Will Next-Gen Cripple Nintendo?
In 2006, Nintendo released a console that many expected to fail and cited the motion control gimmick as a reason as to why. To everyone’s surprise, the Wii caught on like a wildfire and retailers couldn’t keep them on store shelves. The company struck a gold mine by managing to tap into a market that had yet to be discovered, engaging soccer moms, the elderly, young kids, and casual gamers alike through easy-to-use gaming software like Wii Sports. Unfortunately, while the Wii was a huge commercial success, the platform was riddled with shovelware, poor third-party support, and finally, when tablet gaming took an upwards swing, the Wii’s sales began to suffer. Despite these shortcomings, gamers who owned the console were still exceedingly happy with the strong first party support that Nintendo has been known for since the NES.
It’s at this point in time that many thought maybe Nintendo was turning over a new leaf and finally moving away from the disastrous retail experiences it had produced the previous two generations that featured the Nintendo 64 and GameCube. When the Wii U released, it did very well at retail. It wasn’t an immediate commercial powerhouse like its predecessor, but it did exceedingly well and gamers were happy with the end product. Many thought that with the inclusion of strong third party support, the Wii U would correct the issues plaguing the Wii and that third party developers would embrace the platform. At first, this looked to be the case as the Wii U launched with popular titles like Assassin’s Creed 3, Mass Effect 3, Darksiders 2, Batman: Arkham City, and Ninja Gaiden 3. Sadly, these third party titles were not nearly successful enough during the launch window and most sold poorly.
From this point, third-party developers and publishers took notice of the lack of software sales outside of Nintendo’s core lineup of first-party offerings. Shortly after the system’s launch, Ubisoft announced that Rayman Legends, originally planned as exclusive to the Wii U, would be releasing on multiple platforms and, despite the Wii U version being finished, they were launching all versions simultaneously. This left a gaping hole of respectable software releases on the console and in return, console sales have suffered. Unlike the Wii, the Wii U saw devastatingly low retail sales in North America in January and February. Sales in January ended up being a dismal 57,000 while February sold only 64,000. We’ve yet to see sales figures for March, but given that March saw the release of the highly anticipated Monster Hunter franchise and a sleeper hit in LEGO City Undercover, it should provide the console giant the opportunity to increase sales significantly.
Depending on how things pan out with March sales due to two strong retail releases, one might think that Nintendo may be able to turn things around. However, after GDC 13 took place this past week, it looks like that uphill climb is going to be a little bit tougher for Nintendo in the long run. Over the course of the week, DICE showed off the Frostbite Engine with Battlefield 4. While the reception to this trailer was critically high, the tidbit of information that the Wii U would not be able to run the Frostbite Engine is a huge blow to Nintendo bringing in third party support. Considering major franchises like Mass Effect and Dragon’s Age are also planning to utilize this engine, it’s highly likely that they won’t be making an appearance on the Nintendo platform. Obviously developers choosing to use this engine do have the option to dumb it down enough to operate on the Wii U, but at that point there is a strong chance it will be a significantly inferior product and in turn, will hurt sales figures.
On the heels of the announcement that Frostbite would not support the Wii U, it was revealed that Epic’s Unreal Engine 4 would have the possibility of being scaled to the platform. While the ability to scale the engine is great in theory, developers will have to spend extra money in development in order to make this happen. If the Wii is any indication to go on, a lot of dev teams will decide not to spend the added cash. Frankly, this is a much larger blow to Nintendo’s platform than one may initially think. When you take into consideration how widely licensed Unreal Engine 3 is by developers, it goes without saying that a strong chunk of third-party titles from AAA developers won’t be releasing on Nintendo’s console. Over 200 titles licensed Unreal Engine 3 during this generation cycle and considering the abilities that were displayed in the tech demo for Unreal Engine 4, these numbers may climb.
This is a strong indication that, once again, Wii U owners are not going to be provided a consistent lineup of third-party software and will have to rely on strong first-party offerings from Nintendo. Of course, this is going to be perfectly acceptable to a lot of gamers. After all, Nintendo’s core franchises have sold tens of millions of units over its lifetime and will continue to sell extremely well. However, this should be a detriment to overall retail success and may push Nintendo back into the 20-30 million units sold range as the N64 and GameCube were.
In the end, Nintendo isn’t going to disappear regardless of the sales figures produced by the Wii U throughout its cycle. There is a good chance that Nintendo is going to be quite profitable over the long run of this generation, but one must ask: Is it worth spending the money on research and development of new console for the next generation? The answer to that remains to be seen since it’s way too early to truly tell. Obviously Nintendo is still raking in cash on the handheld front and it’s doubtful that will ever cease to be reality as the grip they have on that market is God-like.
However, how much more profitable could Nintendo be if they finally broke down and decided to develop strong third-party titles themselves for the PlayStation and Xbox consoles? They could still own and dominate the handheld market, but they would also be tapping into a much larger user base by releasing titles on the competitor’s platform as well. If Microsoft and Sony can combine to sell 170+ million units this next generation — which is highly possible — would that be better in the long run for Nintendo rather than trying to push Mario on a platform that may only sell 20 million units? Regardless, this upcoming generation of consoles is going to be an indication of what we can expect from Nintendo in the future and we’re all curious to see how it ends up.