Following Aaron’s excellent commentary on Brian Caulfield’s article in Forbes, I thought I’d throw in my two cents on the whole subject.
It would be easy to just laugh off the suggestion that Apple could even dent Nintendo’s grasp of the hand held gaming space, but before I start chuckling let me play devil’s advocate for a moment.
Caulfield makes one really good point. Apple’s content delivery system through iTunes kicks anything Nintendo can offer out the window. Digital distribution is the future, and Apple is getting a great head start with the upcoming launch of the iPhone App Store. The ability to buy games directly from the iPhone is huge, and it’s easily the biggest thing Apple has going for them right now. More below.
Now for Nintendo’s side of the story. The Nintendo DS is the best selling hand held gaming platform worldwide. Ever. The thing prints money. It has a HUGE library of quality titles, and an even bigger library of crappy licensed games that people will buy out of ignorance. Like Aaron said, Nintendo sold more copies of Nintendogs then Apple has sold iPhones. Nintendo has an install base that can’t be beaten by anybody. If Sony couldn’t do it, Apple sure as heck can’t.
The clincher to this whole argument comes from another part of Caulfield’s article.
To be sure, the Nintendo DS won’t be an easy kill. First released in 2004, Nintendo freshened the design of the aging system in 2006, with the release of the thinner, lighter DS Lite. Yet developers continue to toil away on ever more sophisticated games for the aging DS…
The DS is 4 years old. I could buy that by an arcane alignment of the stars and a dozen stellar launch titles Apple hasn’t told anyone about the iPhone could put up a fight for hand held supremacy. Heck, if they released a version of World of Warcraft it might even outsell the DS. If that happened, and that’s a big if, all Nintendo has to do is announce that Nintendo DS 2 is coming out Christmas 2010. There. Game over. Nintendo can (and will if they’re not stupid) utilize their existing online components they released with the Wii and allow gamers to access virtual console titles for their DS. That alone gives Nintendo the punch they need to safely keep the iPhone where it is now: a luxury phone with a few cool features.
Don’t get me wrong, Apple can exist in that space and still make a lot of money. They don’t have to be the best hand held gaming platform, they just have to be the best cell phone with games included. It’s a big distinction. They can’t directly compete with device with buttons, but they can definitely give you the impression that you’re a smarter person for choosing to game on your phone rather then buying a system purely for gaming.
I posted a story yesterday quoting a CEO from a European software firm suggesting that Apple was going to pursue a 25-30 dollar price tag for their titles. That’s about ten bucks away from being a successful venture. I’m not going to pay 30 bucks for Spore Creature Creator when it comes free with the full game I can buy for 60 bucks for my PC. I think that in order to be successful they need to charge no more then twenty bucks for any of the games in the App Store. That’s 8-10 bucks more then anything I can buy on my Motorola, and still cheaper then what I pay for titles on my DS.
If they keep the 25 to 30ish price point I have no doubt their marketing department will sell enough games to make the launch a success. But. If they want to achieve the longevity and consumer interest it takes to continue to attract big name titles, they need to lower the price, and they need to do it quickly.
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