IR Information

2012 E3 Analyst Q & A Session - June 6, 2012
Q & A

Q 4-1

I understand why you concentrated on games at E3, but I have a big question about your online business. How will Nintendo differentiate, catch up to, surpass and compete with the existing vendors and open conversion platforms like iOS and Android? I really want to know more about that: multiplayer, marketplace and connectivity.

A 4-1


Nintendo’s strength in this area is that we have so many consumers all around the world who are familiar with our franchises and our software. And parents and grandparents view our products as good products to buy for their children and grandchildren without any concerns. We also think that it’s important that in such an environment, skilled game players and beginners are able to play together, and in a way that both parties come out with smiles on their faces.

On the other hand, though, I think that what we see in terms of online gaming networks on existing dedicated gaming platforms is not particularly well suited to the approach Nintendo has taken. Therefore, I can’t sit here and say to you that we can very quickly overcome or catch up to other companies, which began to work in the online field from many years ago and have been building these online networks on other platforms, and I don’t think that would be a smart strategy, either. We have been discussing what to do next under these circumstances and “Miiverse,” which I told you about in the pre-E3 Nintendo Direct presentation, is one of the new directions that Nintendo will be taking. We think that one fun area of possibility, as we have discussed, is for people not just to enjoy the games but also communicate with others about topics relating to the games. Even if they are in distant locations and not playing together in the same place or at the same time, they have an opportunity to “empathize” with one another. And we believe that the Mii characters that were born on the Wii console will become an important asset in achieving this.

We also believe that the “Miiverse” will serve the purpose of giving people an opportunity to discover other games that they haven’t yet started playing. In the “Miiverse” screen that appeared in Nintendo Direct, there were many Mii characters gathering around game icons, which I referred to as “Wara-wara,” and these icons will not be limited to only games that an individual consumer owns. We want to use this screen to show users who are satisfied by playing certain games that there is a high likelihood that they will also be interested in some other games that users are playing. In other words, please think that we have built an integrated recommendation engine into the Wii U system’s main menu screen. For the more casual users who do not play games frequently, they are less likely to go out and seek information about new games on their own accord. Therefore, we felt we needed a new way to try to reach out to them directly by helping them see what a suitable offering for them might be. Having said that, we would like the “Miiverse” to help users to enjoy games more, be a place for games that don’t have online play functions to still have an online network connection and become a tool for us to increase the tie ratio (the proportion of software sales units per hardware) for the hardware system.

Q 4-2 Without Friend Codes, can consumers be connected easier than now?
A 4-2


We’re not completely getting rid of Friend Codes, but a function of the “Miiverse” will simplify the process of making friends with another user in the platform by eliminating the need to input Friend Codes.

Q 5-1

On Wii U, can you talk a little bit from a technical standpoint in terms of the new business models such as micro transactions and subscription services? From a cross-platform standpoint, what are you thinking about for its capability like “Miiverse”? Do you think the Wii U will be an open platform to be connected with, for example, iPads, iPhones or Android phones?

A 5-1


With respect to the Wii U system, when we began working on it, one of our goals was to have a variety of purchase options and additional e-commerce options available at its launch. And because of that, we have prepared a Digital Rights Management system. We have designed the system from a technical standpoint to allow developers to freely take advantage of things like free to play and micro transactions.

The next question is about the multiple or cross-platform capabilities of “Miiverse.” Before we announced “Miiverse,” we announced the existence of “Nintendo Network” and positioned that as an overarching network to which different Nintendo hardware systems would be able to integrate. Within the “Nintendo Network,” the “Miiverse” will serve as that social connection between players. And as a result, we do intend to support “Miiverse” on our existing platforms as well as on future Nintendo platforms. As we introduced in the video that talked about “Miiverse,” the system itself is obviously designed to serve as that social connection for the gaming content to be enjoyed on Nintendo’s gaming systems. But at the same time, this “Miiverse” system is a web-based system, and you will therefore be able to access the “Miiverse” and see what is happening there from any device with an Internet browser. Because of this, you would then in theory have the ability to, when you’re not in front of the game system, be able to see the interaction that players are having by checking the content of “Miiverse” on a device like a smartphone or a tablet device. And that could become an opportunity for you to learn about a game that you may not have otherwise known about. Furthermore, for example, our goal is that, in the future, you will also be able to purchase games found in the “Miiverse” from that smartphone or tablet device and, by the time you arrive home, that game will already have arrived on your Wii U system through SpotPass.

On the other hand, we put the utmost priority on creating games as interactive entertainment with premium value and on asking the world to appreciate their value. So we are not considering making Nintendo-made games available for play on smartphones or tablet devices.

Q 5-2

At the launch of the Wii U, how many of these first-party and third-party titles will be available in a digital download format?

A 5-2


As we’ve shared with you previously, for the Wii U hardware system, from the beginning, we’ve planned to make it possible for people to release their games as either an optical disc or as digital content. So publishers would be able to choose from both of those options.

Currently, we are in discussions with the publishers by sharing with them our offer in this area. Through that process, if publishers accept it as reasonable, games in the digital format will be available from the launch time. There are no technical restrictions.


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