Nintendo: Selling $50-$60 games 'challenging'

Iwata says it is difficult to meet consumer expectations for packaged software, will focus on making games with greatest sales potential.

Software development is becoming increasingly difficult, according to Nintendo. President Satoru Iwata told investors as part of the company's latest earnings briefing that selling titles for $50-$60 has been a "challenge" for the Mario and Zelda developer.

"These days it is becoming increasingly challenging to determine the minimum development resources required for customer satisfaction. The point I am trying to get across is that currently it is more challenging to sell packaged software for around $50-$60," Iwata said.

To combat this difficulty, Iwata pointed to digital games in "other formats." Still, he acknowledged that satisfying customers with a $50-$60 product has been no easy task, and breaking even requires millions of units to be sold across the world.

"It is true that it is becoming increasingly challenging to meet the expectations of consumers who are willing to pay $50-$60 for a game, and it is difficult to break even unless a huge number of units is sold all over the world, so it cannot be denied that software development is becoming more challenging," Iwata said.

A silver lining, Iwata explained, is that such games have a higher sales potential than ever before, thanks to the growing gamer userbase.

"Among such packaged software, however, the sales of popular games are much larger than in the past. Therefore, if we create more hit games, the software development business can still be very profitable," he said. "All games break even if they sell millions of copies worldwide, so we will continue to do our best to develop games which have high sales potential."

Written By

Eddie Makuch is a news editor at GameSpot, and would like to see the Whalers return to Hartford.

Discussion

354 comments
Devil_wings00
Devil_wings00

I'm just glad that one company is actually thinking about customer satisfaction. It also involve profits but it's nice to hear it come up as a priority. Whenever you get the inside scoop on people like EA it always seems like generating as much cash as possible with good marketing/micro-transactions is the goal not making a satisfying end user experience.  

Downloadpilot
Downloadpilot

"... so we will continue to do our best to develop games which have high sales potential."

In other words, more Mario and Zelda? :/

MGSFAN612
MGSFAN612

Well what do you expect when you are stuck releasing games from the same franchises for nearly 30 years.

theR34p3R
theR34p3R

The problem isn't the price itself so much as what you get in return for it. When you pay a big price for a game, you'd expect to be wowed. Nothing less. Something that blows you away and ensures hours upon hours of gameplay and fun. Not some half finished, semi-prequel-copied piece of garbage. You expect that every service it makes you adhere to (the Simcity story) is fully functional at all times (or the better part thereof). Consumers want finished games and not the variety that come with (on-disc) DLC that is available from day 1.

The pricetag of a game should be fair (towards the consumers). Plain and simple. Investing a fortune in a game is the risc the developers take (or are made to take). If they don't deliver what hey promised, leave too much to chance or waste time and resources, they deserve all the flakk and criticism they receive from the community. The way too rapid advances in hardware technology are a big part of this problem too. More and more time has to be spend in facilitating all this new graphical power.

elancion
elancion

Nintendo are true trend setters . selling refurbished systems at a lower cost than games stop. challenging the industry to check themselves on over pricing games.

Say what you will about Mario and Zelda, but there is always something new and refreshing about those franchises from every new installment released (more than I can say about COD or gears of war along with many other sequels). plus no other company makes Zelda or Mario.

respect

Kano92
Kano92

Nintendo is to gaming what Nerf is to sports.

canadian_sharky
canadian_sharky

Well it's easy really. Insteand of re-making super mario world or ocarina of time for the 20th time, give us something like the first super mario world or ocarina of time were in their days: fresh, epic, gamer-friendly experiences that revolutioned the industry.

NaturallyEvil
NaturallyEvil

Part of the problem is also that Nintendo is very bull-headed about dropping the price once the game has been on the market for a while.  When Sony, Microsoft, and PC developers drop the price on a game a year or two after release, it helps to compete with the used game market, but more importantly it encourages more people to give the game a chance.  If these people really like the game they bought at $20, they might even be excited enough to buy the sequel at full price when it launches.

Instead, I often see Nintendo games sitting on the same shelf at the store for the entire life of the console, with a $50 price tag underneath collecting dust along with the game.

And while we're bitching about Nintendo, they also charge the same amount for the download of Monster Hunter 3 Ultimate that they charge for the retail disc.  What the hell?!

wheres_my_phone
wheres_my_phone

Also, if they can sell more games at a lower price, then they'd be able to make the same profit as with selling fewer games at a higher price. This way their customers would be happier, they'd sell more hardware, and it would be good for publicity tooーmore games sold means more free advertising and talk about Nintendo. But then again, "Meh, it's too expensive" seems good for business too, I suppose.

wheres_my_phone
wheres_my_phone

I dunno why they have to sell their games for 50 to 60 dollars. I'll buy a game new, but 60 dollars is really pushing it. Some places near where I live are selling Bioshock Infinite for like 70, 80 dollars for Xbox 360. Why would I pay that when I can get the PC version, which is better in this case, for 45 dollars?

They need to realize that some of their games are overpriced. Mario World U for 50 dollars? Come on!! Instead we just buy used games or games on another platform. I'm sure they'd sell way more games if they priced them around 30 to 40 dollars.

Nepti
Nepti

For all their current missteps, Nintendo is the one platform that offers more than just another FPS and is what I love about their consoles. There fixation on controllers frustrates me the most. A focus on controllers is not bad in and of itself, but Nintendo has elevated that focus above games - which is what video GAMING is all about - the games. The controllers are just what let you play. If Nintendo gets their priorities straight by putting games above controllers, it will take them a long way to getting back on track.

Vodoo
Vodoo

You'd have even more sales potential if you junked the Wii U and put your games on the Xbox & Playstation.

tionmedon
tionmedon

i am not paying $50.00 for a cartoon.............fap it.......

TheCyborgNinja
TheCyborgNinja

Does this mean even Nintendo will be making less games for the Wii U? Seriously?!

fumaleiar
fumaleiar

With everything that was mentioned in this article, nothing was mentioned about over payed executives and overly expensive development costs or unintelligible predictions on unit sales. $50- 60 is plenty of money for a mass produced product - I think they just need to cut down on costs by taking some of the money from the executives and giving it to the people who actually make the games. Second, stop trying to reach/expect COD-like sales figures (unless the game their making is actaully called Call of Duty) and spend money according to realistic sales predictions (Selling 3.5 million copies and still calling it a 'disappointment' - something tells somebody made an exaggerated prediction which led to overspending somewhere). DLC is not the key to making a game profitable - developing such a game around DLC is folly. Games bought should feel finished - while finishing them should feel satisfying from both gameplay and narrative perspectives. DLC should be a result of massive fan request, and not a business plan from the start. What devs today seem to don't know is that people expect a finished product once they boot up a game, not a work in progress. They should understand that the current market has removed their monopoly over gamers. Mobile gaming has given the masses a cheap answer to avoiding unsatisfying console releases. They should stop forcing people to accepting DRM and stop blaming second hand gaming for their losses. They should start spacing the release of their games, and not cram 2-3 of their 'AAA' titles all within the same quarter.

SixTwoOne
SixTwoOne

I have such a backlog, why would I ever pay full price... ESPECIALLY when the game is re-released as GOTY type version with all DLC and patches.  Before DLC (early 360 days), I always wanted to get non-greatest hits versions of games for my collection (normal color case, normal insert, etc)... now gun shy because they will release better version in 6 months.

BrahManDude
BrahManDude

all they sell is mini games of course it's pretty hard...now time to step it up Nintendo

Defender1978
Defender1978

I should be able to buy Super Mario Galaxy 2 for $20 at this point.  What gives?

kiramasaki
kiramasaki

They are still selling a 2-4 year old game in new super mario bros wii for 50. Zelda titles also have traditionally been kept at the highest prices possible till the end of a console. Nobody is forcing Nintendo to price games at those prices. So what exactly is their point?


DeanKnight
DeanKnight

Interesting that Nintendo is saying this.  I go to my local Wal-Mart and see 3 to 4 year old games made my Nintendo still going for $40 (DS games) and $60 (Wii games).  They don't drop their prices until it his the greatest hits collection.  I head to the bargain bin, and I'll see Xbox and PS games for $20 which are less than a year old.  Then again, the fact that Nintendo games are on the main shelves so long after release tells you of their quality and sales.

dre256x
dre256x

Simple solution, Lower the games to 45 dollars....

ChunkyDrawers
ChunkyDrawers

Agree with below games like Elder Scrolls, GTA, Fallout are worth release day price. Nintendo just make a Zelda Elder Scrolls style and you'd have the greatest selling game of  all time :P

shadowhunter0
shadowhunter0

of course it would be challenging for you guys since all you do is pretty much release the same games over and over with small changes

rasterror
rasterror

Then again I remember the Genisis and SNES days where it was common to pay $60-100 for a game.  I remember payin $70 for Madden and NBA Live, ~$80 for the Final Fantasy games, and $120 for Virtua Racing.  But back then I didn't have Gamefly but thank goodness I do now.

4321Rocket
4321Rocket

If its hard to make games for $50-$60 then reduce your price. Not like anyone will kill you.

rasterror
rasterror

Games like Elder's Scrolla and GTA are worth $60 because of the amoungt of game you get.  SMB Wii U, not so much.

tim1935
tim1935

So with only 100,000 Wii Us out there... they're boned.

kb8618
kb8618

There isn't a lot of games i buy on or near release, and sometimes i just rent it for a night and save my self over $60.  Even if i made double of what i do, most game just don't justify a $60 price tag

edinko
edinko

Its very easy today to wait for a big discount. GAmes today are very often very buggy on release with an avalanche of dlc rip offs. So no problem to wait few months  for the patched complete game at half the price or less.

bmart970
bmart970

It's really challenging when all you do is make new iterations of games over and over. Also, (especially in Nintendo's case) many gamers are more casual and are willing to wait for the price to drop on a game.

pcty
pcty

I don't think that a game quallity is direct related with a amount of "minimum development resources". Indie games keep showing us that small budget games can be fantastic even without absurd amounts of resources.

kbaily
kbaily

I hear that.  We really need to get more "mid range" games.  Good games in the $20-$30 range. Maybe not super long because right now we have our $60 AAA games and cheap ass mobile/facebook games and nothing in between unless it's used or a downloadable indie game.

Hurvl
Hurvl

I used to think 60 dollars in my currency was cheap, because full price PC retail games cost 76 dollars in Sweden, but then Steam came along. Now I never buy games at full price, I can wait for a Steam sale. My backlog also makes it possible for me to wait until the price drops to like 10 dollars or less.

arc_salvo
arc_salvo

@SixTwoOne Yeah seriously, same story here.  Too big of a backlog, plus if you just wait a little you get a better cheaper more complete version.

soulless4now
soulless4now

@Defender1978 The big N doesn't believe in price drops. They should include it in their player's choice game selection if that's still going on.  

Mkeegs79
Mkeegs79

@DeanKnight Exactly. There is many games I wanted by Nintendo that were 40 dollars for a ridiculous long time. Its cool to see someone that has noticed that too.

dre256x
dre256x

@shadowhunter0   Last i see the games that sells the most are sequels so can you blame them?  Assassin Creed, while an original IP Sold well but low and behole the Sequel sold 3x+ the first...  So while gamers love new IP, Sequels are the money makers for popular franchises.

kreegan64
kreegan64

 @4321Rocket 
How on earth will that help? If they need millions of units out to just break even at 50-60 then lowering the price will just make the break-even amount even higher. Lowering prices don't automatically mean a substantial amount more sales to make up for it.

bj91x
bj91x

Yep. With companies trying to milk more money from me (fake DLC, anti-used games, DRM, etc.), they inadvertantly made me spend less money on games.

Karma.

shadowhunter0
shadowhunter0

@Hurvl yeah I agree I have a backlog has well even on the vita but there are some games that you just have to have day one like Soul Sacrifice

Scorpion1813
Scorpion1813

@arc_salvo @SixTwoOne  

But if EVERYONE waits until the complete edition comes out, the developers wouldn't have the money to make those DLC's and patches. The sales from the game on first release are what support the developers to be able to, in turn, support the game with more content and bug fixes.

edinko
edinko

@bj91x Of course. THey don't understand it. They are blinded by greed. They want all peoples money yesterday

Scorpion1813
Scorpion1813

@Downloadpilot

It's hard to be able to fix EVERY single glitch before release, and the longer they delay the release of the game, the more it's going to cost. They can release the game and be fixing it while the game is being printed/shipped, or even after that whilst earning money from sales.

As for DLC, while some companies abuse the system, it is supposed to allow the developer to continue making and releasing content for the game to encourage people NOT to sell their copy. This in turn will mean less used games being sold as most people are keeping their copies.

This assures the companies are getting the money from sales of THEIR product, rather than the retailer getting 100% of it.

Anyway, there is no such thing as a "complete" game. There are ALWAYS features left ou of games that the developers don't have time to add before release. If they tried to add everything (just like Duke Nuken Forever tried to do) they will end up running out of money (just like Duke Nukem Forever did), and the developer will have to shut-down (just like the Duke Nukem Forever developers did, twice).

Downloadpilot
Downloadpilot

@Scorpion1813 @arc_salvo @SixTwoOne Yeah, but why don't the developers actually just COMPLETE the game so they don't need to add DLC for content that should've been in the game from the start, and patches for bugs that should've been fixed BEFORE release?

Surely you'd get better sales with a completed game and a more faithful fanbase--who are guaranteed to come back for the inevitable sequel--if you game them a reason to?

kreegan64
kreegan64

 @NosadaAssasin @ChunkyDrawers @rasterror Monopoly on gaming since there wasn't anything like steam at the time. Also the game cartridges were a rather pricey thing. If I can remember correctly, the N64 cartridges costed $25 to produce; add that with packaging, advertisement, etc. I imagine it was pretty common to see prices such as those.