Presentation - 2012 E3 Analyst Q & A Session

2012 E3 Analyst Q & A Session - June 6, 2012

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15-1	You have described some benefits of the Wii U GamePad being fully integrated in the Wii U, in comparison with a smartphone connected to a TV through software. It may be hard for consumers to initially grasp the differences related to latency and lag until they actually use it. Looking back to when you launched the Nintendo 3DS, you, in retrospect, described a problem where you could neither market it well enough nor offer enough opportunities for consumers to have hands-on experiences, and so the full benefits of the Nintendo 3DS weren’t apparent to consumers immediately. How do you plan to change or adapt your marketing strategy this time around to ensure that consumers understand the key benefits of the Wii U?
15-1	Iwata: That is something that Reggie and I have to discuss deeply, isn’t it? Even here at the E3 show, I would say that the way we introduced its unique game play hasn’t been absolutely perfect because although we do have people who have responded very positively to the Wii U, we also have some who are still somewhat skeptical of it. Through this E3 show, we have learned about what elements of the hardware have been easily conveyed to people and what elements have not. We will leverage what we have learned and apply it to our marketing as we move forward into the launch phase. So today I unfortunately can’t go into specific detail on precisely what we have planned, but I can say that we do intend to go to great efforts to ensure that people really understand the value proposition and the appeal of the Wii U hardware. Reggie: It’s interesting how people look back to 2006 when we first introduced the Wii and recreate a perspective that the Wii’s success was guaranteed right after this E3 type of event back then. The point in fact is that when we first showed the Wii, we had similar reactions to what we are experiencing with the Wii U. The performance vector for the industry was based on graphics and processing power. The idea of having a motion-based remote was unique and innovative. Other video game manufacturers quickly tried to dismiss what we were doing by saying, “The same thing would be possible if you coupled our hardware with some other device.” But the point was, as we received more consumer information, and as we continued to hone our marketing, what we were able to do was create global launch strategies that led to wide acceptance by our consumers. That is exactly the situation we find ourselves in today. We are finding a very good response to key pieces of software and key parts of our messaging. We are tracking all of this information for the time when we do announce the launch details, such as the launch price and the launch date, so we will be able to apply all of that learning and hopefully recreate the same type of situation we had in the holiday of 2006 as we look forward to the future.

15-1

You have described some benefits of the Wii U GamePad being fully integrated in the Wii U, in comparison with a smartphone connected to a TV through software. It may be hard for consumers to initially grasp the differences related to latency and lag until they actually use it. Looking back to when you launched the Nintendo 3DS, you, in retrospect, described a problem where you could neither market it well enough nor offer enough opportunities for consumers to have hands-on experiences, and so the full benefits of the Nintendo 3DS weren’t apparent to consumers immediately. How do you plan to change or adapt your marketing strategy this time around to ensure that consumers understand the key benefits of the Wii U?

15-1

Iwata:

That is something that Reggie and I have to discuss deeply, isn’t it? Even here at the E3 show, I would say that the way we introduced its unique game play hasn’t been absolutely perfect because although we do have people who have responded very positively to the Wii U, we also have some who are still somewhat skeptical of it. Through this E3 show, we have learned about what elements of the hardware have been easily conveyed to people and what elements have not. We will leverage what we have learned and apply it to our marketing as we move forward into the launch phase. So today I unfortunately can’t go into specific detail on precisely what we have planned, but I can say that we do intend to go to great efforts to ensure that people really understand the value proposition and the appeal of the Wii U hardware.

Reggie:

It’s interesting how people look back to 2006 when we first introduced the Wii and recreate a perspective that the Wii’s success was guaranteed right after this E3 type of event back then. The point in fact is that when we first showed the Wii, we had similar reactions to what we are experiencing with the Wii U. The performance vector for the industry was based on graphics and processing power. The idea of having a motion-based remote was unique and innovative. Other video game manufacturers quickly tried to dismiss what we were doing by saying, “The same thing would be possible if you coupled our hardware with some other device.” But the point was, as we received more consumer information, and as we continued to hone our marketing, what we were able to do was create global launch strategies that led to wide acceptance by our consumers. That is exactly the situation we find ourselves in today. We are finding a very good response to key pieces of software and key parts of our messaging. We are tracking all of this information for the time when we do announce the launch details, such as the launch price and the launch date, so we will be able to apply all of that learning and hopefully recreate the same type of situation we had in the holiday of 2006 as we look forward to the future.

15-2	During the presentation, you described the key differentiating feature of game play on the Wii U as being “asymmetric” gaming. From what I saw, it seemed like only one or two titles really incorporated true asymmetric game play, where people compete against each other. When would you expect that majority of the first-party titles might incorporate this asymmetric gaming?
15-2	Iwata: When multiple people are playing together on the Wii U and you have one user playing on the Wii U GamePad and the other users playing on the traditional Wii Remotes, it changes the roles that those players can perform within a game. As you have the opportunity to change the roles that players are performing, that is going to naturally lead to new ideas from game designers, who will then offer asymmetric game play. Even in these early stages, we have hit upon a number of different potential ideas, so we see that the structure has the potential to bring many new ideas. We will initially introduce what kinds of game experiences you can have with one Wii U GamePad until we are able to fully utilize the structure, and then you will start to see more and more games from us that are taking advantage of asymmetric game play other than the titles you have seen this time. Since we are focusing on “Nintendo Land” as one example of that style of asymmetric game play here at E3, you might feel you have seen few titles. (In fact, there are some elements of asymmetric game play in the Wii U software titles like “New Super Mario Bros. U,” “GAME & WARIO” and “SiNG” - all of which were shown in this E3 show.) We will develop a marketing strategy for the Wii U launch to ensure that consumers know a number of games leveraging asymmetric game play will be coming.

15-2

During the presentation, you described the key differentiating feature of game play on the Wii U as being “asymmetric” gaming. From what I saw, it seemed like only one or two titles really incorporated true asymmetric game play, where people compete against each other. When would you expect that majority of the first-party titles might incorporate this asymmetric gaming?

15-2

Iwata:

When multiple people are playing together on the Wii U and you have one user playing on the Wii U GamePad and the other users playing on the traditional Wii Remotes, it changes the roles that those players can perform within a game. As you have the opportunity to change the roles that players are performing, that is going to naturally lead to new ideas from game designers, who will then offer asymmetric game play. Even in these early stages, we have hit upon a number of different potential ideas, so we see that the structure has the potential to bring many new ideas. We will initially introduce what kinds of game experiences you can have with one Wii U GamePad until we are able to fully utilize the structure, and then you will start to see more and more games from us that are taking advantage of asymmetric game play other than the titles you have seen this time.

Since we are focusing on “Nintendo Land” as one example of that style of asymmetric game play here at E3, you might feel you have seen few titles. (In fact, there are some elements of asymmetric game play in the Wii U software titles like “New Super Mario Bros. U,” “GAME & WARIO” and “SiNG” - all of which were shown in this E3 show.) We will develop a marketing strategy for the Wii U launch to ensure that consumers know a number of games leveraging asymmetric game play will be coming.

16	I understand for the Wii, Mr. Miyamoto designed a system with about five or six key titles in mind: “Wii Sports,” “Wii Sports Resort,” “Wii Music” and several others. Has something similar occurred this time? So far, obviously we’ve seen “Pikmin 3,” but is there a similar strategy of a range of titles that he is playing a role in to create that is the plan for the next two or three years for the Wii U?
16	Iwata: First, what we’ve shown at the E3 show are both the launch titles that will be released with Wii U hardware this holiday season and the launch window titles that will be released early next year or not long after the hardware launch. We do have ideas of what kind of software we will be releasing after those two periods, and Mr. Miyamoto as well as I are both directly involved in the development process. Those include both our traditional franchises and of course new propositions as well. However, because we are now in the era when similar proposals can be made by the others just one year after we introduced a brand-new hardware system proposal, please understand that we really can’t say much about what else we are planning.

I understand for the Wii, Mr. Miyamoto designed a system with about five or six key titles in mind: “Wii Sports,” “Wii Sports Resort,” “Wii Music” and several others. Has something similar occurred this time? So far, obviously we’ve seen “Pikmin 3,” but is there a similar strategy of a range of titles that he is playing a role in to create that is the plan for the next two or three years for the Wii U?

Iwata:

First, what we’ve shown at the E3 show are both the launch titles that will be released with Wii U hardware this holiday season and the launch window titles that will be released early next year or not long after the hardware launch. We do have ideas of what kind of software we will be releasing after those two periods, and Mr. Miyamoto as well as I are both directly involved in the development process. Those include both our traditional franchises and of course new propositions as well. However, because we are now in the era when similar proposals can be made by the others just one year after we introduced a brand-new hardware system proposal, please understand that we really can’t say much about what else we are planning.

Presentation | Q & A

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