different console generations. The goal of iterating on Switch is probably to make it easier to sell more similar between new console generations. Lets say that the Switch 2 sells between 80-100 million units in total, a strong decline from Switch but still enough sales to have a healthy user base for new Nintendo games. And a far cry of the decline Wii U saw compared to the Wii (A roughly 90 % decline) from one generation to the next.

And maybe during the Switch 2 generation Nintendo releases stuff like Switch 2 Pro to make the Nintendo hardcore gamers double dip buying hardware like Sony does with Playstation pro nowadays.

It could be
surely one "negative" (for me, not necessarily in terms of business for them LOL) side of the hybrid concept is that they probably are going to experiment less with hardware

but of course until they will stay a "monopoly" (actual or de-facto) in the dedicated hybrid segment, with all their strong IP (development pipeline) focused only on that form factor/hardware specs/product generation they should be safer, in terms of average hardware numbers sold in each generation