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Iwata and Miyamoto: Business Ascetics - An Excerpt from Nintendo Magic
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Iwata and Miyamoto: Business Ascetics - An Excerpt from Nintendo Magic

May 14, 2010 Article Start Previous Page 2 of 4 Next

Near the beginning of the Wii's development, Iwata said to [Nintendo R&D general manager Genyo] Takeda -- and it wasn't clear if he was joking or not -- "What if we made a console with like six slots, so you could play games from all kinds of systems?"

Takeda later agonized over this in private. Did the president mean it?

The truth was somewhere in between: "The thought was serious, but I was half-joking about the method," Iwata says. Eventually they settled on a virtual solution where games from a variety of older systems could be downloaded via the internet.

It was not unlike the "Famicom Mini," which reissued old NES games. They went on sale in 2004, winning success by including games that hearkened back to the NES era, appealing to both the nostalgia of adults who'd played the games as children and the frustration of those who hadn't been allowed to.

Perhaps nostalgia could be another aspect of the new game system. That possibility was the basis for the development of the Virtual Console. "We don't want to just give the games away," says Iwata flatly, "but it also isn't meant to pull in huge revenues."

At the same time, he's confident he'll get good results. "There's always the possibility that it could become an unexpectedly large revenue stream. It involves so much less energy than making a new game. I have confidence that they'll be more steadily profitable than the cell phone games a lot of game developers are working on now."

What kind of man is Satoru Iwata -- that he can perfectly balance humility against unwavering confidence? A closer look is in order.

Satoru Iwata: The Heart of a Gamer

The Wii -- which at the time was still known only by its codename, "Revolution" -- was revealed at E3 2005, though the design of its controller would remain a secret.

Two months before that, Iwata was at the Game Developers Conference (GDC) in San Francisco. On the fourth day of the event, he took the stage after Microsoft's vice president and delivered his keynote address. He began by holding his business card up in the air.

"On my business card, I'm a company president," he began. Then he pointed to his head. "But my mind's that of a game developer." Finally, he put his hand to his chest. "And at heart, I am a gamer."

This self-introduction perfectly captured the essence of the man named Satoru Iwata, and it won the hearts of the audience in an instant.

No matter how far back we look in order to understand Iwata -- who dedicated himself to broadening the gaming population, succeeded, and yet remained humble -- we will find games.

He was born in Sapporo, on the northern island of Hokkaido, in December 1959. The eldest son of a prefectural official, he was brought up comfortably. He displayed leadership potential early, serving variously as class president, student council president, and club president while in middle and high school. It was while attending Sapporo South High School that he first encountered computers.

It was regarded as the best school in the city, having turned out many graduates who went on to become well-known political and business figures. The school philosophy emphasized initiative and autonomy -- it lacked even a uniform, making it a rarity among Japanese high schools. Iwata had a part-time job washing dishes, and with the money he saved up (along with some extra from his father) he bought a Hewlett-Packard HP-65 calculator.

It was the world's first programmable calculator. Introduced in 1974, it was considered a marvel of engineering, having even gone into space as a backup for the Apollo Guidance Computer during the Apollo-Soyuz Test Project.

The word "PC" hadn't even been invented yet, but already Iwata was drawn into learning how to program the tiny computer, devising games like "Volleyball" and "Missile Attack" and playing them with his classmates.

In love with computers, Iwata entered the Tokyo Institute of Technology in 1978 to study computer science. This time he used the money he received as a graduation present to buy a Commodore PET -- with integrated monochrome display, keyboard, and cassette tape reader, it was the world's first all-in-one computer.

He would store his programs on cassettes, and bring them every week to the Seibu department store's computer department to show off. By the time he was a sophomore, a group of the store's employees had formed a company called HAL Laboratory -- and they invited Iwata to join them. It was the beginning of his career as a game designer.

The computer that appeared in Stanley Kubrick's film 2001, "HAL," turns into "IBM" if you substitute each letter with the one that follows it in the alphabet. HAL Laboratory took their name as an homage to this -- it indicated their resolve to "stay one step ahead of IBM."

It was a lofty name, but when the company was founded it had only a handful of employees who worked out of a one-room apartment in the Akihabara district of Tokyo. Its main business at the time was the development and sales of peripherals for the PCs (then called "microcomputers") that were becoming popular at the time. They had only one game programmer -- Iwata, the part-timer.

Just as he was starting the job, his father, Hiroshi Iwata, won the mayoral election for the city of Muroran. In the four terms he served thereafter, he left behind him a legacy of achievement on behalf of the city, including fighting for fiscal reform, pushing through construction of the Hakucho, or Swan Bridge (which straddles the Port of Muroran and is the largest suspension bridge in eastern Japan), and preserving a Nippon Steel Corporation blast furnace that was scheduled for closure.

Iwata was now the son of a mayor. He was attending a top school. But he had no interest in becoming one of the elite. He was so fascinated by games that upon graduation, he went straight to work for the unknown HAL. As the company's first video game developer, he had no one there to learn from but continued to polish his skills on microcomputer games on his own.

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