Iwata takes 50% pay cut and takes "responsibility" for 3DS
Nintendo president halves salary whilst other execs cut 20, 30%
Nintendo president Satoru Iwata has announced that he's to take a fifty per cent pay cut in order to help ameliorate the financial problems currently affecting the publisher.
Iwata announced the news in a press conference which took place in Tokyo this morning, reports Kotaku. Nintendo made the comments public almost immediately and have promised a full transcript of the Q&A.
Announcing the cut, Iwata said he took responsibility for the 3DS and its poor sales and was willing to make a fiscal sacrifice.
"For cuts in fixed salaries, I'm taking a fifty percent cut, other representative directors are taking a 30 percent cut, and other execs are taking a 20 percent cut," Iwata told attendees.
Attending the event was Tokyo-based Macquarie Securities analyst Dave Gibson. Reporting back to press afterwards, Gibson claimed that Nintendo had acknowledged a missed opportunity in its refusal to make an early price cut for the Gamecube, and wanted to avoid the same mistake, but admitted that the reduced price would mean that Nintendo no longer made money on 3DS sales.
That will undoubtedly change as the economies of scale make the 3DS easier and cheaper, but the decision to sell hardware at a loss is a significant move for Nintendo, which ordinarily ensures that profit is made on each individual unit sale.
But they need to release more 3ds games in the uk and usa.
It would have been nice for Nintendo to maybe poke around BEFORE they did R + D on the thing and check history (and not just their own failure with the Virtual Boy). 3D was, is and will always be a fad that lasts about 3-5 years then goes away once people get sick of it. Period. No matter the tech advances, a gimmick is a gimmick, glasses or no glasses. Even Augmented Reality, which is very cool, can only go so far once it gets so much into the mainstream that it's no longer seen as exciting.
3D reached its peak with Avatar (a film I didn't like because of the plot - the visuals were stunning) and it's been going downhill since everyone decided they wanted to do the same thing, but on a shoestring or in a way that made it too damn pedestrian. Of course, any 3DTV/monitor or other device maker will argue otherwise. But after 47 years of life and 39 of that spent gaming, I think I've seen more than enough of this cycle of "Hey, Lookit!" come and go trendiness to know when something's going to die off.
Next up, the current casual bubble that some are thinking will kill off retail and/or expensive games. I got my stale popcorn and good seat for this one... it's taking longer than it should, but it'll happen. Not that I'm happy about any of this crap, mind you. I just wish some companies would pick the brains of guys like me before they spend all that money on something that's going to die on the vine...
On top of that, most people think the 3DS is DSI with 3d support, they don't realise it's more of a comparison of NES and SNES. There is so much misinformation about this console out there , the fact it looks near identical to past DS's doesn't help.
The iOS mobile platform (Android too) is a jack-of-all-trades computer platform where anybody can toss anything on the market and see if it sticks.
The consoles were able to suppress the early PC (home computer) dominance by being easier to set up and having subsidized hardware. Prices for games were roughly the same. Established manufacturers were always heavily attacked by new competitors having a more open 3rd party publishing policy. See a pattern emerge for handhelds yet?
The 3DS is neither easier to set up, nor cheaper than the Apple/Google competition, nor are the games cheaper, nor perceived to be better. And for every $40 game connoisseur, there are 100 Angry birds idiots; do the math. Nintendo needs to move out of Dinosaur country, open their platform wide, make sure there is a good online venue to sell software and let any game developer go buckwild crazy, from EA to Johnny's basement games. Who cares if there are $1 games, as long as they sell and Nintendo gets 30%. iOS does not mean people spend less, it just means people spread it around more. That is only bad news if you thought your games were the second coming of Christ in digital form, but 30% of anything is still 30% of everything. Ask Apple's $40 billion stash of money about it.
Imagine a proper handheld device, with real precision controls and the software library of iOS and Steam combined. Not just gaming software, but all the crazy stuff from the App store as well. That is where you want to be today. That is where Apple already is and they profit off games even though they do not give a rats ass about decent controls. That is the huge gamble Nintendo has to make right now. $40 Pokemon games will sell anyway, those players will still be there, but the mass audience is rapidly shifting away to the "iPhone" experience, which is eerily similar to people dropping quarters into an arcade machine in the 80ies with Apple operating the arcade. I guess everything is diminishing returns after all.
Edited 1 times. Last edit by Dennis Wan on 1st August 2011 2:04am
Nintendo has a quarterly loss because of unfavorable currency exchange rates and lower than expected hardware sales of the 3DS and all the top executives take pay and bonus cuts. No bail outs, no mass employee layoffs....never seen another company of this size show such humility in penance for arrogance. Much less reward themselves for it.
IMO, Nintendo planned this to give 3rd parties a great launch window to launch their software, and make some money - but they would have never imagined the exact opposite to happen. All Nintendo had to do was launch with a single massive title (Mario Kart or Mario) - that would have set hardware sales going, which would have resulted in a lot more 3D part software arriving. But they didn't - and it now feels like a "soft" launch, that is only now starting to build some momentum (almost a year after launch!).
Wii - then releasing the wii motion plus which you HAVE TO BUY to make it work
DS - too big and ugly, so they release the DSlite. Then the DSi and the bigger DS (my goodness)!
now 3DS, it clearly isn't perfect. I bet they have something which will have a longer battery life, or a more perect 3D screen, or it will be 5 times as big and make your coffee in the morning. I don't know.
This shows the beginning of the end. In 10 years, I'll be surpised if they are still an independent company.
A bit of an exaggeration, perhaps?! If Nintendo have shown one thing in the past 6 or 7 years it's that they're adaptable and can create and/or lead market trends. Just because this is probably the first significant bump in the road for them in at least 10 years does not mean the company is now a fading light by a long stretch.