December 8, 2008 / 12:10 PM / 10 years ago

Nintendo chief: man behind casual game boom

KYOTO, Japan (Reuters) - When Satoru Iwata became the president of Nintendo Co Ltd 7974.OS six years ago, the video game world was ruled by Sony Corp’s (6758.T) PlayStation 2 and populated by young men.

Iwata knew the market could be much bigger than that. Under his watch, Nintendo started inventing products for an unlikely crowd of gamers from pensioners eager to train their memory to yoga students perfecting their poses.

“Today there are people who play and who don’t. We’ll help destroy that wall between them,” Iwata said in May 2006 ahead of the year-end launch of the Wii console.

Unlike most consoles, the Wii is meant to appeal to everyone, whether their idea of entertainment is a tranquil round of golf or a battle with fantasy warriors.

“Regardless of age, gender or game experience, anyone can understand Wii,” Iwata said at the time.

His prediction proved accurate: The Wii turned into a bestseller and has consistently outsold its rivals. Global Wii sales came to 34.6 million units as of the end of September, against 16.8 million for the PlayStaion 3 and 22.5 million units for Microsoft Corp’s (MSFT.O) Xbox 360.

Iwata’s knack for unconventional solutions has marked his career, including his rise to the top at Nintendo, the world’s largest video game maker and creator of the well-loved game characters Mario and Donkey Kong.

He became president at 42, in a country where executives at major listed corporations tend not to make that step until their late 50s or early 60s, if not later.

Iwata’s predecessor, Hiroshi Yamauchi, a member of the founding family, picked him for the top job only two years after he joined the company. Yamauchi himself had held that position for more than half a century.

TEENAGE Programing

Iwata was hooked by computer programing at high school and studied computer science at Japan’s top technology university, Tokyo Institute of Technology. In 1982 he joined HAL Laboratory, a small game maker, only to watch it fail about a decade later.

Instead of leaving the firm in search of safer and better-paid work as a game developer, Iwata agreed to become its president and helped it return to profit.

He moved to Nintendo in 2000 and helped it launch the GameCube console the following year. The GameCube never really took off, however, overshadowed by the far more popular PlayStation 2.

Yamauchi recognized Iwata’s rare ability to understand both the hardware and software aspect of the game business.

That ability shows through in the Wii, which combines games for different age levels and interests with unusual hardware, such as a motion-sensing controller that can be swung like a tennis racket or a baseball bat.

Nintendo’s other bestseller, the DS handheld game player, also appeals to a broad fan base with software that includes puzzles, memory exercises and educational games, for example for learning Chinese characters.

Players can use a stylus instead of a key pad to operate the DS, something that appeals to people who are used to working with a pen but find key pads unfamiliar.


Helped by these features, the DS has outsold the PlayStation Portable two-to-one and is now encroaching on the territory of other gadgets.

Last month, Nintendo started selling a DS model that can take pictures and play music, taking on Apple Inc’s (AAPL.O) iPod and iPhone.

“We find ourselves at an unprecedented stage where one in every six people (in Japan) has a DS,” Iwata said at a news conference to unveil the new model.

“We will strive not only to appeal to those households without the DS, but to promote a shift to ‘one DS per person’ from ‘one DS per household’.”

Nintendo expects its operating profit to jump 29 percent to 630 billion yen in the year ending March, more than three times that of Sony.

Whether it can keep up that kind of trend in a global economic downturn remains to be seen — after all, even Iwata, now 49, acknowledges that Nintendo’s products are not strictly necessary.

“We are producing something people can live without. But we need to keep thinking what would make our products a priority purchase even if they are not a necessity,” Iwata said in October of this year.

“If we stop doing that, no matter how successful Nintendo is at the moment, things will start going wrong in no time.”

Reporting by Kiyoshi Takenaka; editing by Sophie Hardach

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