Two years later, Hiroshi Yamauchi doesn't sound so crazy.

[Julius Seeker]

"The DS represents a critical moment for Nintendo's success over the next two years. If it succeeds, we rise to the heavens, if it fails, we sink into hell." -Hiroshi Yamauchi in 2004.

The following is more or less just my response to the quote, there isn't really any new information in it:

At least speaking for Japan, Nintendo has been the #1 company for the past year and a half; almost all thanks to the DS until just recently with the Wii release. In North America, during November, all three systems, GBA, Wii, and DS sold well, and have continued to sell well into December; of course, with DS being far and beyond the #1 system in North America. The DS has also seen great success in Europe as well: its top selling game being Nintendogs which has sold over 5 million copies. This weekend in the UK, the DS sold 110,000 units.

As it seems, the DS concept seems to have transfered over into the home console popularity surrounding the Nintendo Wii has well. As it currently stands, the Wii sits as a solid #2 next to the DS in the videogame market. Whether it will surpass DS or not, in the near future, remains to be seen.

In Japan a major loss to the Playstation brand turned out to be a major gain for the DS brand. The Dragon Quest series has been moved over from Sony Playstation to Nintendo DS. Beginning with the release of Dragon Quest 9; a game which will offer some features not before seen in the series including online play.

So in effect, it seems Yamauchi spoke prophetically. Nintendo does seem to be rising to heaven (yes, this is an allegory); as it has secured itself this holiday season as a distant #1 in the videogame industry; and this is mostly thanks to continued huge success of DS, great success of the GBA, and the launch of the Wii. Of course, this just answers the question for the holiday season of 2006. The real question won't be answered for another year; Who will be in first place through this generation of consoles?

My prediction: Nintendo will remain first, Xbox 360 will pass Sony and become #2 before the end of the year (Sony still has the PS2 as a factor). I also predict that developers are going to treat Wii similarly to the DS: one major complaint that developers had about the PSP was that development costs were too high and that the DS was a more attractive option. Already Ubisoft and Electronic Arts have spoken out on this issue in regards to the new generation of home consoles (Electronic Arts said that they need to sell 500,000 copies on their PS3 launch titles just to break even). I predict that due to this, a lot of companies will shift focus towards the DS and Wii (since it has been off to such a great start).

[Zeus]

Seek, nothing means anything 'til next year if you care about the figures. DS, PS2, and GBA are leading the pack right now and 360 outsold both the Wii and PS3 in November. But until the flow is steady from Nintendo and Sony and the games start coming out regularly, the figures won't nominalize, and that won't happen 'til closer to the summer

I'm still waiting on the Wii's appeal in the masses. I've seen a lot of people interested and intrigued, but we'll see how that translates to long-term sales. Even the GC had a good first 6 months but it died off. We'll see if the Wii is a flash-in-the-pan niche system or if it truly does achieve the long-term success of the DS. I very much enjoy mine, but that don't mean it's going to be a long-term success

And, as crazy as Yamauchi was, he also dragged the entire industry into the mainstream. The man did know what he was doing the vast majority of the time.

[Julius Seeker]

Seek, nothing means anything 'til next year if you care about the figures. DS, PS2, and GBA are leading the pack right now and 360 outsold both the Wii and PS3 in November.

That is only due to Wii and PS3 being available for one week. NPD tracks sales until the last Sunday of the month; October 30th-November 26th. In the US, Nintendo still sold 2.1 million of the 3.2 million systems sold. Which puts them far into first. PS2 might remain strong for longer than most people think. I expect Xbox 360 sales to decline next year, particularly due to them falling so short of their target this year.

As for who leads the pack, the DS is far in first place, and has been there for quite a while now, in all three markets.

Wii obviously is much more popular than Gamecube was at launch. It has already sold quite a bit faster. Gamecube was not selling out within seconds after each shipment either.

The DS vs PSP argument is a good indication of how the Wii vs. PS3 argument will carry out. Most notably, read some of EA and Ubisofts interviews on Wii and PS3, and then look at other company interviews early on dealing with DS and PSP. The major thing for them is that dev costs are lower for the DS and Wii. EA stated that they need to sell approximately 500,000 copies of each of their PS3 launch titles in order to break even. As of now, Playstation has lost two major series, SSX and Dragon Quest.

[Don]

Handheld and console aren't remotely the same thing. Nintendo has held the handheld market fine while being destroyed in the console market. Likewise Playstation's commanding lead in the console does not translate to a successful PSP.

[Julius Seeker]

Handheld and console aren't remotely the same thing. Nintendo has held the handheld market fine while being destroyed in the console market. Likewise Playstation's commanding lead in the console does not translate to a successful PSP.

I don't agree.

The Playstation brand name did help the PSP sales quite a bit in the early run, if you recall, PSP was initially the #1 system, but the success dropped off once it became clear that the DS was getting all the good games.

The Wii also had a much more successful launch than the Gamecube. The Wii's success can be attributed to the popularity of the DS rather than the popularity of the Gamecube. In the end though, it is the marketing and games that are going to sell the system, but the first months of success will be due to the Nintendo/Sony brand name popularity. In Japan, currently, Nintendo is a larger brand name. The polls that I have been posting over the past year have reflected that.

Just my opinion though.

[SineSwiper]

I think the one major problem with the Wii that will hurt long-term sales is the technology of the Wii. How can you design a next-gen system that isn't even HDTV quality? Do you know how many people have HDTVs already?

[Kupek]

Don, we all had argued about the handhelds-are-not-consoles with Seeker before, but I think we're now seeing evidence that, at least in Japan, the DS is replacing console gaming as opposed to supplementing it. The biggest indicator of this is DQ9 going to the DS. The DQ series has always gone to the console with the largest base: NES, SNES, PS and then PS2. The fact that Square-Enix chose the DS over any of the other consoles is telling.

I do realize, however, it might be a strategy on the part of Square-Enix to avoid putting their two big franchises (DQ and FF) in direct competition with each other.

[Zeus]

I do realize, however, it might be a strategy on the part of Square-Enix to avoid putting their two big franchises (DQ and FF) in direct competition with each other.

Why would they need to do that? They're not released the same year anyways and it's not like it's a hard thing to stagger the releases so they have one one year and the other the subsequent year. Look at DW8 and FF12. They're not really in competition, they're more complementing each other.

This is based on three things IMO:

1) Userbase - DS will have both the PS3 and the Wii owned in terms of userbase next year

2) Style of game - DW has never been about graphics, FF has. DW could easily make the transition whereas FF would lose a lot

3) Development time/money: much lower costs for a handheld with a much higher userbase and little loss of what makes the game what it is? Pretty big incentive there, particularly if you expect to move more units