A portion of a Level Up interview with Satoru Iwata…
LU: When I spoke with Mr. Miyamoto at the Gaming Developers conference, and we talked about why it was third parties weren’t having as much success on the Nintendo platforms, and he said that he felt that a lot of third party publishers were putting their third and fourth string teams on Wii instead of their best teams. Is that anything that comes up in conversations when you talk to publishers about how you want them to support your platform, given that the DS is far and away the number one handheld, and the trend for Wii is that it’s going to overtake Xbox 360 globally?
SI: I believe that currently, the number of publishers who–or the feeling amongst publishers who want to put their best teams on Nintendo platforms and who want to make software for Nintendo platforms is the highest it’s been in, say, the last ten years. However, six months ago, you know, I don’t think the people out there were saying that Nintendo is done, they’re going to roll over and vanish, but at the same time, I don’t believe that there are too many people who thought we wouldn’t be where we’re at today. So I believe that a lot of people out there thought, “Okay, this is a fad. It’s not something that’s going to continue.”
That attitude is not something that’s going to change quickly. That, in addition to the fact that Nintendo was doing something that really kind of flew in the face of common industry practice and common industry knowledge. If you look at the common practices and the common way that games have gone in the industry in the past, it’s “Okay, we focus on the high teen market, that core market, and then we let them disseminate game knowledge or game popularity. The better-looking the game is, the higher quality the graphics, the more we’re going to sell.” That sort of pattern is something that Wii was not following, and again, because we took that different approach, it caught a lot of people by surprise.
During the E3 press conference, Reggie mentioned that half of all games sold on the Wii are from third parties. But when I spoke to him at GDC, that number was two-thirds. So if you look at the trend, Nintendo’s share is increasing and third parties’ share is decreasing. Now you have a business to run, so you’re trying to sell as much of your own software as possible. People are now starting to think now that perhaps the Wii isn’t going to be a fad, but looking at the history of Nintendo platforms and how third parties have done, what’s the number, what’s the percentage share that will make you start to worry about how the third parties will look at this, and maybe start to say “Well, maybe the opportunity’s not as good as it seemed,” and start to return to their previous way of thinking.