Sales Expose Nintendo’s Biggest Weakness. : ThyBlackMan

Sunday, December 15, 2019

Sales Expose Nintendo’s Biggest Weakness.

March 24, 2019 by  
Filed under Opinion, Tech/Internet, Weekly Columns

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( The Nintendo Switch just turned 2 years old and became the best selling console in January. The hardware has broken many records in the last two years, but these impressive sales figures also expose Nintendo’s biggest weakness. If you check the console’s library of games, you will notice that almost 85 percent of Nintendo Switch games come from Nintendo itself. It means the company is heavily relying on first-party titles and that’s really bad. Here’s why it could be risky for Nintendo.

It’s no brainer that all the video game consoles thrive on content and the success Nintendo Switch has seen over the years is because of the games like The Legend of Zelda: Breath of the Wild and many others. Nintendo has a huge library of modern and classic games and the company is bringing many of them to the Nintendo Switch games library. Nintendo has also launched an online subscription service for its console, but most of the games you see in the library are either developed or published by Nintendo leaving very less room for content from third-party developers and publishers.

The sales figures revealed by Nintendo clearly suggest that the games on its latest console are driving the profit. It is also true that the company has seen some negative feedback for not maintaining consistency in releasing new games. The nostalgia factor is high with the release of classic Nintendo games, but relying too much on old games will definitely make Nintendo suffer and we have seen a fraction of it in the last two years.

The Nintendo Switch is available since March 2017 and the company was aiming to sell 20 million units in FY 2018. Later, the analysts confirmed that the estimated hardware sales will not be more than 17-18 million. Although Nintendo didn’t reach its target, the growth in revenue was incredible in the last two years and the first financial year was very positive due to the release of the Nintendo Switch.

Now after completing two years in the market, most people who were interested in Nintendo Switch have bought it already. It clearly means that software and hardware sales will decline from this point. Its impact will be clearly visible on the company’s revenue in the next five years. The company, however, will not fail in this area because it will still be selling games which will benefit the revenue growth.

Keeping the overall growth of mobile gaming, Nintendo could possibly see growth in revenue at a higher rate. Nintendo now takes mobile gaming more seriously, but on the console, it is struggling to adapt to the market. Other consoles including the Xbox One and Sony’s PlayStation 4 have added a mix of games which is incredibly helpful for these two tech giants. Apart from their own big first-party titles, they have many console exclusive games and third-party titles which are enough to attract new buyers.

If you look at the list of the best selling video games, you will notice that most of them come from third-party developers. Many times Nintendo has promised that the company will add more third-party content to the Switch library, but the amount of content we saw in the last two years is not satisfactory. There are people who love playing old, classic Nintendo games on Switch, but in the long run, if Nintendo keeps following the same pattern, people who want fresh content will start distancing themselves from the console. Now, when media outlets and fans are talking about a new, improved version of the Nintendo Switch, being reliant on first-party games could badly hurt the company.

Nintendo’s Wii also struggled after it was launched. The hardware sales decreased significantly and Nintendo had no other choice than dropping the price many times. The fall in hardware sales will force Nintendo to invest money to increase its strength in software. The company will likely focus on mobile gaming as Nintendo is seeing significant growth in the mobile gaming business. But for the Nintendo Switch, it only needs some changes in its content strategy because the demand for third-party games is rising.

Staff Writer; Corey Shaw

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One Response to “Sales Expose Nintendo’s Biggest Weakness.”
  1. Benjamin Morgan says:

    I disagree. The Switch already has tons of third party games including Final Fabtasy , Elder Scrolls, Doom, and loads of Nindies that are very good games. With announcements like Resident Evil franchise games, additional Final Fantasy games as well as Cuphead it is hard for me to believe Nintendo isn’t attracting third party games.

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