Nintendo's point man in the console wars

When the rest of the video game industry zigs, Nintendo zags.

While competitors Sony and Microsoft were busy sketching brave new online worlds for their game consoles during last month's Electronic Entertainment Expo, Nintendo was sticking to "the here and now," as Peter Main, executive vice president of marketing for Nintendo America, put it.

That means the main selling points for the company's upcoming GameCube console won't be cutting-edge graphics and Internet connectivity, but price, family-friendly software, and the return of beloved Nintendo characters such as Mario and Pokemon.

Nintendo is counting on those factors--along with the upcoming Game Boy Advance, the next generation of the handheld gaming phenomenon--to keep pace in the increasingly competitive game hardware business.

Main spoke about the new challenges of the game business and Nintendo's competitive position during an interview with CNET News.com.

Q: It seems like Nintendo is being cast as the underdog in this round of the console wars. Does that feel odd, considering that Nintendo helped create this business?
A: I think we've suffered in profile the last couple of months by virtue of our decision not to say anything about what GameCube was. That led a lot of people to deduce we were not going to be players this round. And when we showed up (at E3) and unveiled not only a real product but some compelling, unique software, gamers of every interest were coming to the floor and saying, "Thank goodness."

Why the closed lips for so long?
We believe that gaming, not being one of life's necessities, tends to be an impulse purchase. You develop an interest in gaming and then decide you do want to spend the few hundred dollars for a console. We believe that decision is made in 60 to 90 days of making the purchase.

In the interim--while Microsoft had nothing else to do and Sony had the PS2 to push--we had a lot of N64 (consoles) to sell and Game Boy Color to sell. For that reason, we strongly urged our retailers to not even start talking about Game Boy Advance until the week after Easter...in preparation for a launch in mid-June. Likewise, we decided we were going to stay under the radar of the gaming public on Nintendo GameCube to continue interest in the existing product.

Any time you put a bona fide reason for delaying the purchase of one of these systems in front of the consumer, it hurts the market. I think coming out of this show, the noise about GameCube and Xbox is going to hurt PlayStation 2 sales for a while. I think an inordinate number of people will decide to wait and see what this is all about. That's not so good for the industry--but I can't say I'm feeling so bad for Sony being slowed down a little bit.

Any regrets about coming out on the market now instead of a year ago, when Dolphin (the original name for GameCube) was originally scheduled?
"You've got to get it right, and you've got to get the software right. Our announcements (of the on-sale dates) were not driven by questions about whether our hardware would or wouldn't be finished, but by (Chief Game Designer Shigeru) Miyamoto saying he was at an adequate point without software, both internally and second party, to go to market.

Now we're ready to go to battle. We'll be ahead of Microsoft in the Japanese market...and we'll be here duking it out with them in the U.S. from day one.

There seem to be a lot of different perspectives here on what a game console should do besides play games. What's Nintendo's position?
There (are) two entirely different camps. The camp occupied by Sony...and Microsoft is clearly one of future potential being marketed today. Our camp is, "Here is a unique, clean, developer- and gamer-friendly machine designed to play phenomenal software right now--and capable of growing into other applications tomorrow when and if they should be discovered as killer apps from both a consumer and a shareholder perspective."

Do those killer apps potentially include things like Web browsing and e-mail, such as Sony will offer through America Online?
We don't quite understand that. It's outside our focus; it doesn't seem to be a part of gaming. Gaming is about discretionary, disposable time and money. It doesn't have the overlay of multitasking. It's about dropping out in the same fashion you do at 8 o'clock when you turn on "Cheers." This is another form of that.

To suggest that kind of multipurpose activity--I guess it's the same high ground PCs went after when they said, "We're going to be the gamers' platform of choice because we can do all these other things." The consumer's already said that's not exactly the most exciting idea.

As far as online gaming, the idea for now seems to be a PC format where you buy a game and get a couple different versions of it, including one for playing over the Net. Is that a compelling proposition for Nintendo?
We don't think so. It certainly reflects innovation, but we do not yet see enhancement of the game-playing experience in that kind of product. It's the same-old, delivered in a different fashion. We're not sure it's adequately compelling. We're working very hard at this. We would not have put the 56K modem and broadband potential into the (GameCube) system if we did not think there was something about connecting with other players and downloading data. But we're being brutally honest in saying...that we have not seen the compelling advancements in game play from using that.

What I mean by that is last year, Pokemon, a ridiculously unusual gaming application...sold over 10 million pieces of software in the U.S. alone. Why did that happen? Not clever marketing--that was a whole new idea in gaming, finding, collecting, trading items. I think that shows this is clearly not just about chasing the potential of technology. It shows this is about finding creative ways to deal with the tried-and-true story lines of gaming. Our focus is on that kind of creativity as opposed to, "Here's what the hardware can do; what can we apply to that?"

With this new generation, the Game Boy and the console will be able to connect for the first time. Are you looking for the Game Boy's success to help drive console sales?
Absolutely there's a connection. The Game Boy franchise is clearly the strongest in the history of video gaming--120 million-plus pieces of hardware installed around the world...and a very excited consumer group that loves Game Boy and the type of gaming it represents. If we can show them compelling software for the GameCube that utilizes the Game Boy Advance and its functionality that they're very familiar with, I think that's a great lead-in.

Are you nervous at all about the handheld gaming market with cell phone games starting to catch on?
We're nervous about everything; we're a nervous company. Our starting point is that we're of the belief that nobody really needs us. We have to keep proving ourselves day after day. What we're seeing now is a variety of people trying to use the gaming business to differentiate what otherwise are becoming commodity products. Whether it's PDAs or cell phones or anything with a screen and digital capability, people see games as a way to add value.

We're watching (cell phones), but I think some key issues are being overlooked in addition to the obvious--namely the screen. We did not expand the screen size (of the Game Boy Advance) 50 percent just because we thought it was a nice idea. You need that kind of capability to play the bulk of genres of today's games--sports games, adventures.

Just as important...is the controller. The controller is really a critical part of this. In order to really enjoy gaming, you have to have intuitive control elements. For somebody to be so presumptuous to think they're going to get the consumer to figure out the keypad to control a game, they're really missing a fundamental aspect of what video gaming is.

What that means is you're going to see games that are pretty basic, pretty perfunctory in these environments. And that's reflective of people who don't really understand what the gaming business is all about.

Games are just a part of what Microsoft and Sony do, while for Nintendo it's your whole business. What do you think your competitors don't understand about the game business?
What's the shortcoming right now is the belief this is a numbers game--the more titles the better, the more developers the better. All the evidence one needs is in front of us to say that's wrong. It's...wrong in the form of absolutely killing the development community with failure after failure...We've already had a bloodbath; we've already seen a number of developers go out of business. And we've got hardware guys continuing to drive that.

What's even worse is we're driving a disappointment factor (into) consumers who have been voting by not buying out of disappointment with the quality of product being bought to market. I think if we all have an interest in this beyond tomorrow or a year from now, we want to be promoting stronger developers and even better consumer satisfaction.