Electric Shadow

A China-Sized Door Opens for Nintendo

This is the biggest news on the business side of console gaming in 13 years, ever since consoles were banned in China back in 2000.

Consoles such as the Wii U and Sony Corp.’s PlayStation were banned under a 2000 rule to protect youths from the perceived corrupting influence of video games. Nintendo’s prospects for meeting its sales and profit forecasts this year depend on winning sales amid new devices from Sony and Microsoft Corp. released in the past two months.

“Nintendo has to explore markets in Asia, including China, in order to increase its sales and profit,” said Tomoaki Kawasaki, an analyst at Iwai Cosmo Holdings Inc. in Tokyo. “China is a promising market, even though there is a risk games will be pirated.”

In the same way Western companies like Google/Android (and to an extent Microsoft) have had trouble making nice with Chinese censorship laws, I can see some issues for both Microsoft and even Sony that won't be as big an impediment for Nintendo. I have a feeling Nintendo will be quicker to integrate Weibo and Weixin (WeChat) than Sony or Microsoft, for example.

XBox One's Kinect integration, along with the wild west that is XBox Live, pair for a very significant pair of stumbling blocks to get past, but they'll surmount them. Microsoft has doubled down investing in-country:

Microsoft and BesTV New Media Co., a subsidiary of Shanghai Media Group, in September said they formed a $79 million gaming venture to take advantage of the new rules.

The violent and extreme content of many of the Xbox's most popular games may make things more difficult, to be honest, and their draconian standards for banning and bricking consoles remotely due to suspected piracy won't go over well.

Sony's past security issues with PSN accounts might be a difficult trust issue with Chinese consumers. That Sony is an Eastern company more accustomed to dealing with strict and sometimes odd censorship laws will help them, as will the less CCTV-ish features of the PS4 as compared to Xbox. Their stronger Asian developer/publisher gives Sony a major lead with content from genre that traditionally appeal more to Chinese and Japanese gamers.

Though diminished over the last generation, Nintendo's characters carry a great deal more embedded brand value with dedicated game players and especially kids. This is especially true of Eastern players who are not as First Person Shooter-obsesssed and whose lives revolve around their mobile phones more than in the West. The re-opening of the Chinese market, more than any single event this decade, convinces me that Nintendo will revisit their cell phone gaming strategy, but not in the manner that some have insisted that they should.

Like Apple and Amazon in their own respects, Nintendo does things a certain way for long-held business and design principles, no matter what John Gruber thought (with followup) last September, and for the exact reasons that he was soundly rebuked by John Siracusa. Nintendo's signature games rely on end-to-end design planning that includes Nintendo controlling the physical control scheme. They are still and will probably always be a conservative 100-year-old company run by 100-year-old men.

A Nintendo phone is not a crazy proposition, but it'll be done their own unique way if it were to happen. I just hope it isn't called Wii Phone U.