Nintendo speaks about its future

We chat with Peter MacDougall, executive vice president of sales and marketing at Nintendo of America, to get the company's thoughts on the current state of the GameCube and the Game Boy Advance.

The past few months have certainly been an interesting time in the video game industry. PC software-giant Microsoft threw its hat into the ring, two major consoles launched within a week of each other, and companies have been scrambling to put their online plans into motion. Though each company is facing its own set of problems, Nintendo has been put in a precarious position, as GameCube owners have been forced to sit through a software drought not unlike the one that occurred in the early days of the Nintendo 64. But Peter MacDougall, executive vice president of sales and marketing at Nintendo of America, is quick to point out that this drought is far less worse than the Nintendo 64's. "There is already an ample supply of games for every game taste--more than 30 on the market already, 50 by the end of June, and more than 100 by year end," said MacDougall. "By comparison, we had 10 games available for Nintendo 64 at this point in the system's life cycle. The market has never run on who has the most games people don't want to buy, but who has the most they really want."

Nintendo has every reason to have such a philosophy. According to MacDougall, Nintendo sold virtually every GameCube that shipped to retailers. But even though the GameCube has been selling well, both the PlayStation 2 and the Xbox put up impressive sales numbers over the holiday season in North America, causing many to think that Nintendo would have to rethink its strategy in order to overtake either company and seize the number one position in hardware. But Nintendo still maintains that it's not in direct competition with Sony's PlayStation 2 or Microsoft's Xbox, because those systems appeal to a different crowd--though the company still seems to keep an eye out for sales figures on those systems. "It was not a surprise that all the hardware manufacturers did well in the US this past holiday season. Our industry is very hot right now," said MacDougall. "But we don't know exactly what Microsoft has sold worldwide. What is their sell-through to date in Europe and Japan? In any case, they are apparently in a battle with Sony to control the transmission of data into, through, and out of the home. We're a little more down to earth--we just want to continue making great games."

Some--at least members of the media--would argue that Nintendo needs to take a new approach with the press if it wants the GameCube to edge past the Xbox and the PlayStation 2 in the minds of the consumer. Currently, Nintendo makes special debug units--which are capable of playing preproduction copies of games--available only to developers, making it difficult for the press to provide coverage on games that people are curious about. But Nintendo's reasons for barring the press from securing these units is reasonable--it doesn't want to open new avenues to software pirates. "Our relationships with the media are very important," said MacDougall. "However, we are very protective of our intellectual properties and have procedures in place to ensure security. Nintendo and other entertainment companies lose billions of dollars each year to piracy." Still, the company knows that it needs to find a way to compensate for this problem. "We recognize there are ways to improve media access to early game code and are working on systems to better suit reporters' needs," MacDougall added.

In spite of the current drought of GameCube software from Nintendo and other third-party developers, there will be a flood of software in the next several months. Nintendo still plans on releasing Mario in August, Star Fox and Metroid in the fall, followed by Zelda, and the company doesn't foresee any particular problems with launching so many high-profile games within such a short period of time. But at the same time, Nintendo's Shigeru Miyamoto commented in a recent interview with GameSpot that the company is currently evaluating games like Doshin the Giant and Animal Leader for the North American market, leading many to believe that the company is somewhat desperate to get games out onto store shelves as quickly as possible. Peter MacDougall simply sees this speculation as a case of people unwilling to embrace new or original ideas. "Similar conjecture was voiced when we released Pokémon in the United States, and that seemed to do all right," MacDougall said. "We understand that some observers are challenged by new concepts, anything that deviates from the norm, but that won't deter our quest for innovation."

While there are some lingering questions surrounding Nintendo's strategy for the GameCube, the company can almost do no wrong with its other platform, the Game Boy Advance. The system continues to top the charts as the number-one-selling piece of hardware, and according to Nintendo, that success brought about the price drop much quicker than initially expected. "With the incredible launch success of Game Boy Advance around the world, we realized component price savings earlier than expected, and there was no reason not to pass that saving along to our players," MacDougall said. "Since the price drop, sales have exploded for Game Boy Advance. It's leading the market in hardware sales right now."

Of course, one of the most consistent complaints about the Game Boy Advance is its dark screen, which has seemingly become less of an issue as developers come to grips with the system. But those waiting for a backlit version of the Game Boy Advance are going to be waiting for a while, because Nintendo still doesn't see a backlit Game Boy Advance as being a viable product for the handheld market right now. According to MacDougall, a backlit version of the Game Boy Advance is unlikely, and "the resulting depletion in battery life could cause serious repercussions." Another complaint among some Game Boy Advance owners is the decided lack of original games coming from Nintendo--quite a few of Nintendo's Game Boy Advance offerings have simply been rehashes or direct ports of various franchises. However, MacDougall mentioned that Nintendo would have a few announcements at this year's E3 regarding original Game Boy Advance content. But regardless of any problems the Game Boy Advance may have, it's clear that Nintendo sees it as an important key to its overall strategy. "Who would have predicted the incredible success of Game Boy 13 years ago?" said MacDougall. "We're extremely excited about Game Boy Advance and have aggressive plans. At this point, we are projecting sales of 25 million hardware systems in North America alone."

As interesting as the past few months have been, the unthinkable happened just a few weeks ago when Square announced that it plans to develop games for both the GameCube and the Game Boy Advance. There are some who think this was the crucial turn in events that would help catapult the GameCube into the number one spot in hardware sales, but regardless of anyone's views on the issue, it can only help Nintendo. "Mr. Yamauchi formed the Fund Q last year to spur game development for Nintendo platforms. In this instance, Mr. Yamauchi was impressed with the fact that a talented developer from Square was interested in taking on the challenge of creating a new form of game entertainment and decided to comply with his request," MacDougall said when addressing the new company--Game Designer Studio--that will be responsible for creating these games. "He's providing funding for the new game studio from this new fund." Unfortunately, Nintendo is still pretty tight-lipped on the issue, and MacDougall would only mention that the Square game will feature some sort of connectivity between the Game Boy Advance and GameCube versions. However, it has been confirmed that a version of Square's Final Fantasy Tactics is in development for the Game Boy Advance and that development actually started well before the events leading up to the Fund Q announcement.

The next several months will be crucial for the GameCube as Nintendo starts to release some of the key games in its lineup.

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