Microsoft’s former chief Xbox officer Robbie Bach has reiterated that he “won’t ever count Nintendo out,” even after Wii U has failed to strike a chord with consumers.
“I’m one of the people that won’t ever count Nintendo out,” Bach admitted to Fortune. “During our development of Xbox 360 we focused pretty heavily on Sony and PlayStation 3 and the Wii was a complete surprise, so the first 18 months of our launch was a real challenge.”
It is well documented that Microsoft had disregarded Nintendo after the GameCube failed to strike success, only achieving 21.74 million hardware sales worldwide. That was in stark contrast to PlayStation 2, which sold more than 155 million units worldwide.
But with Wii, Nintendo struck success by introducing motion control – the Wii Remote removing the invisible barrier to entry for casual and first-time gamers. It has achieved more than 101.56 million units sold to date, however the Wii U has fallen far short in even coming close to such glory with just over 10 million unit sales since November 2012.
Nintendo’s main challenge is that, despite the smartphone market’s increasing dominance, much of their recent success is still being seen in the handheld market. While still not rivalling the Nintendo DS, the Nintendo 3DS has sold more than 53.07 million units worldwide since February 2011.
“That market has become a lot more challenging because of smartphones, and their Wii U console frankly hasn’t caught on as well as they would like,” Bach explains. “So you have a fabulous and amazing creative company that had incredible franchises, but doesn’t have a strong platform right now to develop for. That’s a tricky thing for them to navigate.
“They’re going to have to figure out either how to expand the number of platforms that they develop for, which would be a major change and would be risky, or they have to get into a cycle where their own Nintendo platforms evolve in a way that enables their games to get better coverage.”
Despite competition from Activision, Warner Bros. Interactive Entertainment and Disney Interactive, Nintendo’s move into the toys-to-life category is one strategy that hasn’t been matched by Sony or Microsoft.
“This does speak to something about Nintendo that’s different than Sony or Microsoft,” Bach closes. “Sony is a consumer electronics company and Microsoft is a digital PC electronics company. Nintendo — with great respect and pride — is a toy company, and always has been. That’s why their franchises on the game side are so powerful. There may be an opportunity there for them to invest in what is essentially a core attribute of what they do (toys), and it may create an opportunity for the company that’s unique and separates them from Microsoft and Sony.”