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Thunderstarter

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Nintendo's Plan of Disruption-The Downfall of Sony and Microsoft

My first REAL blog. Here it is!
 
  --(I've posted this blog on Gamespot already, but it's my favorite blog and in my opinion the best I've written so far)--

"OH NOEZ!!!" You yell at me, "HE'S GONNA BASH SONY AND MICROSOFT! WHAT A CASUAL NOOB! HARDCORZ ALL THE WAY!!!!!1111eleven".

Yeah. Settle down if you were really going to say that.

I have recently read a very well-researched and evidenced blog called "Birdmen and the Casual Fallacy". I read it just today and it was written in 2008.

You can read my condensed version, or you can read the entire article. In an effort to keep it shorter I may have lost a few points or left a few out. Here is the original article:

I swear, everything that was said in the article came true at E3 2010. That, or it is currently in the works.

Read the original article (it's lengthy) or read my condensed version and THEN read my comments at the end. Enjoy!

- http://malstrom.50webs.com/birdman.html


DISCLAIMER- What you're about to read is a condensed, bite-sized version of the blog I read. I take no credit for anything I say here. It belongs to Sean Malstrom. If I put something in quotation marks, it's from the blog (unless stated otherwise). My comments will be separated from this.

Part 1: Birdmen

"Centuries ago, men attempted to fly by putting wings on their arms and flapping really hard. Logically, in their minds, it should have worked. Birds fly. Birds have wings. Therefore, having wings should mean man will fly."

These men that tried to strap on wings and fly ultimately failed. They became the object of many cartoon parodies and pictures with funny captions on the internet. The descendants of these men are still with us today. Do you wish to know where they are? Right in our game industry. Who are they? Some of the highest acclaimed gaming executives, journalists and analysts.

"Nintendo is flying high. Rather than examine the nature of this flight, the birdmen are mesmerized by the feathers. The analysts and executives do not see the concepts of disruption and don't even understand the Blue Ocean principles (though they think they do). The feathers they see on Nintendo's ascent are casual games. Therefore, they surmise, if they make casual games then they will be flying high with Nintendo."

"There is nothing new here. Years ago, when Grand Theft Auto 3 hit big, all the birdmen began putting out Grand Theft Auto 3 clones. Years before that, it was first person shooters. More years before that, it was bloody fighters. One can find the birdmen back in the 8-bit generation making platformers. They would look at Super Mario Brothers and go, "Oh, I get it! We just need to make a game with cute music, colorful world, and upgrades like the magic mushroom!" Slapping wings on their arms, these games flopped. Amazingly, despite how many times the birdmen fall down, each generation they are ready to put on feathers and jump off a cliff."


PART 2: How the Casual Fallacy was Born

The game industry is distinctly hardcore. Every game developer, gamer, publisher, journalist etc. knows that. These "hardcore" gamers see more then an average person does in a game. They see heart, sophistication, magnificence, they see art (not Roger Ebert, though. He doesn't see art in games, apparently). In a casual game, this game sees simplicity, non-art, and easiness (in a sum, that is).

With that thesis in place, you could easily replace the word "casual" with retard Hardcore gamers see Casual games not as an advancement but a hindrance to the gaming industry. Because of the new definition of "casual" you can easily think of all casual games as retard games.

"Despite every company and their dog making these 'casual' games, the so-called casual audience is not buying them (just as they didn't buy the platformer clones of the 8-bit generation, the fighter clones of the 16-bit generation, the GTA clones of last generation, and so on). When seeing their 'casual games' flop while seeing Nintendo's 'casual' games in the bestsellers, the third parties growl and say, "IT IS ALL NINTENDO'S FAULT! People only buy Nintendo games! Third parties can't succeed on this platform!"

The problem is not in these companies' execution of their plan. The problem is their world-view. Their perception is totally off, and it is costing these companies millions upon millions of dollars. Don't you think, guys, that it is time to think about things a littler harder before you waste more millions?"

Part 3: The Casual Gamer is a Myth

"WAIT!" You yell from your computer screen, "How is that true? Look at all of the shovelware on the Wii and DS!"

Let's put this into perspective. Speakers. Yes, speakers. T.V. Speakers, computer speakers, pick one. Now, for speakers, the better the speaker, the more money it costs, right? The same goes for gaming. The better the game, the higher the price

"But wait!" You yell, "I found a new copy of Bioshock for $20!"

Let's keep the comparison going. Think of games as new "models" for a certain line of speakers. When the newer models come out (AKA newer games) the older models drop in price. The quality is the same, but the price is different.

Keep the speakers in your mind and think of "hardcore" games as upper-tier speakers and "casual" games as lower-tier speakers.

" "Well, knowledge is the defining characteristic of the tiers. The more knowledge one has, that means the more audiophile one is, the more likely he or she will reach for the upper tier. At the bottom, the users know little about audio and do not care to know. The ones at the top are very passionate about their audio and will pick out separate speakers and subwoofer just to maximize their experience."

Are you saying the people on the bottom tier are stupid? Are they just casual listeners?

"Only an upper tier person would define them as 'casual'. They just don't have that much passion about audio so they don't have much knowledge." "

HA!

Going back to games, what creates the passion for games?

By having the games they want to have.

Wouldn't a gamer who constantly buys the lower-tier games he wants be called "hardcore" after gaining knowledge of these games? What right do you have to tell them they aren't passionate about their critically panned games?

Part 4: The Upmarket and Downmarket

Basically, the Upmarket are games with a ton of features, but no so many that it gets overwhelming. The downmarket are those games that have little features or so many that it gets confusing. The ones who are at the peak of these upmarket games are called hardcore.

Part of Nintendo's plan involves introducing people to games slowly. Introduce games that have a good amount of features, but not nearly the amount that say, a Metroid game would have. That would scare them away. The game is good, but not a ****c. They use the upmarket in a unique way, meaning that they have a plan to slowly bring their players up into the peak of the upmarket, so when they sell those AAA titles they will get more money.

Part 5: The Upmarket

"
Today, what is considered an "8-bit game" would be considered a "casual game". Evidence of this is seen with 8-bit and 16-bit spiritual sequels emerging only on handhelds while the consoles stay near the more complex games. Ports of Super Mario Brothers, Sonic the Hedgehog, and The Legend of Zelda have appeared on handhelds. What used to be ****cs have become damned as "casual" games. This is the current industry hive-mind view. This is the hardcore view. But what is the reality?"

No.

Let's divide games into tiers. The first tier mentioned being most immersive and the bottom being the least. Please note that I did not create this list and it's not meant to be perfect, just representative.

" Let me give examples of these tiers:

Tactical RPG/Strategy- Fire Emblem, Final Fantasy Tactics, Master of Orion, Command and Conquer, Warcraft, MMORPGs
Epic RPG- ('epic' meaning very story based) Later Final Fantasy and Dragon Quest games, Ultima, practically most JRPGs
Tactical Shooter- Ghost Recon, SOCOM, Counter-Strike
First Person Shooter- Halo, Unreal Tournament, Call of Duty
Third Person Shooter- Gears of War, Grand Theft Auto 3, Resident Evil
3D Action Adventure- Zelda: Ocarina of Time, Eternal Darkness
3D Platformer- Super Mario 64, Super Mario Galaxy, Rayman 2
Basic RPG- Early Final Fantasy and Dragon Quest. (Likely) Dragon Quest IX
Action Adventure- Legend of Zelda, Metroid
Adventure- King's Quest, Monkey Island
2D Platformer- Super Mario Brothers, Sonic the Hedgehog
Mini-Games / Arcade **** Wii Play, Centipede, Galaga, Pac-Man
Puzzle- Tetris, Dr. Mario
Non-Fiction Game- Wii Sports, Wii Fit, Brain Age, Nintendogs, cookbook software, how to learn English, etc. Flight Simulator, Sims"

Most of the tiers are self-explanatory and because of that I won't explain any of them.

Now we analyze. When gaming started (the arcade era) games were simple, those lower tiers were extremely popular and the only games being produced were those. As time went on and those kids who spent allowances at the arcade got jobs and grew, more and more complex games were being made. These people were able to handle it due to their past experience. The so called "golden era" of the PSX, Dreamcast and N64 is the example of a time where only upper-tier games were selling well. This is due to the growth of the gaming industry. The downmarket tiers were thus abandoned until the DS was released. More on that later.

The "casual" game market today was not created by Nintendo, it was already there. Flash game sites are proof. If you look up "fun flash games" on Google you will find a plethora of sites where you can pick up and play games for a few minutes and get off.

Watch this.

Much like in the gaming era of the NES, SNES, Sega Saturn, Sega Genesis etc., many western game developers were shocked when the market stopped buying their simple games to buy these new "Japanese Games", this happened on the DS.

When the DS was released, it was reviled and not liked due to the amount of shovelware put on the system and the simplicity of Nintendo games that were put on there. Now it is a system with a plethora of AAA titles. Why? Developers realized that their simple and poorly developed games stopped selling a few years in. It seems that the market wanted more than the five-step games they had, and that's what they got.

The Wii -was- doing the exact same thing.

Part 6: How to make a Trillion Dollars

Nintendo saw this market coming with the flash gaming website boom. In 2005, Yahoo saw that 70% of its active users accessed its flash game section of its website. Nintendo decided to dominate this market. The DS was the start of it, then the Wii came along and finished it. They sold everything at an affordable price and got their consoles out there. Then they started producing games the whole family could enjoy.

They had no intention of staying there.

You see, it's a well known fact that the games that make a lot of money are the blockbuster, hardcore games.

Nintendo isn't stupid.

At the time of this article, Nintendo started releasing hardcore titles like Super Mario Galaxy, SSBB, and Mario Kart Wii on its system. The people who had already bought the casual games looked at the new games with awe and tried them, with the experience they had from the earlier games, they were able to easily pick up and play the new hardcore titles.

Part 7: The End of the Birdmen

The Birdmen are the companies who ignored the lower tier market of games. Now Nintendo has a firm grasp on it. There are two things a company can do now that Nintendo has a grasp on it;

1) Fight- Companies try to get into the same market that has already been dominated. This is a risky strategy, because since the market is dominated it is now impossible to reach the amount of success the dominating company has.

2) Ignore it- Pretend its not there and keep selling the top tier product. They will still sell, but not nearly as much as the dominating company's.

Both strategies normally end in failure.

Make the connection?

This could very well spell the end of Microsoft and Sony.

Why? The casual train has been long gone. Nintendo got everyone aboard and rode it off. If Microsoft and Sony don't react soon, it's over.

"OH NOEZ!" You yell in sudden realization, "TEH HARDCOREZ ARE GONNA BE LEFT OUT!"

Read this:

" You see it, don't you? You now are suddenly seeing the Big Picture. Now, when you hear Sony says that they think Final Fantasy XIII or Metal Gear Solid 4 to 'save them', you realize they are relying on the upmarket. Just now, Nintendo announced paid online services and even download content. "What does this mean?" asks a reader. It is a sign that Nintendo is moving upstream into the upmarket, into the more hardcore areas.

The tsunamis were just the beginning. Malstrom puffs on his cigar while standing in knee-deep water. He points to you. Remember this room? Here are the statues of all of gaming's heroes. Malstrom held up out his palm, and you see a drop of water fall into it. You look up to see the roof leaking. "The water is rising!" you shout.

Yes. The Old Era will soon be gone. Enjoy its last gasp. We are in the midst of a huge shift where little will be as it once was.

But my hope is that people will stop being birdmen. Instead of looking at Nintendo's games, their marketing, or their online and say, "Oh? That is for casual gamers! This means they are going for people who don't normally play games! LOL! I AM SO INSIGHTFUL!!!" they will instead look at Nintendo starting at the bottom of the tiers and moving their way up.

A thoughtful reader asks, "Malstrom, this is an interesting and, indeed, ingenious strategy Nintendo is using of creating a very profitable business model, aiming to dominate the lower tiers, and then move up. The competitors cannot compete because they will not be as profitable so they will lose the attrition wars and can only retreat upmarket. What is the name of this strategy?"

It is called Disruption."


Sony and Microsoft saw this coming. They just ignored it, and now that Nintendo has control of the lower tier, they are blaming Nintendo for creating it. It was already there. Yahoo! Games, Addictinggames, Armor Games etc. are proof of. It was a Blue Ocean of opportunity.

That Ocean is now owned by Nintendo.

---

My comments:

This was written in 2008. I think its shocking how relevant it still is. Sean Malstrom was right. Look at E3 2010.
Microsoft and Sony have obviously chosen the "Fight" strategy to beat Nintendo. Their weapons are Kinect and Playstation Move. The only problem is, they're trying to sell to a market that's already satisfied with their Wii, why would they want to spend $150 on a peripheral and $300 on a new console when they already have a console with motion control?
There is proof already that Kinect isn't faring well:

"In an interview with Eurogamer, ShopTo CEO Igor Cipolletta told the site the number of Kinect preorders the retail chain has received is "very low." As for the pricing, ShopTo currently offers the Kinect for €153.75 ($18, while the executive pointed out that a Wii can be had for just a little more. ShopTo's online site is currently sold out of Nintendo's hardware, but the Wii Sports Resort bundle ordinarily sells for €166 ($203).

"It's too high," Cipolletta said of the Kinect price. "We believe that with this current economy it should be around £70 ($105)."

When Kinect arrives, Microsoft expects 15 games to launch alongside the device. First-party offerings include Kinect Adventures, Kinectimals, Kinect Joy Ride, and Kinect Sports. A number of third parties are also on board, developing such titles as EA Sports Active 2, Konami's DanceMasters, and Sega's Sonic Freeriders. Publishers have also promised postlaunch support, such as a Star Wars game from LucasArts, Q?'s Child of Eden, and THQ's UFC Trainer." -Gamespot.com

Playstation Move isn't available for pre-orders yet, but it costs more than a Wiimote and you'll need 2 Move controllers for some games. It's not destined for good things.

Nintendo has just jumped back into the upper tier market. They have a cornucopia of upper tier titles coming out:

Metroid: Other M
Kirby's Epic Yarn
Epic Mickey
Kid Icarus: Uprising
Donkey Kong Country Returns
Golden Sun: Black Dawn
Dragon Quest IX
Final Fantasy: Four Heroes of Light

And even more 3rd and 1st party top-tier titles were announced for the 3DS...

Kingdom Hearts 3D
Resident Evil: Revelations
Metal Gear Solid
Final Fantasy
Assasin's Creed

And so many more. Nintendo is moving right back up with the "hardcorz".

My conclusion? I think Sony and Microsoft have their work cut out for them for the next few years. They have to respond to Nintendo. If they don't, they will fall. Like moths to a flame, and Nintendo will have a virtual Monopoly on the gaming market.

That's not necessarily a bad thing, though. It means another company can try to release a new console/handheld and do well when everyone only has Nintendo consoles and want something a bit different.

This is a marketing plan, and Nintendo has done it successfully.

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