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IGN: Exactly How Bad is the Nintendo Situation?

B

BY2K

Membero Americo
Doom me if old.

http://ca.ign.com/articles/2013/07/31/exactly-how-bad-is-the-nintendo-situation

The short answer, for now, is no. Nintendo isn’t about to go bust. It still posted a profit, thanks to its assets and investments and favourable changes in the currency market. The Wii U is costing money, which means that Nintendo is making an operating loss when it comes to actually selling games and consoles, but it’s a very, very long way from bankrupting the firm. The 3DS, meanwhile, is a big success - it’s not matching the insane sales that the original DS was generating, but then the original DS didn’t have smartphones to compete with.
Click to expand...

Even the Nintendo consoles that aren’t regarded as particularly successful - the Gamecube and the N64 - have always made Nintendo money. This is, let’s remember, a company that has only posted one year-end loss in its entire history, in 2012. This is one of the reasons that Nintendo’s future isn’t in jeopardy: the company is extraordinarily solvent. It’s got warehouses full of cash. Seriously, take a look at Nintendo’s assets: it has 492,334,000,000 yen in cash. That’s $5,038,214,927.30. More than 5 billion dollars. In cash. And almost that much in “short-term investment securities”, which are essentially bonds.
Click to expand...

It’s too early to write the Wii U off as a failure already, but even if things don’t pick up and the console does end up a flop, Nintendo could weather it. It could weather several such failures. Other companies - Microsoft’s Xbox division and Sony Computer Entertainment among them - have operated at huge losses for years on end, but Nintendo has never done business that way.

This is why, if you ask me, there is no chance that Nintendo will exit the hardware market. Certainly not in the medium-term future, and possibly not ever. Why would Nintendo release its games, its major selling point, on other people’s platforms when it can continue to have total control over its own? Of those 11 million 3DS games sold in the last 3 months, most of them were Nintendo-published, and Nintendo didn’t have to pay a penny to any other platform holder.

Nintendo can afford to own its own platforms for a long time yet. The Wii U is really, really struggling, but in the grand scheme of Nintendo’s operations it actually doesn’t matter as much as you might expect. That’s reflected in Nintendo’s share price, which took a 6% hit in the past week but is actually 37% up on this time last year.
Click to expand...
 
B

Bel_Air_Jeff

Banned
Yep.

Nintendo has nothing to worry about.

Although, I'd like them to flex their muscles a little bit and start playing with the big boys.
 
C

Coffee Dog

Banned
I mostly agree with the article.

It'll take at least two more consoles bombing as bad as the WiiU for nintendo to consider going third party or abandoning consoles. They have too much money and are far too stubborn.
 
M

Mr. Poolman

Member
Unusually sensible article.

Even as it might look like some people want Nintendo to go down, it would take a truly catastrophic event for it to happen.
 
B

Broken Joystick

At least you can talk. Who are you?
It sucks for sure that the Wii U isn't too good right now, especially for Wii U owners, who have no idea what the future is for the console and if this trend of missing out on third party games or certain options in them will continue.

But the article is right, in the grand scheme of it all, while Nintendo should be worried about what they're doing, the Wii U failing isn't the be all and end all for the console.

Now hurry up with those Wii U games Nintendo, I need my fix.
 
M

Majine

Banned
Then again, I don't think anyone with a brain wants Nintendo out of the game. Just something else than the Wii U.
 
A

AndrewDean84xX

Banned
Just give me more games along the lines of quality as Pikmin 3 Nintendo, and we are golden. Gaming is better as long as Nintendo is putting out games on their own platforms.
 
B

Bluemercury

Member
I might bite the wiiu when it starts to get more support and i don't mean AAA support either. I just need to see more indie games really getting released.
 
N

Not Spaceghost

Spaceghost
Still doesn't change the fact that the Wii U situation itself is a big old mess.

I am glad that this means nintendo wouldn't come close to death if the Wii U truly tanks.
 
K

kswiston

Member
Nintendo was never going to go third party over one major flop, even if the WIi U ends up being this generation's Saturn or Dreamcast.
 
F

Fletcher

Member
Good. I like having a Nintendo console. Now they just need to re-focus. The casual/peripheral train has passed. Make a for real console again.
 
P

Price Drop

Member
That's what a lot of people don't understand about Nintendo. You don't have to be the most popular product to make the most money.

The company has always been the most fiscally conservative when it comes to hardware. It does result in the company being lackluster in terms of graphics performance, but it is able to take in much larger margins on games and hardware by being in control of both.

It would be great if the company would invest a little more cash to boost internal development teams so that the console division isn't always so stretched in resources. Also, they really need to boost that marketing budget for the Wii U since the launch buzz is over and sales have dropped off significantly.
 
S

Sulik2

Member
The problem is your stock holders aren't going to enjoy seeing the Wii U losing money quarter after quarter for the next three years. Even though you have the cash reserves to afford it. Whether Nintendo is going to have the shareholder support to launch the home console successor to the Wii U is what intrigues me. When you balance the risk of another Wii U flop vs going third party on home consoles and guaranteeing a return.
 
H

Heyt

Banned
Is WiiU failture going to Kill Nintendo?

No

Is WiiU a pernicious moneyhole for the company?

Yes.

Nintendo is going to be here for decades but that does not make WiiU's failture irrelevant.
 
S

SparkTR

Member
The situation is fatal for the Wii U, but just wasted time for Nintendo. They have enough in reserve to do better next time. The biggest issue is that they're forced to waste time with the Wii U now that they botched its launch, and time is money.
 
E

Eiolon

Member
I think it's important that Nintendo rides this out. If it throws in the towel on the Wii U sooner than expected it could lose consumer confidence and trust in its future consoles. As the article said, Nintendo has cash. It's not in a large amount of debt like when Sega threw in the towel for the Saturn. It can afford another 2 or 3 more Wii U catastrophes before it has to start to worry. Iwata, though... not so much...
 
C

captmcblack

Member
This article is too sensible to be worth anything.

Most everyone - at least the type of everyone that posts on game forums and in the comments section of game websites - knows this.

But it's a lot more fun to ride the Nintendoom wave, which clearly has historically always worked out for everyone hoping for it, right?


That said, the Wii U would be a brutal failure ala Virtual Boy if it continues the way it's going too long past this first year. It hasn't even been out a year yet, and it's the only next-gen console in town - so the situation isn't rock bottom yet - but it's not looking good without even the tried-and-true Nintendo ace software to prop it up yet.
 
H

HawksWinStanley

Member
Nobody wants their products; I'd say the situation is pretty bad.

They'll bounce back though. There's nothing wrong with the Wii U itself, it just doesn't have any games I want to play. And it looks like I'm not alone.
 
S

SmokyDave

Member
Seriously, take a look at Nintendo’s assets: it has 492,334,000,000 yen in cash. That’s $5,038,214,927.30. More than 5 billion dollars. In cash. And almost that much in “short-term investment securities”, which are essentially bonds.
Click to expand...

Is this how people arrive at the fabled '10 billion plus' warchest?

Is it 'cash & short-term investment securities', rather than just cash?

I'm trying to get a handle on how long these coffers can last. People make it sound like they can just roll on for gen after gen on cash reserves alone, but I'm not convinced.

captmcblack said:
This article is too sensible to be worth anything.

Most everyone - at least the type of everyone that posts on game forums and in the comments section of game websites - knows this.

But it's a lot more fun to ride the Nintendoom wave, which clearly has historically always worked out for everyone hoping for it, right?
Click to expand...
When the first word in the topic is 'doom', what do you expect?

I bet 'doom / doomed' appear more in posts pre-emptively whining than they ever have in the posts of 'haters' or the 'delusional' or whatever the current buzzword is..
 
RomanceDawn

RomanceDawn

Member
Estocolmo said:
So basically, Nintendo has a lot of cash in the bank and thats why the situation isnt bad?
Click to expand...

No, that's why the situation isn't as bad as others make it out to be. It's bad that's for sure, but if the Wii U fails to ever catch on this won't end Nintendo basically.
 
C

cacildo

Member
I dont fear for nintendo´s future.

I just want the WiiU to be sucessful because i have one, and i want to play good games on it.

Because someday I WILL finish earthbound and then ill have nothing else to play single player!
 
B

BD1

Banned
I'd be more worried about the brand erosion than the operating losses right now, if I was Nintendo. Wii U isn't going to put them out of the hardware business, but the reputation of Nintendo has taken a pounding the last 10 months.
 
7

7threst

Member
Most people didn't really think Nintendo would leave the hardware business and would go third-party, I hope?

Anyway, good article. Will this put an end to the endless stream of 'Nintendo is doomed'-articles? I don't think so. Then again, the doomed-threads are pretty fun to read so... :)
 
E

EloquentM

aka Mannny
BD1 said:
I'd be more worried about the brand erosion than the operating losses right now, if I was Nintendo. Wii U isn't going to put them out of the hardware business, but the reputation of Nintendo has taken a pounding the last 10 months.
Click to expand...
Much longer than 10 months
 
M

Midnight Moon

Banned
Even after reading this, the detractors will never shut up. I could see Nintendo dumping Wii U if it doesn't pick up after this holiday season, but it's not gonna stop Nintendo from releasing systems in the future. However, it will make them less likely to rush a system to market though too.
 
P

-Pyromaniac-

Member
To me it was never about Nintendo's imminent doom. They're obviously very far off from simply dying. But the huge detriment here with the Wii U is risking irrelevance. 5 years of no one giving a shit about you can cast you off to oblivion. This isn't their death knell but it could be the writing on the wall.

They'll have to turn it up to 50 with the successor in just about every way to recover and gain mindshare back and that's just not easy. Especially from a company that seems to be showing that they aren't fully capable of doing this.
 
R

Rvaisse

Member
Funny thing is we'll certainly be dead first, nintendo is here for more than a hundred years guys...
It was here before anyone of us!

Glad to see this from IGN.
Now, some of you should print it and stick it right in front of your eyes.
 
N

Ninja Scooter

Member
Saying the Wii U is doomed is not the same as saying Nintendo is doomed. Nintendo will continue to do business. The Wii U has no chance of turning it around, though.
 
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