How will the success of Pokemon Go change Nintendo?

Nintendo’s value jumped above $39 billion Tuesday in Tokyo, topping Sony, and extending a run that began after the app become a viral phenomenon.

Bloomberg

After reading the above quote from Bloomberg, I started to seriously reconsider the future of Nintendo as a company. By the way the number quoted above is obsolete. The last I checked, Nintendo's value has already exceeded 42 billion dollars.

How will people inside the company justify the production of console hardware and console games after success like this on the mobile side? After years of struggling with the Wii U, there's already been some speculation of Nintendo leaving the console manufacturing business or in other ways seriously changing their company strategy. Shareholders have been justifiably disappointed and looking for a new way. And then, this happens.

It'd be nice to believe that Nintendo will continue making "traditional games" no matter what, but in the end they are a company in the same way as a Sega, Supercell or Konami. The latter example perhaps being the most poignant one. If the large and risky investments in the console business have lead to losses or minor profits at most in recent years, and a relatively small investment in a mobile game may turn out to be the company's greatest success ever, I just don't see a future where a continued console business would make sense for the owners of the company. Especially if the upcoming Animal Crossing mobile game proves to be even a fraction as successful as Pokemon Go.

How do you duders see the success of Pokemon Go changing Nintendo? Am I too doom-and-gloom, or is someone else seeing a momentous shift coming?

I'm having a blast with Pokemon GO, and I have wanted Nintendo properties on other hardware forever, I Haven't owned a Nintendo Console since the N64 aside from the handhelds (GB, GBA, 3DS) and I am looking forward to being able to play more from them on the mobile market. I know there is some pushback against Pokemon GO for not being traditional Pokemon but as someone who has played those games for 20 years and loved that franchise I couldn't be happier about GO being a huge success, the fact that I can now mention most of the 151 originals and have people know what I am talking about is awesome.

I hope Nintendo's new console is the real deal and brings the handheld market and TV set box market together.

They will still continue making consoles. Or at the very least NX. From a pure numbers standpoint, they've already spent a lot on R&D for the new console. Nintendo needs to make that back. Not to mention there are still a lot of people in the company that love making games. Mobile games are just so different from console ones.

That being said, I'd be shocked if Nintendo's existing mobile division doesn't double, maybe even triple, in size within the next year. They may wait to see how their own in-house games, Animal Crossing and... that other one, do before making any drastic company changes. But it's impossible to ignore the success of Pokémon Go. It's very easy to see its success lasting for years (improving the experience, adding new features, and of course, more Pokémon).

I know Nintendo is notorious for reacting slowly to advancements in technology, avoiding the internet for as long as possible, and in general doing their own thing. However, the massive financial success that this game has been, along with the fact that people LOVE IT despite its flaws, means that anyone with a brain at Nintendo should be viewing this as a turning point in their storied history.

Nintendo's stock will probably fall back again just like it did with the Wii.

They certainly have room to grow into the phone market. This shows them that hopefully but I just can't say what Nintendo will do. Like others have mentioned it's still Niantic involved.

If I was them I would probably just pick and choose who to work with and get pitched stuff to use with their existing IP. I'm sure they could set up some good deals for themselves.

I think they should go further even but I just would not expect that. Imagine a full Animal Crossing phone game with GPS based items to get for yourself, or say if you are in a different area in the real world you could be in a new area entirely to explore. At some point, Nintendo has to ask if something like AC wouldn't just be able to be that much bigger on a phone that they should do it. They should already be asking that.

I hope Nintendo are learning some good lessons right now about the power of massive appeal and how powerful their IP's can be when you actually leverage them. The rumors floating around about the NX are a little troubling if you're a Nintendo shareholder. The rumors that the console may be severely underpowered compared to the scorpio or NEO is worrying, and also Nintendo hasn't had a great track record of getting 3rd party support since the wii, which was fine for them for a little while. That's not going to fly now, the gaming market is way more competative than it's been in the past. We're seeing companies iterate on a much faster basis and doing better business from a games and IP standpoint. The Wii U is great console for when Nintendo make a game, but Nintendo also only sold 21 Million Wii U's to date. That's good but it's also completely overshadowed by what the Playstation and Xbox competition have been able to sell to this point.

My hope is that Nintendo learns to not be so stringent with their IP, and learns to have wider appeal. It's great and all to have Pokemon GO put your stock ticker right up next to Sony, but if it's going to stay there, Nintendo can't have these crazy unique consoles that only they can develop easily for. The idea that's been floating around that the NX is a portable-console hybrid is great, that has appeal to a wide audience. But, it must have the ability to play the same games as PS4 or Xbox on at least a close level of performance. Not only that, but it is far beyond time for Nintendo to get it's act together with 3rd parties and with it's own back catalog of games. You're seeing them make some interesting moves with the NES Classic that was recently announced. Right now, there are probably people out there who are lapsed Nintendo fans that had an NES or SNES or an N64 growing up and would love to play those games again. The concept of a service that gets you access a large library of games is something that should exist. Nintendo has never had more attention in this console generation than they do now, it would be foolish not to capitalize on the attention and pop culture cache that Nintnendo has with a larger audience. Pokemon GO is a really great start to a better Nintendo. To complete the accendency, it needs to concentrate on it's NX offerings (first and 3rd party), and it needs to really push the envelope in regards to services that have mass appeal to current and past Nintendo/gaming fans.

I believe they've been focusing on mobile stuff in japan for a while now right? Hopefully it will mean they will stop making consoles and we can get nintendo games on other platforms. :-)

Nintendo was already working towards mobile gaming and licensing their IPs following the recent change of leadership. I'd say this is more of a reassurance for them and their investors than a sign of a significant course change.

Man, after the success of Pokemon Go, think about how great they will be doing if the mobile Animal Crossing thing is good.

Come on Nintendo, don't fuck up the Animal Crossing thing.

I'm hoping this will allow them to really double down on the mobile Animal Crossing and Fire Emblem games. Animal Crossing in particular seems perfect to hit the same kind of attention as Pokemon Go in the way that its a cute time killer kind of deal. I don't think they'll drastically change business models or anything though. There's room for both paths to be taken at the moment. If NX is a failure then maybe we'd have to start wondering what is more beneficial for them, but we'll see.

Well, given that this will die down, I think their stock will plummet. That might be a year from now, or two years, but what goes up goes down. The very un-funny thing about stock investors is they expect profits to rise continuously.

What has happened to Nintendo's stock is not healthy for them unless thyy can make tangible strides in infrastructure, employees or sales of tangle goods. It is all well and good to be bullish on Pokemon GO while the game make 1.6 million dollars a day, but what happens with only 10% of the current players remain? This smell a lot like Wii where huge sale made people bullish, but they Nintendo noticed they were not selling software...they put out a Wii Sports machine where the sale of consoles did not turn into a lucrative install base to sell more games. We can all remember that losses Nintendo took when Wii tanked. But that was not the worst of it. They marketplace that Wii created also made things like uDraw occur. UDraw took THQ out at the knees because they though something that worked on Wii would work on PS3 and XB360. This sort of flash in the pan idea creates very few winner and a lot of losers when the fantasy fades.

Nintendo might actually have hit upon a good idea which is the Mini-NES - it is a tangible device that will sell very well. Moreover, If NX is worthy of interest that will help too, but if they cannot make anything substantive to back the stock valuation the value will drop. In fact I think Nintendo is now under enormous pressure to be correct abut NX. The success of Pokemon Go might make vocal investors INSIST that Nintendo stop all this foolishness of making unprofitable consoles. If you think Nintendo games showing up on Sony's console, on iOS, and on Android is not great - well, just watch that is when investors will want.

They'll probably make a tiny Nintendo with pre-loaded games.

I wonder how much Nintendo actually had to do with this. (Other than a 33% share hold in The Pokemon Company)

Call me crazy, but I have my doubts this alone will affect them. Will Pokemon Go be a game that is supported for the next 5 years? Will there be a Pokemon Go Yellow equivalent? Will there be a Pokemon Go 2? Will this game be played so often one month from now? Six months from now?

There's so many things that are up in the air regarding how successful this game will be over a 12 month period and even then who knows what they will do with it. Will this game make them a billion dollars and they don't need to do anything else? Will they make the same game but with Pikmin? A true Animal Crossing game with this type of GPS functionality?

That said, and I'm not a guy who would ever be serious about investing in stocks, man I'm kind of shooting myself in the foot. Their stock price literally doubled. Regardless of how this all plays out, that's really impressive.

It will just reaffirm Nintendo's current stance on mobile gaming: do the minimum amount. Look at Miitomo. It was cool for about a day or two then you realised there was very little to actually do. It really should've been a phone version of Tomodachi Life. Likewise Pokemon Go is barely a game. It has all the hooks to keep players invested but only for a few minutes at a time and the hype will die down eventually. Websites and news outlets are just cashing in on that hype right now. Sites such as the Verge and IGN are all over that Pokemon Go just because it's more searched than porn.

It's funny, people have been saying Nintendo should get out of the hardware business and make software for other platforms for years. The moment they do they have bonafide cultural phenomenon on their hands. Scrap the NX, go multi-platform. Fuck it.

(I'm aware Niantic developed Pokemon Go, but anyone who thinks that game would have been popular without decades of groundwork from Nintendo and Game Freak is dreaming)

Pokemon on a non handheld would be awesome, maybe an added bonus of putting someone my phone to take for a walk like the pokemon pedometer thing that came with some version. As an adult my game time is at a premium and if the choice is a handheld or playing on my big TV, there is no contest.

@takayamasama: I don't see how a mobile Animal Crossing could be as big as this, because Animal Crossing has never been as mainstream big as Pokemon was from about 1998-2000.

It's hard to draw too many conclusions from what's going on right now. The big draw was an IP that they've built on for 20 years but it's worth keeping in mind the whole game only works on the back of the mapping data and software experience that Google and Niantic put into this game and that's not something you can just keep reskinning or replicate for all of Nintendo's various IPs.

Upping investment in mobile isn't a bad idea for Nintendo but the mobile space is so crowded that expectations should be kept modest.

As a public traded company, investors will push even more for Nintendo to focus on mobile going forward, so yeah I assume this will have an lasting impact on Nintendo.

Even more so of course in case the NX doesn't sell like hotcakes right out of the gate.

It's Wii motion controls all over again. The Trickle of game development because they never want to blow their load.... but then with the Wii U they did blow their load and nothing. Star Fox Zero was suppose to be their big game considering it was Miyamoto's HUGE design choice how to make games for the Wii U controller..... and then on top of it they didn't really make the game...... No one is learning anything from this.

@clagnaught: From a personal finance point of view, you should invest in stocks and the like. It is a better use of your money than to have it sit in a bank where it only gets a 1% return. A savings account is still good, but investing in stocks can net you more money. Just keep your portfolio beta as small as you can and you'll be alright.

I know this sounds really base, but is anyone concerned about the effects of winter on this game? Good luck getting people to run around everywhere when it's cold outside.

Also there's been a lot of people taking a short position on Nintendo lately.

http://www.cnbc.com/2016/07/22/nintendos-stock-sees-massive-jump-in-short-interest-despite-pokemon-go-craze.html

@thebigaristotle: Depends on your location in the winter I guess. I sure as hell won't be taking the trail along the river in my town, but the mall and other indoor areas are still viable in bad weather. And I still have to walk around campus for classes so I don't really have a choice on going outside or not. Id imagine college campuses will still be pretty popular spots for that reason even in winter. I can also reach most of the gyms around me from in a car or in a building as well.

I'm sure it'll see a decrease in use for sure though. Maybe they'll try to combat that with releasing a new gen or something.