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Super Mario Run jump-starts Nintendo on phones

Gamers frustrated by delayed launch on App Store


With its existing machines in the doldrums and its next console months from release, Nintendo has made its killer play for the seasonal games market with the deadliest weapons in its arsenal: mushrooms, homicidal tortoises and the world’s most famous moustache.

The promised launch of Super Mario Run on Apple’s App Store on Thursday failed to materialise before midnight local time for Japanese gamers, with its release happening instead on Thursday morning in California, leading to thousands taking out their frustrations over the delay with complaints on Twitter.

Appearing for the first time on a mobile phone, played with a single finger and requiring a permanent internet connection, Super Mario Run marks a clear break with Nintendo’s past.

It is designed, according to Mario’s creator Shigeru Miyamoto, for complete beginners. But it is pulling hard on the heartstrings of generations of games fans who have grown up on Super Mario and may now be prepared to pay an unusually high fee for the privilege of rejoining him on their iPhones.

The pricing model gives the first three levels for free, but charges a one-off fee of $10 for the full version with 24 levels. David Gibson, a games analyst at Macquarie, said the pricing would prove critical both to the success of Super Mario Run, and to Nintendo’s strategy, as it rolls out more smartphone games in 2017.

“I think one of the issues about this game that has not had a lot of attention yet is how long it will actually hold people’s attention. How much playing time will people get for their $10? That is going to be a big factor in how much this game makes in the end,” said Mr Gibson.

Nintendo’s market value has more than doubled to $33bn over the past six months, partly on expectations of the app’s launch and the management’s experiment with smartphones. Analysts are sharply divided on how excited investors should be. Some see Nintendo on the cusp of substantial profits from smartphone games.

On the bullish end, Jefferies estimates 500m downloads on iOS by the end of March, with 10 per cent of users paying the $10 charge, which would translate into $500m or ¥50bn in revenues. It took Pokémon Go, a title produced by the US-based Niantic, only 60 days to top $500m in global customer spending, according to researcher App Annie.

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Others question whether its insistence on a one-off $10 price tag gives Nintendo a business model that ultimately delivers smaller revenues than the “freemium” model of paid in-game upgrades deployed in global smartphone hits such as Clash of Clansand Candy Crush.

Among analysts, fans of Nintendo suspect that the company may not be too bothered by the financial success of Super Mario Run, but is using it to provide the market with a foretaste of a possible Mario-based launch title for the Switch — the new console it is launching in March.

“Super Mario Run will have a significant impact on the success of Nintendo Switch. You cannot take these two products separately,” said Takao Suzuki, analyst at Daiwa Securities.

As the global smartphone games market has advanced to be worth $36bn, the conservative, Kyoto-based company has taken a back seat — fearing piracy, dilution of its brand and a loss of control over characters whose reputations it has nurtured over nearly four decades.

Its decision to venture into the smartphone market, prompted by the global success of Pokémon Go, has come with typical Nintendo caution: it has opted for an exclusive deal with Apple that, for the time being, will see the game distributed only via the App Store. A version for Android phones is expected next year.

“Nintendo gained confidence after seeing the wide acceptance of Pokémon Go,” Hirokazu Hamamura, gaming industry expert at Japanese publishing and media company Kadokawa Dwango. “Among Nintendo characters, Mario is of course the main star compared to Pokémon.”

Source; Leo Lewis and Kana Inagaki in Tokyo - Financial Times