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Not-So-Super Mario |
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Thu Dec 25,12:00 AM ET |
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By Mike Musgrove, Washington Post Staff Writer
For owners of the Nintendo (news - web sites) GameCube, new offerings from the video game company can sometimes have a familiar feel.
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Right now, the company's trademark Mario character is featured in another racing game, another golf game and the fifth in a series of party games with his name attached (do all plumbers have so much leisure time?). The Pokemon have moved on from competitions in the "Stadium"; now they will face each other in a "Colosseum." Details on yet another new Zelda game are sketchy at this point, but it appears that players will be spending at least some time poking through cartoony castles looking for magic crystals -- surely there's a princess in need of rescue around here somewhere.
The video game world may have changed much over the GameCube's two-year lifespan, but mostly not because of Nintendo. Competitors Sony and Microsoft have taken video gaming online, turned their game consoles into karaoke machines and developed ways to allow gamers to insert digital likenesses of themselves in an effort to win new audiences. Nintendo, meanwhile, has stuck to a philosophy that people who buy and play video games enjoy the familiar and care little for such gimmickry.
At the industry's main trade show this year, Nintendo executives "talked about how they wanted to be cutting edge and create great new games," said P.J. McNealy, an analyst at American Technology Review. "Then they rolled out a new version of Pac Man, which is about as old school as it gets, besides maybe Pong."
The lack of new offerings has some analysts wondering if the once-dominant Japanese company may be waning, the next Sega, consigned to make video games instead of selling the machines that play them.
Tried-and-true titles from Nintendo are still selling, but they are seeing diminishing returns. The most recent game in the company's popular Zelda series, called The Wind Waker, was one of the year's best-selling games. Since it became available in March, 1.3 million units have sold to date, according to research firm NPD. Not bad, but the 1998 release in the series, called Occarina of Time, sold more than 2 million copies in less than two months for Nintendo's last console, the Nintendo 64.
After a year of mostly lackluster sales for the GameCube console (save a recent spurt following a recent price cut) and declining support from game developers, it looks as though Nintendo may have miscalculated. In the United States and Europe, the $99 GameCube is No. 3 in sales, behind Sony's $180 PlayStation 2 and the similarly priced Xbox. In Japan, the GameCube is No. 2, behind PlayStation. The actual numbers are more telling; Sony has sold about 60 million PlayStation 2s around the globe so far, compared with roughly 10 million each for Nintendo and Microsoft.
"It's like a home run contest between Barry Bonds, you and me," joked Michael Pachter, an analyst at Wedbush Morgan Securities Inc. who follows the video game industry. "He'll hit 70 and you and I will hit zero. Or one."
Nintendo was not always an also-ran. During the last round of console wars, it and Sony were power players who squeezed out a third, smaller competitor. Sega, an established game veteran, eventually decided to pursue the higher-margin business of designing games, not building the hardware they run on.
Sega's lesson was that even the major players in this industry can only afford a couple of pricey missteps.
"The GameCube is teetering on the edge of whether they should stay in this business or not," said Jay Srivatsa, principal analyst at research firm iSuppli. "You can't be just teetering around in this market."
Nintendo maintains that it is staying in the business and will make a stronger play when it releases the next generation of GameCube. Sony's PlayStation 2 built its dominance by offering a new console in 2000, "a year ahead of us," said Beth Llewelyn, director of public relations for Nintendo. "We're not going to be in that position next time."
Sony also made a clever move in allowing games designed for the original PlayStation to be playable on the PlayStation 2 -- a compelling argument for gamers who, at $50 a game, may have spent hundreds of dollars amassing a library for the PlayStation 2's predecessor. The GameCube cannot play Nintendo video games made for older-model machines.
Nintendo's ace in the hole this time out was supposed to be its ability to leverage its dominance in the handheld gaming market. With its Game Boy Advance, which has sold 42 million units worldwide, Nintendo essentially owns a massive market that the other console makers haven't touched yet.
Nintendo designed the Game Boy Advance so that it could be plugged into the GameCube and used as a controller. The company proclaimed that the Game Boy Advance would be a "Trojan horse" for the GameCube -- but that Trojan horse never opened because very few game designers have figured out cool ways to take advantage of that connectivity.
"There hasn't been a huge killer app yet," admitted Llewelyn, the Nintendo spokeswoman. As for that other type of connectivity, online gaming, Nintendo has expressed little interest in the concept. "We don't see it as a hugely viable business," she said.
Nintendo has focused many of its titles on the preteen and teenage gamer. By contrast, Xbox, often seen as the cutting-edge choice for older gamers, is offering a slick online service for players who want to go head to head over the Internet, and has consequently won a following that is an unlikely mix of grownup geeks and hip-hop fans. Actor Jack Black and rapper Method Man have given the Xbox rave reviews; rapper 50 Cent gave the console a shout-out in one of his songs and Sean "P. Diddy" Combs recently signed on to do some commercials.
Xbox's online game offerings are "the hip thing in gaming right now," said John Davison, editor of Electronic Gaming Monthly.
Nintendo has not divulged any news about what's next; the expectation in the industry is that the console makers will start to share some news about the next generation of video game hardware at the annual Electronic Entertainment Expo trade show in Los Angeles next spring. Conventional wisdom has it that 2005 will be the year the next wave of consoles hits the markets, though some have speculated that Sony might decide to squeeze another year of life out of the PlayStation 2 -- consoles are expensive to develop, after all -- and opt for 2006.
Game magazine editor Davison said the smartest thing for Nintendo to do would be to "circle the wagons" on the handheld market and give up the console market, a thought other analysts share. Sony is developing a handheld gaming device of its own, due out late next year, and if it ever dominates that market as it dominates the console market, it could be game over for Nintendo, the analysts said.
No one is counting Nintendo out yet.
"They can certainly recover in the next generation," said Brian O'Rourke, senior analyst at Instat MDR. "But the game console market might be starting to move beyond what Nintendo can deliver."
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