David Yarnton: It's really tough, actually, because we could fill ten newspapers with stories as far as what we've got. That's one of the reasons why we're having this "early Christmas" - because we believe that with retail having been so tough, that we've got so much to offer them now.
It's really hard to pull individual things out... You mentioned Nintendogs, and obviously that's one that we see not just being big when it launches in October, but also running right through to Christmas. I think one of the other big ones that's going to come out and - well, I wouldn't say surprise everyone, because it's a very strong franchise - is Mario Kart on DS. It's the wi-fi side of it - that's something that's going to creep up and surprise everyone, because the way we're trying to do it is to make it so easy for people.
I think the other thing is Micro. A lot of people were looking at it when we had SP, DS, and now we're talking about Micro - they were kind of scratching their heads a bit and going, hang on, you're trying to be everything, how does it all work, you're going to cannibalise one or the other. When we launched DS, it proved that it didn't cannibalise SP - we've actually grown the market, and with Micro we'll see the same thing as well.
That's one of the big things - the whole thing Nintendo has been looking at. The innovation, not just with hardware but also with software, is to grow the market.
I think in a way, if I wanted to have just one headline, it would be that to some extent, Nintendo takes a responsible attitude to our industry by looking to innovate and expand it. A lot of people talk about growing their business, but that's really just from releasing new product and hoping it's a hit rather than looking at ways to get new people into the business.By focusing on bringing in new demographics, does it concern you that you could alienate your core market and leave behind the people - the fans - who have made Nintendo so successful? Or is it easy to strike a balance between the two?
Definitely not! You definitely couldn't say it's easy, but then life wasn't meant to be easy. It's always a challenge, and especially when you're a company like Nintendo, being innovative, and people look and say "why are you doing that?"
It's because if you go back historically, videogames basically disappeared, and Nintendo basically resurrected it. We're not saying that we're in that position now of having to ressurect the industry, but to keep its vitality and keep it growing, we need to expand it. We still can't and won't neglect our existing fans, and I think that one of the things that's been really positive news in terms of Revolution is the fact that it will be backwards compatible, going right back through the back catalogue to NES and SNES and everything else.
So that's not neglecting our existing market. If you look at it, the existing market is so big - we're going to take our chunk of that. Other people are going to take probably bigger chunks, smaller chunks, whatever. But there's this whole area out there - I remember at the Games Summit recently someone was talking about the mobile phone market, and saying that there are 65 billion phones or whatever out there, and then you look at TV and DVD penetration. If you look at videogames, I think in the UK we're in about 30 per cent of homes. If you look at DVDs, it's around 95 per cent.
So if we're at that 30 per cent, how do we break out to 50, 60 per cent of homes, and people, playing? We have to - we want to do that to try and grow the business.So far most of your innovation seems to be focused on handheld gaming, whereas Sony has done a lot of work in reaching out to new markets with home console titles like Singstar and EyeToy. Are you planning more titles like that for the Cube, or are we waiting for Revolution to see home console innovation from Nintendo?
I think a lot of people forget where the innovation has really come from. When you first start looking at console gaming, you look at the start of various eras - even going back to N64, with GoldenEye and things like that, with the controller, with Mario and its 360 degree gameplay. All those sorts of things. The hand controllers being the way that they are... That came from Nintendo.
We've got voice control on Mario Party on GameCube. With Donkey Konga, we've got bongos. We've got dance mats as well, they've been around for a while. If you go back even further, to the NES or SNES days, they had online capabilities that let you use the stock exchange and things like that in Japan.
So a lot of things that people look at now and say, wow, look at the innovation - Nintendo has done, or has been doing, for quite some time. I think the same thing going forward, with Revolution that's one of the things we're talking about - in that as much as we're seeking to innovate with DS, bringing new people in and making it easy for people to play, we'll see that being part of Revolution as well.This week sees the launch of the PlayStation Portable in the UK, probably the most serious challenger you've ever had in the handheld space. How do you see that impacting Nintendo in the run-up to Christmas?
Well, it's really not going to change any of our planning, because we see what we've got in terms of our line-up etcetera - we're quite targeted in some of the areas we're looking at. Looking at year to date so far, we're about 91 per cent up year on year on handheld, so we're well on track. We're looking at 50 per cent growth, and we're well on track to achieving that.
Really, whenever someone else has come into the market, whether it be Sony or Microsoft, it's been really good - because what it's done is focused a lot of attention on the industry, and I think it has always grown it a bit more. If we look at this year, just look at the amount of media attention that's been given to handheld since Sony started looking to get into the market - it's been really positive. We've had huge growth since that's happened.
So the easy answer is to say that they won't affect us, but I think they'll affect the industry - because they'll focus more attention on us, with people talking about it, and it could also bring more people in just the same as DS. We think it's pretty positive.You feel strongly that there's enough space in that market for two players, then?
It's like anything - if we're looking at any product that's competing for people's disposable income. There are lots of things that are competing for the market share, not just in the videogame industry but from outside it as well. It's the same people that we're looking for. It's not just Sony that's competition, it's other areas - you're talking about Apple iPods, the things that kids want nowadays, even traditional things like bikes, all those sorts of things.
There's competition for the consumer's money from everywhere - but I think what this is doing is that maybe when people are thinking about spending their money, they're thinking more about videogames because there's so much publicity about it right now.Looking a little closer at your Christmas line-up, you've had a few disappointments like Zelda and Metroid Prime Hunters slipping into 2006 - have those left a hole in your release schedule?
Actually, to some extent, if I turned around to our marketing and said, "we've got this that and the other, three big new titles"... Even one new title, they'd probably throttle me! We've got so much to offer at the moment. When we talk to retailers, they're obviously disappointed about Zelda, but they understand - they say, "look, we think this is the right decision, because the franchise is so good that it should be right."
That's one of the things we always want to make sure, and what we've always done with Nintendo product is to make sure it's right and that it is fully complete. If we released something that was half-complete or not as good as expectations, it could ruin the franchise.Without Zelda, what's left on the Cube this Christmas?
Oh! We've got Pokemon XD, we've got Mario Smash Football - which actually, I think is going to be really, really big. We look historically at a lot of the games we've had previous success on with Mario on GameCube, and Tennis didn't do well... But you know, tennis isn't really a mainstream activity in the UK. Football, though - I wouldn't say everyone loves it, but it's very very popular. With Mario as well - the strength of the brand, with Mario Kart and all the games we've had - the combination of the two will be really positive.
The other great thing about it is that there's been... I would a slight twist on Mario with Smash Football, because he's not quite the Mario that people have grown to know. He's got a little bit more reach to him, a little bit funkier. That's not to say that people won't still see Mario as they normally have, but in this game, I think it's going to be really good. It's probably, to some extent, got some broad appeal.
Zelda has got lots of fans, and everyone's disappointed on it, but what we've seen coming is going to look fantastic.Do you think it's going to be a strong Christmas for GameCube, then?
We've got a very good line-up first party, but the other great thing is that we've still got a lot of support from third-party. We've got quite a big release schedule for third-party support on GameCube. Looking back historically, this Christmas we've got as many titles as we've had at any other time. Unfortunately, we haven't got Zelda, and maybe some of the other titles may not compensate for that, but we're still confident that with what we've got, it'll be a quite good Christmas.What about the retail side this Christmas? Last Christmas you had an upside because of the Xbox and PS2 hardware shortage which pushed GameCube to the front of the stores - is there a concern that this year, assuming no such shortages and given the arrival of Xbox 360, you could be pushed further into the back of stores?
We are realistic in terms of the fact that retailers have only got a finite amount of space. The combination with GameCube, DS, Micro, PSP coming, Xbox 360, PS2... I mean, space is tough. I know of some retailers who have cut space back on other formats, because they just feel that it's not their demographic, or not doing as well, not getting support.
It's a battle for everyone, shop-floor space, and we just have to do the best with what space we've got. We get a really good return on investment on the space that is utilised.You've got several titles coming out this year - Electroplankton and Nintendogs being the obvious ones - which are aimed at markets well outside the traditional gamer demographic. How do you market games to those people, and get the message out to them that there's something in this space that they should be really interested in?
It's quite interesting, because we're not neglecting our existing core audience, and we see these areas as being areas for expansion. We have to look at different targeting. We've got a really good marketing team, and with our media agency, we're still looking at different areas - for example, with say Game Boy Micro, we're looking at fashion magazines like Vogue, where we wouldn't normally advertise.
With Nintendogs, a lot of our sampling has been at dog shows and things like that. We have got a major promotion with the biggest dry pet food in the UK - there are one and a half million packs of dog food going out there with Nintendogs written on them, so that endorsement is there. I suppose Nintendogs is quite... I wouldn't say quite easy, but there are a lot of people that love dogs and we can easily identify those and focus on them.
But we're doing some other areas of media that we haven't maybe done before. On our mainstream TV advertising, we've been very successful with Channel 4 in our comedy sponsorship. We've had huge reach there, and we'll continue that with Nintendogs. That's getting to different people, because there's a wide range of programs they have - there's a program coming on Channel 4 called "It's Me or the Dog" and we'll be focusing Nintendogs on that as well, so that will reach a lot of different people.
Electroplankton and Brain Training, which are coming in the future - we're going to be looking at a lot of different places to promote those as well. Those are challenges that our marketing team will have to face. The response in Japan has been fantastic to those products - especially Brain Training, which has actually shown growth into older markets.Mentioning the Brain Training products - there have been a number of those "non-games" products released in Japan which have proven very successful. Are we going to see all of those in Europe shortly?
Yes, we will do. We don't have any timing on that just yet. We're still evaluating them - people have been trialling them in our European office, because you always have to check how things relate, and the response has been fantastic. Everyone's keen to market them here, and we've had a lot of people asking questions about them and showing a lot of interest. We think they're really positive.David Yarnton, thank you.
David Yarnton is the general manager of Nintendo UK. Interview by Rob Fahey.