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2011 E3 Expo Analyst Q & A Session - June 8, 2011
Q & A
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Q 4-1   What about other third-party publishers beyond Electronic Arts Inc. which joined you during the Nintendo's E3 Presentation? And, in addition, what are you planning to do to entice these top titles to come to your platform?
A 4-1


  There are, of course, a variety of genres within the video game arena, but perhaps one of the most popular, particularly in the West, is the First-Person Shooter and that is a genre in which people feel that the experience is greatly intensified by enhanced visuals.

  Within the current environment, there are a number of the companies that are spending a significant amount to create these First-Person Shooters but, with the graphics capabilities of the Wii hardware, we have not been able to get them to create Wii versions of key franchises, and they have developed few games of that genre with Wii as the primary gaming console.

  So, some of the hardware limitations that have been a hurdle for those developers to create their games on our console, are going to melt away when we move to Wii U because it is an HD system.

  And, I think that as we've shown the concept behind Wii U system, many of those large third-party publishers are showing great interest in what we have to offer.

  We were fortunate enough to have Electronic Arts Inc. appear on stage with us yesterday, but beyond that, we also had individuals who didn't appear on stage but did appear in the developer video in which we showed (at our presentation) both developers as well as executives from many of those third-party companies talking about the possibilities of the Wii U system.

  So, I feel that we will have an opportunity and we will be able to bring many of those key franchises to Wii U as a result of the work that we've done so far.

  And, within those efforts, if we do find a third-party publisher who is interested in taking advantage of the unique functionality of our new controller and styling the games that they are creating to take advantage of that, I think that's where we'll see the opportunity for Nintendo to cooperate with them. So, I think it would be safe to say that you can expect there to be more opportunities for those games to come to Nintendo platforms in the future.

(Note) In the evening of the day when this Analyst Q&A Session was held, the Developer Roundtable, hosted by Nintendo, was held and Ubisoft Entertainment S.A. made a presentation describing its engagement for Wii U. In our view, this is one of the examples of how third-party publishers are engaging in Wii U.

Q 4-2   When you say cooperate, do you mean that you will subsidize their development?
A 4-2


  There are a variety of different ways that we can cooperate with the third parties. There are some where we can offer them support or where we can divide up some responsibilities and cooperate in that sense. There is also the ability to cooperate from the marketing standpoint. So, there are a lot of different ways that we can cooperate with the third parties.

Q 5   In the slide that you showed us, you showed the console market excluding Nintendo declining on a cycle-over-cycle basis. So, I am wondering what level of confidence you have that the next-generation Wii is growth cyclical and not just cyclical, particularly as a lot of the markets start to get saturated and as we've got new game-playing devices coming into market. I know you talked about some of the innovations that will help you to reach new customers and so forth that you don't have already but, at the same time, the other consoles were innovative and still declined cycle-over-cycle. So again, do you think the Wii U will be growth cyclical or just cyclical?
A 5


  It really comes down to some of the points that I mentioned before. But first, when we created the console itself, one of the key things that we looked at was how we could make it a console that would be relevant for people who, so far, have not engaged in gaming, and that is an area where we feel that there is an opportunity to continue to expand the audience. Second, we are looking to focus on those individuals who desire high-quality visuals and meet their needs while, at the same time, offer new styles of gameplay that they haven't experienced before with the new controller. So, from those standpoints, I feel that there is a tremendous opportunity to appeal to that audience as well. Of course, I understand that it will not be easy for the new console to surpass Wii in sales. But we do believe that this is a challenge that we can take head-on, and if we didn't believe that, then we wouldn't be proposing this style of new system.

Q 6   Regarding online experiences, what are you thinking? Whether it's VoIP*, social or open approaches, what are you planning for your online approach?
(*) VoIP = Voice over Internet Protocol: Transmission technologies for the delivery of voice communications.
A 6


  To start, I'll have to say that I don't have any materials with me today that can illustrate precisely what our online environment will be like, but I can speak generally about the direction that we are moving in.

  I think, in general, the online environment is changing quite rapidly.

  So, what I have come to feel lately is that the idea of saying, "we are going to create this style of online structure and that we would like you, the developers, to fit into the online structure that we are creating" is perhaps already out-of-date.

  I think that Nintendo's past console business has often included this idea of a set and fixed online structure. So, I think that, going forward, the question is really to what degree Nintendo can create a more flexible system for its consoles.

  And, what we found at this point is that, as we discuss the online structure with different publishers, the things that the different publishers want to do are in fact seemingly rather different.

  Our current direction is how we can take the desires of the third parties and create a system that's flexible enough to enable them to do the types of things that they might want to do.

  So, for example with the question of VoIP, I think then what we would like to do is work with them on how to enable them to do that. But, what we're not going to do is to consider as prerequisite conditions that every game includes features like that because obviously there are some developers who may not want to do that.

  As for social networks, after examining the penetration and adoption rate of social networking services like Facebook, etc., we've come to the conclusion that we are no longer in a period where we cannot have any connection at all with social networking services.

  Rather, I think we've come to an era where it's important to consider how the social graph of the social networking services can work in conjunction with something like a video game platform.

  So, once we get to a point where we're able to talk more concretely about our online plans, I think that once you hear what we'll have to say, you'll feel that Nintendo has a policy of adapting itself to changes in the network environment in a flexible fashion rather than the one of sticking to a rigid mechanism, or perhaps you'll notice that we have found ways to take advantage of these types of features like VoIP and social networking, where our systems have been seen as being weak in the past. However, unfortunately, we won't be able to share anything concrete today.

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