Friday, March 4, 2011

Iwata to GDC: Smartphones are Evil, Content is King

Satoru IwataNo city has mattered more to gaming this week than San Francisco. The Game Developer’s Conference (“GDC”) summoned the industry’s brightest minds to the Bay Area to co-mingle, cohabitate, and congratulate one another on the past year.

GDC distinguishes itself from the Electronic Entertainment Expo’s booth babe bonanza by focusing not only on gaming’s future but its past and present. There are booths and developers will demo their newest games, but it’s the keynotes, panels, and discussions that dominate the calendar (that and the increasing presence of the Independent Games Festival).

This year’s keynote, titled “Video Games Turn 25: A Historical Perspective and Vision for the Future,” was delivered by Nintendo’s president Satoru Iwata. It’s the 25th GDC, and given the recent 25th anniversaries of Super Mario Bros. and The Legend of Zelda, Nintendo could not be more relevant to the occasion. Also, Iwata’s professional career began with the Nintendo subsidiary HAL Laboratories, and he joined Nintendo proper in 2000. The only person more qualified to speak would have been Shigeru Miyamoto himself.

So what does Iwata think of the industry he helped create? It’s unstable.

Heavy Lies The Head…

“Content is king,” Iwata declared, displaying a quote from Time Gate Studios’ Adel Chaveleh. Iwata repeated Chaveleh’s words like a mantra throughout the speech.

It should come as no surprise that Nintendo’s president would hitch his wagon to that horse. Iwata said he learned this lesson years ago when Miyamoto’s games greatly outsold his own, which Iwata believed to be “technically superior.” Nintendo’s last two systems shied away from technical dominance and embraced interactivity and content, and it’s worked out for the company. Compare the sales of the Wii and the DS (80 million and 140 million worldwide, respectively) to that of Microsoft’s Xbox 360 (50 million as of last month).

Iwata’s worried we’re losing sight of this axiom. Advances in technology are ballooning development costs. “Today many gamers demand titles that cost $50 million or more,” said Iwata. Thankfully, the growing gaming audience (which, of course, Nintendo helped to create) is offsetting some of those costs.

And what do they want? Social games.

There’s Social, And Then There’s Social

farmville“People talk about social network games and social games. I believe these are two very different things,” said Iwata. He argues that social gaming is older than the Internet, dating back to at least Spacewar (I have no argument there).

Wisely, Iwata went on to describe how a number of developers – including but not limited to Nintendo – helped foster social gaming with games like Tetris, Pokémon, Call of Duty, World of Warcraft. He even acknowledged the success and importance of Xbox Live, a service that provides an online experience superior to Nintendo’s.

Games and features like these excite gamers, Iwata said, creating “must-have” experiences. He name-checked everything from the Game Boy to Angry Birds, defining a “must-have” as something a gamer wants to avoid feeling left behind. Not owning a “must-have” is akin to having nothing to say at the proverbial 1990s water cooler because you missed yesterday’s Seinfeld (my words, not Iwata’s).

This “must-have” idea of Iwata’s is social in nature. The very act of keeping up with the Joneses requires a relationship between you and the Joneses. He also name-checked the ultimate “Keeping up with the Joneses” game: The Sims. “Many of you predicted it would never find an audience because there was no way to win or lose,” said Iwata, who then pointed out that Will Wright’s blockbuster series has sold 125 million units.

Like It, Love It, “Must-Have” It

63771327Nintendo hopes it’s next handheld, the 3DS, will be one such “must-have.” After expressing his company’s dream of everyone carrying their 3DS wherever they go, Iwata cleared the stage for Reggie* Fils-Aime, president of Nintendo of America. Fils-Aime proceeded to sell the 3DS hard, highlighting features like Netflix support and an expanded eShop.

It’s worth noting that, across the street from GDC, another “must-have” device was being discussed: the iPad 2. Apple’s formal announcement took place just minutes after Iwata’s keynote.

The emergence of iOS as a profitable gaming platform threatens Nintendo’s stranglehold on the mobile market. And while the iPad is less of a competitor to Nintendo than the iPhone, Apple’s mere presence across the street surely raised the hairs on the back of Iwata’s neck.

Iwata returned to the stage after Reggie’s time was up, grabbing everyone’s attention with the announcement of a Super Mario game for the 3DS and a trailer for the upcoming Zelda game, Skyward Sword.

He then returned to the concerns he raised at the speech’s start. All are related to game quality. Oversized game development hurts craftsmanship. How can a developer finely hone a game when its size makes it hard to finish at all? Specialization breeds excellent programmers as well as narrow-minded developers. “It makes me wonder where the next great game creators will come from,” said Iwata.

His third concern addressed Apple and its smartphone ilk. “Is making high-value games a top priority, or not?” he asked.  Iwata drew a line in the sand:

“The objectives of smartphones and social network platforms are not at all like ours. For them, content is something created by someone else. Their goal is just to gather as much software as possible because quantity is what makes the money flow. Quantity is how they profit. The value of videogame software does not matter to them.”

“Innovation” will succeed, Iwata said. “Is there something we consider impossible, that we can make possible?”

The Discontent King

nintendo 3dsIwata seems keenly aware of the changes facing the gaming industry. Nintendo rocketed to success in an era where console entertainments differed vastly from their computer counterparts. That gap isn’t so wide anymore. So Nintendo furthered differentiated itself from the competition by leading the motion-controller charge on the Wii.

But now motion-control is everywhere. And even more ubiquitous is its Apple-supported cousin: the touch interface. Touchscreens may never be able to provide the same complexity as a traditional controller, but the millions of people playing Angry Birds, Fruit Ninja, and Cut The Rope don’t seem to mind. Nor do the millions signed up for free-to-play social networking games like FarmVille. For them, smartphones and tablets represent an easier way to click cows with their friends. These games are cheap to make and cheap to play. Neither of which fit into Nintendo’s business model (unless you count the scores of nonsense littering its DSi and WiiWare shops).

I’m only half-surprised that Iwata filled out the middle of his address with a commercial for the 3DS. On the one hand, there’s something about the GDC that feels like its keynote shouldn’t have been a marketing platform for a company whose flagship console has begun to flag. On the other, including the 3DS in Iwata’s argument makes it appealing to anyone who the audience who agrees with him. Not a bad move when its an audience of developers eager to sell their games.

Iwata’s ire is ironic, given how much he credits Nintendo with the expansion of the gaming populace. The “blue ocean” of soccer moms and elderly that Nintendo chased with the Wii are the same people buying 99-cent games for their phones. A clear case of “Be careful what you wish for” if there ever was one.

Now Iwata’s wishing we’ll embrace the 3DS. How it sells – and the quality of its content – will show whether this keynote was a successful salvo fired by gaming’s biggest company or an ineffectual rant by a fretful founding father.

[Quotes pulled from various liveblogs of the event: Kotaku, Ars Technica, Joystiq.]

* With all of the “King” talk, it took a lot of self-restraint not to make any jokes involving Reggie Fils-Aime and regicide.