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The Mushroom Growth Plan: Inside Nintendo's Numbers
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The Mushroom Growth Plan: Inside Nintendo's Numbers

November 6, 2008 Article Start Page 1 of 6 Next

[Nintendo's new investor presentation includes an amazing set of graphs on the worldwide game hardware and software market, contrasting the Wii/DS with Sony and Microsoft's consoles -- here's Gamasutra's comprehensive analysis.]

Along with announcements of mid-year revenues and profits last week, on 31 October 2008, Nintendo's president, Satoru Iwata, made a presentation to investors which elaborated on Nintendo's position in the global video game market and the company's directions for the near future.

The presentation included some very interesting data. Below we have picked up on some of the more intriguing bits in Mr. Iwata's slides, and used other sources to tease a few additional figures out of the data.

Since Nintendo's presentation included graphs showing sales of the Nintendo DS and the Nintendo Wii as well as for rival platforms like the Sony PSP and Microsoft Xbox 360, we won't limit the discussion to just Nintendo and its products.

Perhaps most interestingly, Nintendo has provided somewhat detailed information that sheds some welcome light on the size of the European market.

The Portable Hardware Market

Since the original Game Boy, Nintendo has dominated the portable game system market, a fact made crystal clear by Mr. Iwata's presentation on Friday.

The figures showed the continued rise of the Nintendo DS in the U.S. and in Europe, the decline of the Game Boy Advance, and some additional information on the health of Sony's rival PlayStation Portable (PSP).

Let us begin with this slide, comparing portable hardware sales in the United States from January through September of the last four years.

U.S. hardware market

After sales of a million units in 2007, the elderly Game Boy Advance has disappeared completely from the American market. Regardless, the Nintendo DS has more than replaced the loss, nearing 5 million in sales for the year and 20% growth year-on-year.

Despite a contraction in hardware sales in 2006, Sony's PSP has sold better in 2008 than it did in 2007. Even with the modest growth of the PSP hardware market and the extraordinary growth of the Nintendo DS, the entire portable market is only modestly up in 2008 when compared to the same period in 2007.

By comparison, the entire European portable hardware market (here represented by sales figures from the U.K., Germany, France, and Spain) grew by about 20%.

Portable hardware sales in EU

While Nintendo DS growth in the U.S. appeared to replace sales of the phased out GBA, in Europe the growth of the Nintendo DS was actual growth of the marketplace. Mr. Iwata claims that these four markets (U.K., Germany, France, and Spain) represent 75% to 80% of the full European videogame marketplace.

Under those assumptions, Europe is now a larger market than the U.S. for portable game hardware in general and the Nintendo DS in particular.

Article Start Page 1 of 6 Next

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