Hero-of-Time Posted February 9, 2016 Posted February 9, 2016 It's now been translated into English. Here's what was asked at the meeting. Question 1 Miitomo seems more like a communication application than a game. Can you tell us any more about the other approximately four titles that will be released after Miitomo by March of 2017, such as the intellectual property (IP) that will be used or the direction of these titles? Answer 1 Tatsumi Kimishima (President): First, I'd like to reiterate that we have not placed any restrictions on the use of our character IP in these titles. We believe it is important to consider the timing and design of these titles to create a synergistic relationship with the games on our existing dedicated video game systems that use Nintendo characters. We are also considering developing titles for smart devices that are not at all tied to any games on our existing dedicated video game systems. We believe Nintendo is uniquely poised to connect applications for smart devices with games on dedicated video game systems. We are currently developing the next titles using Nintendo's character IP, so we hope you will look forward to them. We will have more concrete announcements in the future. Question 2 You just mentioned that the release of applications for smart devices may be timed to achieve synergy with games for existing dedicated video game systems. Can you provide any other information about when we should expect to understand the overall picture, including the smart device business and NX (the new game platform under development), including things such as how future applications for smart devices might be timed to achieve synergy with the release of NX? Answer 2 Kimishima: To start, I'd like to point out that we aren't going to be sharing any details about NX today. I may not be able to answer the question in full as it relates to NX. 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. On the other hand, our development plan is also considering providing new ways to play aimed specifically at smart devices. Since I can't share any more information about NX at this time, that is all I can say to address the question. Thank you. Question 3 With regards to the financial performance, I believe you said that the fiscal year ending in March 2016 has been about balancing revenue and expenses, while the next fiscal year (ending in March 2017) will be a step towards aiming for Nintendo-like profits. Have these priorities changed at all? It seems like a lot of new endeavors, such as smart device business and amiibo sales, will need to go smoothly in order to realize Nintendo-like profits. If you had to provide one example of an area where you can be sure to achieve Nintendo-like profits, what would that be? Answer 3 Kimishima: The previous and current fiscal years have been a period of preparation to launch a number of new endeavors, such as NX development, development for smart devices and business using our character IP, in addition to driving our Wii U and Nintendo 3DS businesses. At the same time, it has been our priority to take a close look at areas of our existing business where the revenue and expenses had become unbalanced, and to make sure that we corrected this balance. As I have said before, we will be launching many of our new business activities as we move from this fiscal year into the next. When you start any new business, it is important to make the public aware of what you will be doing. In the next fiscal year, we will have to make preparations and investments to achieve these goals, and that comes with certain costs. 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. I don't have any further details to share about the next fiscal year at this time, but we will explain about our plan and when we will aim to achieve Nintendo-like profits at a future date. Question 4 Nintendo has been working to restore balance between revenue and expenses and has announced a number of new ventures during this and last fiscal years in order to realize Nintendo-like profits from next fiscal year on. How would you evaluate your current progress on your plans, such as reorganization and business partnerships? What areas need improvement in the future? Answer 4 Kimishima: We have made a number of changes to our corporate structure to gear up for our new ventures. For example, (as I have described before,) where development was split between handheld and home console divisions in the past, we have unified these activities for both hardware and software development, and the exciting new ideas coming from development are evidence of the progress being made as a result of that unification. We are also making steady progress in working with our partners in a variety of businesses. Of course, gaps in communication that may arise from reorganization could hinder plans that require timely execution. This is why our Corporate Planning Department is also implementing organizational reform that allows for precise understanding of progress across the whole company. The General Manager of the Corporate Planning Department has a lead role in this project. 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. Question 5 The "Message from the President" has been updated from President Iwata's message to your message, President Kimishima (as posted on the Nintendo website in December 2015). In your message, you discuss "increasing the number of people who have access to Nintendo's intellectual property." This could be misinterpreted as Nintendo only being focused on consumers who are interested in its character IP (for example, licensed goods). Can you explain the intent behind this message? Answer 5 Kimishima: The policy I have discussed (in the "Message from the President" on the Nintendo website as well as in the Corporate Management Policy Briefing in October 2015) is our mission to increase the number of people who have access to Nintendo IP. For example, due to changes in our industry, the proportion of young consumers who are first experiencing games on our systems has been falling. 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. Our long-term strategy is to spark our consumers' interest in playing Nintendo game systems and encouraging continued growth of our games business. I can provide a couple of examples from outside of Japan. In America, many children are using electric toothbrushes featuring Mario characters to brush their teeth every day. We have also worked with a shoe company to launch shoes that feature the designs of Nintendo game systems. As you know, we are also working on a theme park featuring Nintendo IP. Our policy and the focus of our current activities is to create more chances for our consumers to experience the charm of Nintendo IP, not just on our dedicated video game systems, but outside of game software as well. Question 6 When you became president, Mr. Kimishima, I believe you stated that you would be carrying on the existing strategies, but we also expect that you will bring your personal touch to Nintendo's business strategy. Do you have a plan that you can share today, or do you intend to leave strategy to the younger generation? Are there any particular goals that you have set for yourself? Answer 6 Kimishima: As you said, 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. The ideas of our young employees are also key to our ability to transition to the next generation and to continue to produce exciting ideas. It is important to structure our organization so that these young people can take active roles. We have worked to establish such an organization; one that will allow our employees to reach their full potential in many different areas. It may be difficult to see from outside of the company, but we have made major changes to our organization. For example, our game developers have not had much of a public presence in the past, but we would like to create more and more opportunities for you to get to know them in the future. 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. “My Nintendo” is a crucial part of this strategy as well. We seek to deepen our relationship with our consumers by having them join the “My Nintendo” program. I would also like to touch on the QOL (Quality of Life) program today. We do not feel that we are currently at a stage where we can commercialize a product that deals with sleep and fatigue, so we are not planning to launch any products in this area in the fiscal year ending in March 2016. However, we do believe there is potential in the QOL sector, so we will continue to consider further development in this area. Question 7 In the next fiscal year, I understand that some up-front costs will be incurred, particularly in the first half of the fiscal year, as you will invest in new businesses before their actual execution. Could we estimate that the new businesses will contribute to the overall profits for the full fiscal year? If that is the case, should we expect that new businesses will drive results in the next fiscal year? On the other hand, I believe that you will have results from the holiday season and you are able to see the pipeline for the next fiscal year. Do you expect that the existing Nintendo 3DS and Wii U businesses will continue to contribute to profits, for example through sales of current titles? Please share whatever you can about where you expect to see profits over the next fiscal year. Answer 7 Kimishima: First, I'll address Nintendo 3DS and Wii U. As I described in the presentation today, Nintendo 3DS has sold over 20 million hardware units in Japan and over 54 million units globally. This presents an excellent chance to increase revenue through software sales in the Nintendo 3DS business. We presented a number of titles today that show what kind of software can drive our business. We have not yet announced all of the Nintendo 3DS software for the next fiscal year, but we are proceeding with development, including major titles. The Nintendo 3DS will continue to be a major pillar of our business in the coming fiscal year. As for the Wii U, we have just passed 10 million units worldwide, so it is not quite on the level of the Nintendo 3DS. However, we have received a great response for titles such as Splatoon and Super Mario Maker, and we would like to continue to release titles we expect to be received positively in the next fiscal year. As for new businesses, we will present further information when we go into details about our forecasts for the next fiscal year. We do not plan to speak about NX today. We continue development and planning efforts for NX in preparation for launch, so it will require additional investment. Our expansion into smart device applications will depend on what kind of response we get from consumers. 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. That's all I can share about the next fiscal year at this time. Question 8 Could you go into a little more detail about why the Nintendo 3DS software sales have not lived up to forecasts, and what plans you have to address this in the next fiscal year? You seem to be confident in your ability to some degree to win over more female fans in Japan, but the hardware and software targets were not met on a global level. Please explain why you think software sales have been lower than expected. Answer 8 Kimishima: First, I will address Nintendo 3DS software sales in this fiscal year. As I acknowledged in the presentation, the titles we have released this fiscal year have not had quite the same potential as titles such as Pokémon Omega Ruby/Alpha Sapphire and Super Smash Bros. for Nintendo 3DS that we released last fiscal year. To expand this business in the next fiscal year, reaching young consumers and women and expanding our sales of our evergreen titles will be key. As I said before, we have sold over 54 million units of Nintendo 3DS hardware, but it would have been possible to sell more software if all 54 million systems were in frequent use. I believe there are two approaches we can take to improve this. 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. The question asked about issues that we have had. One of our endeavors this fiscal year has been to release multiple titles for young consumers and women. There was some variance in the response to these endeavors across different countries. For example, each of the European markets has different characteristics, but we were able to achieve a great response with our promotions and advertisements aimed at women in France and Spain. Going forward, we will also focus on promoting sales in regions where we did not meet expectations for this period so that Nintendo 3DS will be well-received there, too.
Dcubed Posted February 9, 2016 Posted February 9, 2016 (edited) Kimishima: To start, I'd like to point out that we aren't going to be sharing any details about NX today. I may not be able to answer the question in full as it relates to NX. 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. Yet more hints that they're not planning on dumping Wii U and 3DS immediately... As I said before, we have sold over 54 million units of Nintendo 3DS hardware, but it would have been possible to sell more software if all 54 million systems were in frequent use. I believe there are two approaches we can take to improve this. 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. The question asked about issues that we have had. One of our endeavors this fiscal year has been to release multiple titles for young consumers and women. There was some variance in the response to these endeavors across different countries. For example, each of the European markets has different characteristics, but we were able to achieve a great response with our promotions and advertisements aimed at women in France and Spain. Going forward, we will also focus on promoting sales in regions where we did not meet expectations for this period so that Nintendo 3DS will be well-received there, too. Interesting little tidbit about Spain and France there Edited February 9, 2016 by Dcubed
liger05 Posted February 9, 2016 Posted February 9, 2016 Glad to see QoL has been postponed. This seemed like a sure way to lose money to me.
Agent Gibbs Posted February 9, 2016 Posted February 9, 2016 Whats the point (from a shareholder point of view) of coming to these meetings and being unable to discuss the future properly because you can't discuss future platforms? surely if they are scared of leaks in advance of big launches, have NDA's publicish minutes redacted or at a later date or hold them closer to big launches I'd be frustrated to get half answers to my questions on the future because they aren't willing to discuss a future project, especially one everyone knows is coming soon! it could only be worse if they publicly give details in the next 28 days
S.C.G Posted February 9, 2016 Posted February 9, 2016 In this advanced age I think Nintendo are wise to keep their cards close to their chest, even away from their investors, I know that's where a lot of their money comes from but really... a little bit of patience goes a long way. Nintendo obviously have a plan, let's just see where they go with it, nobody was expecting NX details to be divulged at this Q&A - fans or investors alike - so it's hardly a surprise. I still think there is a chance that we will see the NX in some capacity in 2016 but I don't expect to hear anything concrete until E3 week at the earliest. This has been a difficult transitional period for the company and it's certainly going to be an interesting year one way or another, I just hope things pan out as planned because Nintendo surely has a lot more to share with us; when the time is right. : peace:
nekunando Posted February 9, 2016 Posted February 9, 2016 This has been a difficult transitional period for the company and it's certainly going to be an interesting year one way or another, I just hope things pan out as planned because Nintendo surely has a lot more to share with us; when the time is right. : peace: Yeh.. I don't want any leaks before the proper reveal! I just want to be able to take the day off work, kick back and let Nintendo show me the future
david.dakota Posted February 9, 2016 Posted February 9, 2016 Whats the point (from a shareholder point of view) of coming to these meetings and being unable to discuss the future properly because you can't discuss future platforms? surely if they are scared of leaks in advance of big launches, have NDA's publicish minutes redacted or at a later date or hold them closer to big launches I'd be frustrated to get half answers to my questions on the future because they aren't willing to discuss a future project, especially one everyone knows is coming soon! it could only be worse if they publicly give details in the next 28 days And giving shareholders this level of detail in private would drive share prices up and down on a whim. Just guessing here but I suspect it'd be illegal to let select people have knowledge that would affect their purchase or sale of shares.
Hogge Posted February 10, 2016 Posted February 10, 2016 I interpret this as Kimishima still is greenlighting new games for the Wii U... Which is strange IMO.
Glen-i Posted February 10, 2016 Posted February 10, 2016 I interpret this as Kimishima still is greenlighting new games for the Wii U...Which is strange IMO. Why? Wii U games are not gonna screech to a stop as soon as the NX comes out.
Hogge Posted February 10, 2016 Posted February 10, 2016 Why? Wii U games are not gonna screech to a stop as soon as the NX comes out. Well, for three quite diverse reasons. First off: That's usually precisely what it usually means. When a new Nintendo console launches, there usually aren't any more first party games coming out for the system. Perhaps something small that launches a few months after, due to delays. With the NX likely launching this year, starting development for new Wii U software now would mean that we'd be seeing that software launch at earliest in mid 2017... atless it's shovelware. Second: Nintendo had virtually nothing to show off at last years E3, which basically killed the system. They failed to uphold the little momentum and faith in the system they managed to build in 2014. By now, it's literally pointless to start developing something for the Wii U. Third: The Wii U bombed because of a constand drought of games. Nintendo themselves claimed that this was initially the case because they were using too much resources to churn out 3DS-software and that they underestimated the costs of HD development. The NX may be Nintendos last chance to be taken somewhat seriously by third parties, the gaming press and the consumers. A strong lineup is going to be the difference between the NX being sold out after six months and the NX hitting bargain bins after six months. It's not all negative, though. Since I'm not going to preorder the NX due to said weak software for the Wii U, I'll be pleased if I can get some more enjoyment out of the machine.
Dcubed Posted February 10, 2016 Posted February 10, 2016 Well, for three quite diverse reasons. First off: That's usually precisely what it usually means. When a new Nintendo console launches, there usually aren't any more first party games coming out for the system. Perhaps something small that launches a few months after, due to delays. With the NX likely launching this year, starting development for new Wii U software now would mean that we'd be seeing that software launch at earliest in mid 2017... atless it's shovelware. Not always... GBA got a full 2 years worth of support after the DS came out, with some not insignificant releases like Pokemon Emerald, Drill Dozer, Wario Ware Twisted, the Bit Generations series (Japan only), Mother 3 (Japan only... but not for much longer ) and Rhythm Heaven (Japan only). Remember how they pitched the DS as a third pillar? Well that's what they've been doing with the NX as well. Notice how they keep saying that they're not looking to dump support for the Wii U and 3DS as soon as the NX comes out and that they're gonna keep supporting them with unannounced titles? Same thing. And you can bet on Pokemon Gen 7 being for 3DS. It can't come out early in the NX handheld's life because they need to have a certain sized audience in place first, before it can release on there. They just announced the first Gen 7 Pokemon today, meaning that the next mainline game isn't far off now... And since it can't go on NX, that means it's going to 3DS. So the 3DS and Wii U will still be getting significant games released for them for some time still. It's not gonna be like with the N64, GCN and Wii, where they were unceremoniously dumped immediately after the successor came out. With this transition, it's gonna be more like NES, SNES, GBA and DS in that regard.
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