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Consumer

Nintendo sees chance for Switch to beat Wii sales record

President open to tech investment outside the company to improve its hit console

A display promotes the Nintendo Switch at a Tokyo electronics store.   © Reuters

OSAKA -- The versatility of Nintendo's Switch will open up new avenues of gaming that could keep the wildly popular system on the market beyond the usual console life span of five or six years, President Tatsumi Kimishima recently told The Nikkei.

The Switch -- on track to sell more than 17 million units in its first year -- could become the company's best-selling console ever, surpassing the Wii's 100 million units over six years. Kimishima said Nintendo has an eye on the newest tech in search of ways to keep the Switch fresh.

Excerpts from the interview follow.

Q: The Switch has been in short supply at stores. Will it keep selling that well in its second year?

A: There's a variety of features in the controller, such as sensors. By further evolving how it can be used, we hope to keep sales growing for five to six years or more. The longer [it stays on the market], the better.

Q: Sales of the Switch in its first year were supported by gamers and game-loving families.

A: The second year is vital. We want to broaden the base of buyers in part so [the Switch's] popularity doesn't wane. We're developing games that will make parents want to encourage their children to play on the Switch. For example, with Nintendo Labo, which we announced in January, we proposed a new way of playing: cardboard structures that can be assembled and linked to the Switch to play [minigames].

Nintendo President Tatsumi Kimishima

Q: How do you plan to use the roughly 800 billion yen ($7.31 billion) in cash you've accumulated from the Switch's success?

A: Technological progress is fast these days. We're always thinking about what comes next after the Switch while looking into the latest technology. Even with sales falling for the last eight years, we've still invested in research and development. We were able to develop the Switch and offer an appealing lineup of titles in its first year because of our abundant capital. Creating smash hits is Nintendo's reason for being.

There's plenty of interesting technology outside Nintendo as well. We'll consider investing outside the company if there's something we think we can integrate with our technology.

Q: What's your outlook for monetizing your mobile games?

A: We forecast group sales of more than 1 trillion yen for this fiscal year. To maintain that level, we need a set of three or four core games. Though [the mobile game business] has grown to more than 10 billion yen [in annual revenue], it can be said to stand on its own as a business once sales are an order of magnitude above that. We want to get it to that point soon.

Q: Have you thought about when you'll hand over the business to a successor?

A: The most important thing for an executive is knowing when to leave. When [founding family member and president until 2002] Hiroshi Yamauchi stepped down, he left us with these words: "I don't know how things will go, but take responsibility for what you do." I think that's exactly right. I'm always thinking about the timing of my departure.

Interviewed by Nikkei staff writer Shiko Ueda

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