Nintendo Looking to Boost Wii U Sales with Smartphone Apps

From an earlier post:

The recent gimmicky 3DS (why not 3D too?) and upcoming Wii U (do we still have room for a frikkin’ laser beam in our big-assed does-everything controller?) seems to me to be a break with that customary tight focus, so we’ll see how that plays out.

Looks like not that well.

Nintendo should have focused on making a great stand-alone handheld that also tied into a console unit. Instead, they did it the other way around. While they performed wi-fi wizardry with their controller (screen mirroring is reportedly nearly synchronous with one controller active, and streaming to two controllers at 30 fps is still pretty damn good) it would have been awesome if they had created something like an iPad with physical controls that was capable of interfacing with a console unit. That console could provide expanded storage, a connection to your TV, and a boost in processing power. You know, like AirPlay Mirroring that doesn't suck for gaming. Nintendo's merger of handheld and console divisions is a sign that they might be moving in that direction.

Unlike some other commentators, I don't expect Nintendo to transition to being a software company. They have always made a profit on their consoles and handheld units. Expecting them to forego that revenue is as futile a wish as the bad old days when everyone kept pushing for Apple to license Mac OS. That was actually done briefly in the late 90s when Apple was desperate and flailing, and it was rightly regarded as a mistake.

Nintendo won't transition to making games on other people's platforms because they won't cede control to another company. I can safely say that an official Mario or Zelda game is never going to appear on Apple's iOS App Store. At the same time, Nintendo has shown that they aren't capable of successfully running their own online store. People put up with the Wii store because they loved the crap out of their Wii console and the legacy games that were only available through that avenue. That tolerance would be short-lived if those customers had alternatives on the same device, which would be true for any smartphone platform; Android, iOS, or other.

Part of the problem Nintendo has (which is a weakness shared by many other Japanese companies) is that they don't get online services. Sony's PlayStation Network is a tardy and crappier also-ran next to Microsoft Live, and Nintendo's cumbersome Mii codes, clunky online store, and crippled download system made it clear that they were even more clueless than Sony.

Bottom line: the Wii U is probably not going to sell particularly well, certainly not as well as the original Wii. It probably won't be a total failure, but the future is in handheld units or smartphones, particularly in Japan where HDTV adoption is still fairly low.

[Paraphrased:] "4Gamer readers report only 48.5% have an HDTV in their household. The Ministry of Internal Affairs reports 60.7% of Japanese households have an HD receiver, which is not necessarily the same thing as an HD display."

Nintendo's current Wii U console may well be its last traditional-style console. The question now is whether Apple will exploit its position as a de facto gaming company and create an Apple TV that enhances and expands iOS device capabilities before Nintendo creates a system like the one I outlined above. If that's the case, Nintendo will be competing in very much the same hardware space with the current best computer hardware company in the world, that also has an established and successful multi-billion dollar software store with a fully backwards-compatible library of games and a very low barrier to entry for new potential game developers. Pretty much the opposite of a Blue Ocean Strategy.