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Nintendo's plan to overturn mobile gaming

Super Mario Run may be Nintendo's effort, in concert with Apple, to overthrow F2P dominance of the smartphone market

Nintendo has finally made official the details of its first mobile game launch. We now know that Super Mario Run will arrive on December 15th and that it will be, as promised, a "free-to-start" game (you'll be able to download it and start playing for free) but will not proceed along a free-to-play model. Instead, at some point in the game it'll ask you for a single $9.99 in-app purchase to unlock its full functionality.

The devil is in the details, of course, and it remains to be seen how much Nintendo has been paying attention to the reasons why F2P dominates mobile in the first place. How exactly that IAP will be implemented and how the content it unlocks will be gated will be very interesting to see. Will Super Mario Run let you play the game as long as you like, but only in a very basic mode, without unlocking? Or will it let you play a certain number of times before slamming down a hard barrier that can only be removed by purchasing, an approach that would make any F2P designer recoil in hissing horror? Will the game employ standard retention strategies like daily rewards, which Pokemon Go rather astonishingly only got around to adding recently, or will it eschew these trappings of mobile gaming entirely? Most of all, perhaps, how much of the established structure of mobile gaming can Nintendo just barge through on the strength of its brand and its IP?

$9.99 is an interesting price point, psychologically - it's a very expensive entry point by mobile standards, but probably more realistic than the premium prices companies like Square Enix have tried to charge for some games. Everything Nintendo does in mobile for now is an experiment, of course, but with this price point it's hard not to see them drawing a line in the sand. I imagine that $10 feels like the "right" amount players should be paying for a game, to Nintendo, and by going all-in with their biggest IP from the very outset, the company is essentially trying to push mobile gaming as a whole towards accepting that price point.

"It's a coup for Nintendo...not least since it secured them an unprecedented preorder slot on the iOS App Store for several months, undoubtedly ensuring an enormous launch that may even eclipse that of Pokemon Go"

It's not that Nintendo expects F2P to go away, and I doubt it's even especially opposed to the idea of F2P on some moral ground. It just wants to give itself options and flexibility, to have a chance to fit the right business model to the right game rather than being painted into an F2P corner by the simple fact of creating a mobile game. With Super Mario Run, it's testing to see if it can create a new norm within the market; a $10 price tag on premium, in-demand games.

What's intriguing is the extent to which Nintendo is being aided in this endeavour by Apple. Certainly, it was a coup for Apple to have Super Mario Run on its event stage, and an even bigger one to secure exclusivity (of an as-yet unrevealed nature) for the game on iOS devices. However, these things run both ways; it's a coup for Nintendo too, not least since it secured them an unprecedented preorder slot on the iOS App Store for several months, undoubtedly ensuring an enormous launch that may even eclipse that of Pokemon Go. Both companies are stepping into unknown territory here; Nintendo with the game itself and by working with another platform holder, and Apple with the pre-order and with the very notion of a third-party iOS exclusive game. It's a collaboration, in short, and it's clear that the two companies have had extensive discussions behind the scenes.

The question of business model must have come up in those discussions, and Nintendo's free-to-start, premium IAP model - essentially a shareware style demo and upgrade - most likely has Apple's blessing. That's something of a U-turn for Apple. Although the company has remained publicly agnostic about business models on the App Store for years, its deeds have clearly been aimed at promoting F2P to a large extent. That's understandable; Apple's business is selling hardware, and having an enormous library of software people can download for free is a great way to sell hardware. The reason F2P came to dominate mobile gaming so quickly was that unlike other platform holders (who sell hardware at a loss or at break-even and make their money from software licensing), Apple had no interest in holding up software prices. Freed from the control of a platform holder, prices trended towards the inevitable baseline - zero - and developers found different ways to monetise their work.

Now it seems that Apple is willing, perhaps even actively interested, in exploring alternatives. Maybe the company has come to view the F2P model, which is great in principle but so often abused, as a net negative for its customer base and potentially harmful to sales. Perhaps it's concerned by the ongoing market dominance of such a small number of rapidly ageing game titles, which may be squeezing out other developers and quashing creativity. Perhaps it's simply interested in finding ways to expand the reach of the App Store and believes that encouraging a diversity of business models is a good way of doing so. Most likely, there's a little of all of these motivations in the mix, but the ultimate outcome is the same in any case; in striking its partnership with Nintendo, the closest collaboration it's ever done with a game company, it's given its badge of approval to a radically different approach to selling games on the App Store.

For Nintendo's part, it's obviously taking a big risk; I confess to being moderately surprised, at the time, that it would commit Mario, its most valuable IP, to its very first full-fledged experiment in mobile gaming. My own guess had been that something like Animal Crossing or perhaps even a tie-in with current golden-child Splatoon would have been first to launch; you can't win 'em all, and in this case I clearly overestimated Nintendo's caution with its most precious asset. Perhaps that simply speaks to great confidence in the game they're launching; perhaps it's more a reflection of belief in the robustness of the Mario IP, which has after all survived the character's likeness being plastered all over all sorts of unusual games ever since the era of the NES.

"It's not just Mario who'll get bruised if Super Mario Run doesn't live up to the company's standards. It'll be a blow to the firm's entire medium to long term strategy, and a major challenge to the leadership of its still relatively new CEO, Tatsumi Kimishima"

Perhaps, though, there's a slightly different explanation - one suggested strongly by the enormous hype surrounding Pokemon Sun and Moon on the 3DS, the latest iterations in the venerable Pokemon franchise and unquestionably the most eagerly awaited and loudly hyped iterations in many years. Pokemon Sun and Moon are, of course, the first Pokemon games to launch since Pokemon Go became an overnight phenomenon on mobile devices over the summer. While much of the excitement around Pokemon Go has died down, the sheer degree of brand awareness and interest generated by the game is incalculable; it's quite literally the kind of marketing and publicity that money cannot buy. The boost it will provide to sales of Pokemon Sun and Moon is likely to be significant, as the 3DS titles have already sold-in 10 million copies.

Thinking about timescales, a Super Mario Run launch in mid-December places it a similar distance ahead of the launch of Nintendo's new Switch console as the Pokemon Go launch was ahead of the launch of Pokemon Sun and Moon. It's a somewhat different proposition, of course, but the thinking may well be similar; stirring up enormous interest in a key, classic Nintendo IP - perhaps even one which will be a launch title for Switch - should give a major boost in the arm to the console when it launches. Much of Nintendo's challenge at the moment lies in reactivating its consumers; reminding people who used to be Nintendo players, but have either strayed to PlayStation and Xbox or stopped playing entirely, what they valued about the brand and its games. Mobile gaming isn't just a profitable business for the company, though it certainly hopes it will become that; it's also an outreach program, a way to bring people back into the fold and help the company to sustain its position in the market.

All of this depends, of course, on Super Mario Run being a great experience. In that sense, next month brings a truly enormous risk - far greater than the risk of simply associating the Mario brand with a dud. It's not just Mario who'll get bruised if Super Mario Run doesn't live up to the company's standards. It'll be a blow to the firm's entire medium to long term strategy, and a major challenge to the leadership of its still relatively new CEO, Tatsumi Kimishima. Whatever else Nintendo is thinking about Super Mario Run, you can be absolutely assured that one thought is predominant; the game absolutely has to be good. Luckily, that's not exactly an alien thought for the company - no matter what platform you're working on or what business model you're designing around, some philosophies of game creation are universal.

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Latest comments (6)

Anthony Chan10 months ago
I hope that is the honest truth! It would be awesome if one 'brave leader' were to still recognize the potential for a monetization model that does not involve the current vampiric like activities the current freemium models resemble.

Taking a casual survey of comments on the gaming forums I frequent, many F2P who don't normally pay into a game would probably appreciate a one time fee to unlock vs the current 'pay to win' models that are dominated by 'whales'.

The current freemium is too lucrative to outright die, that is for certain. However, it would be nice if some tried a 'AAA' production game that either utilized a free for the beginning (i.e for RPGs this could entail the first 10 - 15 levels or beginning 3 zones etc), and subscription based service or one time fee unlock for the whole game. The subscription could be 1 or 2$ a month.

Maybe I am just dreaming!
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Hugo Trepanier Game Designer, Behaviour Interactive10 months ago
Anthony, a form of subscription already exists for mobile games, though you typically have to renew your membership every month with a transaction. Often you'll get increased benefits as your VIP status goes up with every purchase. It does not alleviate the need to potentially keep paying for other elements of the game, but it gives you an edge to progress faster, earn more coins or XP, etc.
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Robin Clarke Producer, AppyNation Ltd10 months ago
Good stuff. However I'm still not convinced by this narrative that Nintendo or Apple are trying to divert the established model. There aren't a lot of brands in gaming that can justify a premium price tag that aren't exploiting this already. SMR's model lets them take two bites of the cherry - a one-off payment for a finite arcade style game, and IAP for virtual currency and items in the other two game modes.

Apple have always heavily favoured premium games to F2P in terms of giving them marketing support, taking the view that successful F2P games are able to buy enough visibility on their own.

SMR isn't doing anything new with its monetisation that would need Apple's approval.
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James Berg Games User Researcher, EA Canada10 months ago
The $10 price point is definitely interesting. I hope they're successful, as a consumer I'd be happier seeing more premium titles from quality developers. I too think Run is likely viewed largely as adjunctive marketing for the Switch.
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Emmanuel Dorée Studying Software Engineering, Open University10 months ago
It's going to be interesting to see who is ready to pay $10 for a runner game on a phone. I wish they went instead with a different genre like a puzzle game or a throwback to game and watch games or Wario ware style games etc... Then I wouldn't mind the price tag. I find this game so uninspired so unNintendo. I will be more interested to see their approach with Animal Crossing and Fire Emblem. I hope though that this is successful and that it drives people back to Nintendo consoles.
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Daniel Hughes PhD Researcher, Bangor University10 months ago
As a consumer I'd definitely welcome more high quality mobile titles in the £5-£10 price range. Presumably Nintendo will want their core fans to buy-in first, and will then hope that gamers new to Nintendo either spend through IAP, or enjoy the free trial enough to feel confident that the final product is worth the £8/$10. I also fully expect we'll see Super Mario Switch launching alongside the new machine in March.

The downside is I'm on Android, so I won't be trying Run out until sometime next year!
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