Video Games

Nintendo’s 3rd party troubles are the fault of Nintendo

Nintendo has been pioneering video games since 1983 (Japan)/1985(U.S.), and has revolutionized video games as we knew it in 1983. Atari at the time was the undisputed king of video games at the time. Nintendo’s latest console, the Wii U has sold poorly in the last 3 years. It should be a surprise to a lot of speculators, because Wii sold 100+ million units worldwide. Nintendo has positioned Wii U to be a hardcore gaming console, but sold only 7 million units so far. Xbox One is currently at 5 million units, and PlayStation 4 is in the lead with 10 million units sold.

One would think that Wii U would have been successful since it has sold over 100 million units. It’s a pattern that Nintendo can’t seem to shake off. Nintendo’s original game console, the Nintendo Entertainment System (NES) sold 61+ million units worldwide. The second game console, the Super NES sold 49+ million units worldwide. That’s a 20% drop. The third console, Nintendo 64 sold only a measly 32+ million units worldwide. That’s a 10% drop. The fourth console, the GameCube sold 22 million units worldwide, a 5% drop. See the pattern?

The Wii is the best selling game console in Nintendo’s 20 year history.

Why is this a pattern? What’s the cause of it?
During NES’s lifespan, you would find hundreds, if not thousands of video games on store shelves. Equivalent of the 2,000 games in the PlayStation 2 library throughout it’s lifespan. That number dropped during Super Nintendo, for a number of reasons. So, let’s start from the beginning.

Nintendo’s Official Seal of Quality logo

Seal of Quality

As miniscule as it looks, it was a big problem in the industry. You see, Nintendo thought they were solving a problem with their “Official Seal of Quality” icon. Before this initiative, Atari was getting hit with a bunch of unlicensed games flooding, pouring the video game industry. Sweeping the market. Nintendo was hit with the same curse for the first few years. Nintendo went up against a few publishers and slapped their wrist with million dollar lawsuits.

Once Nintendo was finished with all that, they continued or finished their protocol for these “stamp of approval.” The Seal of Quality system is actually a licensing play. If you published a Nintendo game without Nintendo’s explicit approval, you’re in court a few months later. That’s one part.

Cartridges are very, rather expensive. Nintendo implemented a protocol for that; a game developer/publisher is only limited to the amount of cartridges ordered and shipped to retailers. That means, companies like Atlus (Friday the 13th), MiltonBradley (Marbles Madness), Brøderbund (The Guardian Legend), Irem (R-Type), SunSoft (Blaster Master), and others could only allocate a quota of how many cartridges was manufactured and sold.

In the beginning it was a “comfortable” thing for a lot of developers/publishers from 1983 to 1994, but many of those developers got tired of Nintendo’s rigid licensing fees, manufacturing fees, and ultimately, put a limitation not only to creative freedom, but how many copies of a game can be manufactured and sold. It begs the question for me: How did Activision, Capcom, Electronic Arts, and other major, big name companies survive through these years? I’ll leave that for another day.

So, during Nintendo 64’s lifespan, developers left in droves – which resulted in software droughts between seasons. Sometimes the droughts were between the beginning of Winter, to Summer, and sometimes from Summer to Fall. Just not a good value proposition for customers, consumers, and ultimately, developers. When you have a lot of games on the shelves, it gives the impression that the market is big enough to sustain a healthy gaming community.

PlayStation stole a lot of the developers away from Nintendo because it offered a cheaper alternative to Nintendo’s cartridges. Licensing fees, and manufacturing of discs were so cheap then, that Sony was enjoying runaway success.

The Seal of Quality stamp of approval was detrimental to both Nintendo and developers alike. God only knows how many potential developers fell through the cracks starting from NES, to N64. The NES stands as Nintendo’s highlight console because every single developer wanted a piece of Nintendo’s pie. Everyone. There was just no shortage of developer interest. No shortage of games. No shortage of developers, either.

Ultimately, Nintendo shot themselves in the foot by saying a whole lot of “No’s” to potential developers starting from NES onwards. When GameCube came out, about 60% of the developers that were on the “Dream Team” left. It was just too late. Nintendo waited too long to launch a console that played discs or proprietary discs.

The iconic magazine ad – Mortal Monday, September 13th, 1993

Mortal Kombat

Mortal Kombat is one of the most influential, one of the most controversial, one of the most iconic video game in history. There is no video game in the world that can inspire a media storm that Mortal Kombat evoked. Not even Grand Theft Auto. Everyone wanted a piece of the Mortal Kombat pie. Everyone.

Mortal Kombat was at it’s peak in the arcades, and Midway realized this. Midway handed development of Mortal Kombat to several developers responsible for different versions of Mortal Kombat. The media caught wind of it, and started a fire that was on-going into 1993.

Where does Nintendo fit in all of this controversy? Well, that’s where the other controversy existed. The Super Nintendo version of Mortal Kombat nipped blood out completely, replacing blood with dust puffs or water. Fatalities had to be toned down. Many players chose the Genesis version over the Super Nintendo version, thus the Genesis version of Mortal Kombat sold better than the SNES version.

There was so much debate over it, that people said that the Genesis version of Mortal Kombat was better than the SNES version. There was so much ire against the SNES version of the game that even the graphics didn’t save it. Nintendo corrected this “mistake” in two ways: By allowing Mortal Kombat II to include blood and all fatalities intact. Why? Because by this time, there were new ratings labels on boxes. Nintendo also released their own violent video game to show consumers and potential customers that they’re not afraid of video game violence: They released Killer Instinct under the Rare banner.

Again, a little too late…

Nintendo 64
Nintendo’s fourth console, the Nintendo 64

Nintendo 64

From the get-go, Nintendo suffered a huge image problem. They were no longer just a video game manufacturer, developer/publisher of video games, they’re now known as a “kiddy” company. “What’s the big deal with being a Kiddy company?” You would think that, but that whole Mortal Kombat situation I just mentioned? That had major, long-term negative consequences. Developers are no longer interested in making violent video games for Nintendo anymore. As a matter of fact, Mortal Kombat isn’t the only game that was censored because of Nintendo’s rigid “quality control.” Konami had to remove parts of Castlevania IV, to remain “family friendly.” Duke Nukem 3D for N64 removed a lot of the famous sexual references, and mature content.

This meant that many ports to Nintendo consoles had to replace something that made the game fun, engaging, and all around edgy. Obviously, Nintendo alienated much of the market. Fans that stuck with Nintendo until N64 or bought a Nintendo console just gave up at this point.

Part of the reason why Nintendo started to lose marketshare in the industry with Nintendo 64 is because of their bad decisions.

You see, the original name for Nintendo 64 was a cool one. Wait for it…

Nintendo Ultra 64
Before Nintendo 64, the name was Ultra 64.

Ultra 64

For me, this is a facepalm situation. No marketer, in their right mind, would change an edgy name, to a name that was shrouded in negative controversy. There was a lot of marketing strategies already in place for Ultra 64. I mean, Ultra 64 was already in arcades worldwide – a lot of eyeballs, a lot of foot traffic, a lot of “holy $#!^” conversations, and so on. The list is endless. With the release of Crusin’n U.S.A, and Killer Instinct at arcades nationwide and worldwide, it was the perfect marketing strategy. It was the perfect way to get people excited about this new console. Magazines couldn’t stop talking about it, magazines couldn’t turn their heads away from Ultra 64. You had all of these potential with Ultra 64. I project that Nintendo 64 would have sold over 32+ million units worldwide.

With Ultra 64, you were creating demand for the console. You were creating buzz for the console.

Nevermind that Nintendo and Silicon Graphics marketed this console to be the “next gen” console that we all were anxiously awaiting 4 years for. Changing Ultra 64 into Nintendo 64 was a bad move, end of story. All that marketing… Cue those groans, please.

GameCube & Wii

As I’ve explained before, most of the companies that joined the “Dream Team” for N64 has left the building, only a few developers working on GameCube. Sales for games were at an all time low at this point of Nintendo’s life. There were violent games on GameCube, but the 3rd party developers list just shrunk so small that you could only get a few games every season. Wii on the other hand was a bit different, there were more indie developers than there were major 3rd party developers. Most of Wii’s games took advantage of the “Wiimote” controller, but the downside is that most of those games were casual. Not Call of Duty kind of casual, the family friendly kind of casual. Now it seems that Wii U doesn’t have many developers anymore. It’s a pattern that needs to be recognized.

What brought this article on? (Conclusion)
A few articles, actually. The first one is about UbiSoft not making any more mature titles for Wii U. If you read up until this point, you’d understand why this is Nintendo’s own doing. The second one is something I disagree with strongly, I agree with the headline “Nintendo’s 3rd party troubles are their own fault,” which is the point of this article. But, the article talks about how the 3rd party troubles are because “that’s how their business works.” It goes deeper than that.

Nintendo has a hard time attracting developer support for their next generation consoles because consumers, potential customers, and casuals are all “done” with Nintendo’s crap. Consumers are seeing through Nintendo’s mistakes, their in-ability to learn and correct. Potential customers are seeing that consumers don’t like the console. And casuals want something new, and edgy. For example, Wii had lower specs than the competition, nevermind that the console sold over 100 million units worldwide – Wii couldn’t attract hardcore gamers because it was an inferior console offering than the competition. And they did it again with Wii U. The developers don’t want to work with Nintendo because they’re too strict on a lot of things. Every game has to be “family oriented” to a degree. Nintendo has never been open in their approach, Sony has always been open, and cool.

  • G
  • August 28, 2014
While the things you mentioned regarding the early days of licensing fees and strict policies and the whole Mortal Kombat debacle are certainly factors that all worked against Nintendo, I still don't feel that the Wii U's lack of third party support is simply Nintendo's fault. Two reasons.

1. Yes Nintendo was strict early on but many of those policies were dumped long ago. The Nintendo Seal, policies on how many games a company could make and the idea that games had to be family freindly don't exist anymore. The N64 had a number of mature games from both Nintendo's studios and third party studios. They weren't telling companies they could not make these games any more. They aren't limiting the developers on waht they can make or how much they can make. I understand that there could have been some hurt feelings and bad vibes that carried over to the N64 and GC by third parties, but it was their own thinking and not Nintendo's doing. Think of it like this: Germany was home to one of the worst people and one of the worst events in history. Germany has changed and the world does not hold those things against them anymore. The guys who are making Night Trap and said they would never work with Nintendo again are proof of this. Even though Nintendo is not telling them they can't make the game, they are letting the past cloud their vision of the present. Not that anyone wants Night Trap lol, but still.

The second reason is that developers told Nintendo and gamers alike that they would have their full support. EA and Ubisoft both pledged unprecedented support, but within a year had all but pulled that support. You can say it is due to the low number of consoles sold, or you can say that many third party games did not sell well enough, but that is ignoring the fact that many third party games were gimped and that Wii U has the highest software attach rate. I understand if they aren't making money they can't continue to support the system, but there have been games on Wii U that sold as well or better than the other systems versions (when the Wii U version was not void of features or delayed 6 months later). For that reason I can't believe developers who pledged support before the Wii U's launch did not have more games in the pipeline beyond the 1 year mark. It seems to me they were taking a wait and see approach while paying lip service to the gamers. And I understand that the Xbone has been out half as long, but the fact that Wii U is still the second highest selling console makes me wonder why devs continue to announce games for Xbone but not for Wii U. If Wii U is still in second place at the end of next year do you think developers will finally say, OK Wii U still has a larger install base so we'll port games to it as well from now on; or do you think they will continue to say, No the Wii U still does not have enough sales to warrant games from us.
  • H
  • May 7, 2016
For that reason I can't believe developers who pledged support before the Wii U's launch did not have more games in the pipeline beyond the 1 year mark