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[onipex]

That's ridiculous. A platform-holder is engaged in a mutually-beneficial business partnership with third party publishers. Their legal responsibility to their shareholders is to maximize the profitability of that arrangement (which is quite literally impossible with as narrowly delineated a "job" as you suggest here) and their non-legal but still manifest and obvious responsibility to their partners in this arrangement is to work as hard as possible to maximize the mutual benefit of all involved parties, not to shrug their shoulders and say "not my problem."*

What I am saying that the main part of that partnership for the platform holder is to make sure the platform sells. The main part of the third party publisher is to make sure the software sells. The only reason money has to be poured into software support now is that the other two platform holders do it.

Nintendo maximized their profits early in the life of the Wii without pouring money into third party support. You can also look at the DS as an example of Nintendo not having to pour money into support.

How beneficial is it to Sony shareholders that they keep pouring money into getting software support for the PSP? A lot of money that goes into getting that support may not be made back when you look at the software sales of the PSP. Even more when you look at the failing hardware sales. Sure the hardware sales at a profit but as I said hardware sales are pretty low too.

What Nintendo is "taking a risk on" is third party publishing as a whole. Nintendo allows it, but at the moment they are receiving an extraordinarily poor return on the money they invest into it because they are accepting essentially zero risk on the entire field of "third-party publishing" and excluding all risk also excludes all worthwhile investment opportunities. This is manifestly unacceptable as a business practice for a company as successful and cash-rich as Nintendo.

I'm pretty sure Microsoft and Sony don't have to pay for every good to great title that their hardware gets. Nintendo mainly failed by not making it clear to third parties they were entering the generation and getting dev kits out as soon as Sony and Microsoft did. That hurt support from the start. Third parties failed by throwing tons of crap at the system to make a quick buck. Nintendo paying for support may not have increased the quality of the software. We have seen many times where that was not the case.

Publishers "expect" incentives because they themselves are consumers in an open market, choosing which competing platform(s) to "buy" their way into releasing on, and that market is sufficiently competitive that courting of this type is the cost said market will bear. Nintendo doesn't just get to choose to be immune to market realities.

Publishers that have high selling software or have proven talent should expect incentives. Every publisher should not expect incentives. You put your titles on the platform that works best for you. In the current marketplace it is best for most publishers to put their software on all platforms so the need for incentives is even less.

Because they took on very little actual financial risk on either. By selling hardware at a profit on day one and offering a selection of guaranteed first-party sellers, both platforms would have produced an overall profit for Nintendo even if the Wii had performed like the Gamecube and the DS had been trounced by the PSP.

This is an admirable strategy for a company like Nintendo to take on core business elements like console releases: since their only business is gaming, they can't rely on other lines of business to prop up a loss-generating failure like Microsoft and Sony can -- but much like investments a balanced portfolio, this needs to be offset by riskier (and higher-reward) expenditures elsewhere: investments that have potential to lose money but also the potential to produce significant success if chosen well. It's the unwillingness to even consider investments like this that seems unique to Nintendo and which is by far the single biggest obstacle to them taking their successes to the next level.

Launching hardware that is totally different than any main platform holder ( maybe ever) is a financial risk even if it is sold at a profit. Are you trying to say that Nintendo would not have lost money from the R&D of the hardware, software development , and the marketing if the Wii and DS failed? If touchscreen and motion controls were totally rejected Nintendo would have lost in their risk. Being a hardware developer the Wii and DS were the biggest risk they could take.


I do agree with you that Nintendo has to offer incentives to third parties to stay competitive so it is their job.

 

[donny2112]

what you and donny are suggesting is tantamount to suggesting that Nintendo shouldn't bother even having ethical (much less constructive) business relationships with small publishers because they don't strictly need to. I'm not going to climb up on that horse with you.

What I am suggesting is that

1) Alchemist (or opinions from Alchemist) is an exceedingly poor example to use to criticize Nintendo for Wii third-party results.

2) Alchemist is an exceeding poor example to use for DS third-party results in that they're late to the system and are only comparing against disk-based systems which intrinsically have different requirements on manufacturing.

3) The DS manufacturing problems are well-known and affect all publishers, even big third-parties and Nintendo.

4) Where the rubber meets the road (i.e. where it counts), DS has been a great boon for many smaller third-parties, such as your just mentioned Level 5. Edit: Rocket Co. and IE Institute also come to mind.

I'm not suggesting that Nintendo shouldn't care about smaller third-parties, but there's certainly been a lot of discussion in this thread pointing to the much greater ROI for focusing on larger third-parties a whole freaking lot more. If it's not a big deal to also help small third-parties in the process, go for it.

My main irk this thread has been the Wii discussion, though. I'm obviously fine with Wii third-party discussion, but it's completely out of place in this thread. Especially, the "See! This is why it was always a good idea for third-parties to ignore the Wii/Nintendo's fault for third-party Wii support/Of course third-parties aren't going to try on Wii with these policies in place" comments. :lol

 

[Shin Johnpv]

Just out of curiosity what is it like in other industries, or earlier in the chain in this example, in regards to paying the manufacturing costs upfront? Is Nintendo forced to pay for the memory chips used in the DS carts upfront? In the pre-built PC market is Dell/HP paying for the ram parts or CPU chips used upfront? In clothing, is a company paying upfront for the blank t-shirts before they put their designs on them?

Honestly I have no idea, just trying to get some perspective on it. Before reading some of the posts on here calling that awful, it would have seemed the obvious default to me.

 

[viciouskillersquirrel]

Just out of curiosity what is it like in other industries, or earlier in the chain in this example, in regards to paying the manufacturing costs upfront? Is Nintendo forced to pay for the memory chips used in the DS carts upfront? In the pre-built PC market is Dell/HP paying for the ram parts or CPU chips used upfront? In clothing, is a company paying upfront for the blank t-shirts before they put their designs on them?

Honestly I have no idea, just trying to get some perspective on it. Before reading some of the posts on here calling that awful, it would have seemed the obvious default to me.

Usual practice is partial payment up front and the balance on delivery.

 

[Thunder Monkey]

I'll light the pitchforks and bring extra torches for stabbing if you want.

And this is why squirrels are my conscience.

 

[iamaustrian]

the only real issue 3rd parties have with Nintendo is the quality.
Nintendo developed games are miles ahead of pretty much all other stuff.

 

[EVH]

the only real issue 3rd parties have with Nintendo is the quality.
Nintendo developed games are miles ahead of pretty much all other stuff.

Yeah, not really. The issue with nintendo 3rd parties is marketing and nintendo fans.

 

[gerg]

Wait, not making systems region-free is unethical?

Someone please say that I'm misinterpreting viciouskillersquirrel's statement.

 

[Cosmonaut X]

Wait, not making systems region-free is unethical?

Someone please say that I'm misinterpreting viciouskillersquirrel's statement.

I think that that one would come under his heading of "treating customers like crap" rather than "unethical".

 

[gerg]

I think that that one would come under his heading of "treating customers like crap" rather than "unethical".

Fairs dos.

 

[iamaustrian]

Yeah, not really. The issue with nintendo 3rd parties is marketing and nintendo fans.

I don't see an issue with taking high-quality software over the low-budget cash-in shit 95% of 3rd parties are offering

 

[Sipowicz]

I don't see an issue with taking high-quality software over the low-budget cash-in shit 95% of 3rd parties are offering

yep

on the 3DS for example i expect street fighter and resident evil to do well.big titles, big publishers, well known series and i'm guessing it'll be damn good quality too

i expect the splinter cell game and everything EA puts out to do poorly. por quality, obvious shovelware shit

 

[Cosmonaut X]

yep

on the 3DS for example i expect street fighter and resident evil to do well.big titles, big publishers, well known series and i'm guessing it'll be damn good quality too

i expect the splinter cell game and everything EA puts out to do poorly. por quality, obvious shovelware shit

Good grief... is there ever going to be a time when you shut up about EA? It's like reading posts from a bitter ex-lover who can't resist needling at their ex in everything they write...

 

[Sipowicz]

Good grief... is there ever going to be a time when you shut up about EA? It's like reading posts from a bitter ex-lover who can't resist needling at their ex in everything they write...

the truth's the truth

if they were puttingout good, obviously high quality stuff like a lot of the japanese third parties i'd be praising them. they're not, they're putting out rushed shovelware. yet they'll still bemoan their deservedly poor sales as will many other western third parties in a similar situation

nintendo have a lot of issues with third parties. but some third parties are just shit and always will be

 

[truly101]

I can't believe it took me this long to read this thread. :lol :lol :lol Never change, Nintendo fanboys

 

[mrklaw]

Just out of curiosity what is it like in other industries, or earlier in the chain in this example, in regards to paying the manufacturing costs upfront? Is Nintendo forced to pay for the memory chips used in the DS carts upfront? In the pre-built PC market is Dell/HP paying for the ram parts or CPU chips used upfront? In clothing, is a company paying upfront for the blank t-shirts before they put their designs on them?

Honestly I have no idea, just trying to get some perspective on it. Before reading some of the posts on here calling that awful, it would have seemed the obvious default to me.

depends who you are in the food chain. If you're big enough, you would try and force at minimium 90 day terms on suppliers. So you give me the chips, invoice me and I'll pay you in 90 days.


This is classic Nintendo, but it was worse for N64 from what I remember. Lead times were at least 6-8 weeks and unit reorders were similar (10k units I think).

Partly though its a restriction of the media they use - sony has dedicated facilities they can churn out blurays from - their costs are lower, lead times are shorter. That gives them more flexibility in the business models they can offer.

 

[Zoe]

Just out of curiosity what is it like in other industries, or earlier in the chain in this example, in regards to paying the manufacturing costs upfront? Is Nintendo forced to pay for the memory chips used in the DS carts upfront? In the pre-built PC market is Dell/HP paying for the ram parts or CPU chips used upfront? In clothing, is a company paying upfront for the blank t-shirts before they put their designs on them?

Honestly I have no idea, just trying to get some perspective on it. Before reading some of the posts on here calling that awful, it would have seemed the obvious default to me.

Not sure about now, but when Dell started out, they were buying all the parts with credit, so they were able to get the computers in customer's hands before payment for the parts was due.

 

[charlequin]

The only reason money has to be poured into software support now is that the other two platform holders do it.

Well, sure, but caring about that distinction is kind of silly. When you're competing with other businesses, you have to do things you wouldn't do except in order to fight those competitors. In fact, the very nature of competition is to destroy profits and force companies to court customers and partners more aggressively -- that's the underlying nature of the capitalistic system and the situation every company knows it's getting into when it competes with others.

If lack of third-party support is reducing Nintendo's profitability (it is), and the nature of competition in their field means that improving third-party software means actively courting publishers (it does), then Nintendo needs to find a clever end-run around the problem or suck it up, accept that these are the conditions on the ground in their field, and play ball. They tried the former with the Wii (betting that raw sales would generate the support they wanted) and it didn't work out, so at this point playing ball is really what's left on the table.

How beneficial is it to Sony shareholders that they keep pouring money into getting software support for the PSP?

Not very, but that's an entirely different situation. The PSP is a different platform with a different price, different level of success in different territories, different target market, etc. Throwing money at third-party support from Western studios is a waste there because it doesn't stick (they've demonstrably thrown a few games at the system and then left again), because the system's already getting plenty of unpaid support from Japan, and because Sony let the platform languish for a few years while they fixed up the PS3 business and as a result it's not in a good enough state to actually benefit from more software.

No one is suggesting that Nintendo should adopt an open-wallet policy where they throw huge cartoonish checks at every publisher for exclusives, despite how many times this strawman is propped up in every single thread about Nintendo and third parties. What I in particular am suggesting is:

• Replacing publisher-unfriendly blanket policies with friendlier ones to draw in small publisher support on the margins
• Maintaining active, positive relationships with third parties where Nintendo demonstrates their enthusiasm for having them on the platform and provides them the tools and resources needed to do their jobs (dev kits, development support, early access to information, prominent positioning in "platform advertising," bundle deals, etc.)
• Entering into carefully-selected partnerships early in a system's life, when the potential to build a third-party ecosystem is still there, to bring "umbrella titles" to the system and thereby create the room for other, smaller titles in the same genres to follow.

Nintendo doing what Microsoft has been thought of as doing (just throwing money at every big third-party game) would be a terrible strategy, but there's a near-infinite range of possibilities between that and Nintendo's current strategy and I'm arguing for a point somewhere in the middle.

Are you trying to say that Nintendo would not have lost money from the R&D of the hardware, software development , and the marketing if the Wii and DS failed?

One has to define "failed" here, but yes, I am asserting that they would not have lost money had the Wii sold on Gamecube levels and the DS sold half as well as the GBA, say. Nintendo remained profitable throughout the Gamecube era and that was certainly a huge failure of a system by almost every measure.

I think it's worth noting that I actually think this aspect of Nintendo's business is admirable and wise. Being able to survive an underwhelming console entry is very important and a huge part of why Nintendo could afford to do wacky and unexpected things like Wii and DS. But you simply can't run a business effectively in the long run by avoiding financial risk and if Nintendo wants to preserve what they've carved out with the DS and Wii they need to move into some areas outside their comfort zone.