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Nintendo's new president Kimishima takes the reins in a new Q&A
Nintendo's new president Kimishima takes the reins in a new Q&A
February 9, 2016 | By Christian Nutt




Nintendo's Tatsumi Kimishima, who was installed as president in September 2015 after the passing of late president Satoru Iwata, held his second-ever investor Q&A, on the back of the company's latest, down-trending financial results.

Not surprisingly, his answers pointed more toward the future of the company than the past, with the Wii U stalling out and the 3DS having likely crested.

Smartphones and NX key to the future

It's typical for execs to talk up their company's prospects, but Kimishima is definitely less understated than his predecessor.

He's repeatedly claimed that hundreds of millions of users could be attracted to the company's new online services, and he thinks that -- as long as the execution is good -- Nintendo's profits will see a big shot in the arm from the company's upcoming NX console and its smartphone games business, which formally launches next month.

"The question was to pick one area with which we will be able to achieve Nintendo-like profits, but I would like to suggest two areas. One area is our NX business, and another is our business for smart devices. I believe that keeping these two endeavors on track will be key to achieving Nintendo-like profits," Kimishima said.

"To achieve Nintendo-like profits, one important factor will be establishing a solid launch for our NX and smart device businesses. I believe the key to doing this is to allocate our resources appropriately to proceed with hardware and software development on schedule and deliver our products to our consumers in a timely manner."

"Nintendo-like profits" is a term you'll inevitably read in Nintendo investor Q&As, and refers to the huge profits the company raked in during its Wii and DS salad days. Nintendo suffered its first-ever reported annual loss in 2011.

Smartphone synergy will drive the company's business

Its incipient smartphone business isn't to be viewed in isolation -- this is something Nintendo has always maintained. The company hopes to drive players to its consoles by attracting them with smartphone games. But we should expect a tight integration between its smartphone titles and console titles, it seems.

"We have not only NX, but also the Nintendo 3DS and Wii U platforms, and we are of course considering ways to link smart device applications with games for these platforms as well," Kimishima said.

"As for business strategy, the hardware-software integrated business will remain the core of our game business, but we ensure that we will also expand this to include smart device activity and fuse these businesses into a synergistic whole."

In fact, generating excitement around its games (with various new initiatives, not just smartphone titles, it's worth mentioning) will help Nintendo enliven the 3DS market once again, Kimishima thinks:

"The first is to release software that makes people want to play, and the other is to create an environment where people around you are playing. These approaches will spur people who have not played games recently to jump into our games again, and help our software drive hardware sales. For the next fiscal year, it will be important to release titles that are different from the ones we have released this fiscal year, so we will make efforts to provide a strong lineup."

While the system has an impressive 57.94 million units out in the wild, Kimishima acknowledged that many of these are not actively used by their owners anymore.

Expect more licensing of Nintendo's IP

The company is well aware that many of its core demographics -- notably kids outside of Japan -- don't play on Nintendo systems anymore. Asked whether or not the plan is simply to get the company's IP in front of them -- in the form of character-based goods -- Kimishima was blunt: Yep, that's the plan.

"We will also be licensing our IP to partners for other business opportunities. We believe these endeavors are important to spreading awareness of our IP among consumers, but we do not expect that they will drive a major share of our business immediately," he said.

"We want to have everyone become familiar with our IP by reaching as many people as possible from an early age within their daily lives."

Is there a good example? "In America, many children are using electric toothbrushes featuring Mario characters to brush their teeth every day."

Kimishima in charge

In his manner of speaking and his plans for the company, Kimishima does stand out from Iwata.

"... when I became president, I stated that my role was to continue to proceed on the course that I helped to set with President Iwata and the rest of the management at that time," Kimishima said.

Circumstances -- the mobile and NX launches -- dictate that Kimishima is already forced to steer the company in his own direction, one that Iwata laid the course for but which inevitably will demand a firm hand on the tiller.

But it's clear he's open to making his own changes. It's impossible to know who or when the Quality of Life initiative was killed, but it's telling that Kimishima brought it up when asked about his "personal touch" in managing the company.

It's time to keep an eye out for changes at Nintendo. 2016 should be very interesting.



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