Monday, April 23, 2007

Last year: Nintendo, who? This year: Nintendo, wow!

A year ago in the world of video games it was Nintendo who? This year it is Nintendo, wow!

A year ago the Japanese company's new game console's name (Wii, pronounced we) was laughable. Today the console is flying off store shelves almost as quickly as the company can produce them. And the buzz about the Wii has overshadowed the even greater success Nintendo has had with the Nintendo DS, a portable game player that still is selling briskly more than two years after its introduction.

Nintendo's surprising turnaround is prompting broader changes throughout the industry as game makers that were caught off-guard by Nintendo's strength -- including powerhouses such as Electronic Arts, the world's largest publisher of games -- hurry to development games that take better advantage of Nintendo hardware.

"I would say that this time last year, people were underestimating or discounting us pretty universally throughout the industry," says George Harrison, senior vice president of marketing for Nintendo's U.S. division.

But since going on sale in November, the Wii has become the hottest-selling product among the latest generation of game consoles designed to hook up to TV sets, a group that also includes Sony's PlayStation 3 and Microsoft's Xbox 360.

Nintendo's strength underscores how transitions to new generations of game consoles, which occur every five years or so, can shake up the balance.

Nintendo dominated the industry during the 1980s and early 1990s, with hardware such as the Nintendo Entertainment System and iconic game characters such as Donkey Kong and Mario Brothers. But the company, founded more than 100 years ago as a maker of traditional Japanese playing cards, eventually lost its leadership in consoles to rivals.

At EA, executives concede that Nintendo sold more consoles than expected.

"Luckily for us, because of our scale and scope, we've got the ability to adjust pretty quickly and deploy some additional development teams," said Executive Chairman Lawrence Probst in a February interview.

It isn't clear how durable Nintendo's momentum will be. An array of titles coming this year based on blockbuster game franchises, including Take-Two Interactive Software's Grand Theft Auto IV and Microsoft's Halo 3, could give big boosts to the Sony and Microsoft machines.

0 comments: