Super Mario Run — Nintendo’s first official foray on to the mobile platform (Pokemon Go doesn’t count) — has broken mobile gaming records but investors aren’t sure what to think.
The game has smashed download records according to analysts, hitting 25m downloads in just four days after it was simultaneously released in 151 countries last week, but the surprisingly high price has left investors scratching their heads over how Nintendo will convert downloads into cash.
Investors have backed out of Nintendo stock, sending it to a one month low after media hype around the newest Mario game pushed it up in recent months. Nintendo shares have lost 11 percent since the launch.
The princess-rescuing Italian plumber — which many analysts see as arguably the most popular gaming franchise in the world — currently has a 2.5 average rating on Apple’s App Store, with users complaining about the game’s $9.99 one-time cost, a break in mobile gaming tradition that has pioneered the so-called freemium model where users pay smaller amounts special features.
Nintendo’s march on to mobile
Nintendo was hesitant over the smartphone gaming market amid concerns it could cannibalise its core console gaming business but the poor performance of its Wii successor, the Wii U, prompted a re-think.
It took the roaring success of Pokemon GO — based on Nintendo characters but only barely a Nintendo creation — reaching some 25m downloads in a now seemingly slow 11 days from around 35 countries via both Google’s and Apple’s app stores. And though Nintendo said Pokemon GO would have little direct impact on its bottom line it’s propelled the Pokemon franchise back to global popularity and introduced an entirely new generation to to the craze.
Pokemon players have drifted away from the game at what could be seen as a worryingly high rate in the five months since its release, though as of October it was reportedly still bringing in around $2m per day.
This pales in comparison to the $100m boost Nintendo’s operating profit Pokemon Go gave the Japanese company between July-September, according to research company SuperData.
SuperData is forecasting the latest Mario game will generate as much as $15m in its first month. However Nintendo has repeatedly said profit was not the only focus of its smartphone business.
Late Nintendo president Satoru Iwata — who passed away in July 2015 — was a fierce critic of mobile gaming titles that charged for premium features which he said promoted addiction. Players and investors are clearly sold on this model however.
Iwata’s strategy, which Nintendo seems to be sticking to, was for smaller profit than might be possible from a freemium model but a large user base. Nintendo plans to build up a huge user base on mobile and bridge them to costlier console gaming.
The purpose of both Super Mario Run and Pokemon Go is to create buzz and boost public awareness, something Pokemon easily achieved, introducing Pikachu and co to a whole new generation of fans.
While a lot of mobile gaming companies have a some serious success, they have struggled to build up a loyal brand following and some of the biggest games makers have not been able to replicate earlier successes.
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But the mobile channel isn’t going anywhere. It’s barely gotten started.
The number of mobile users is still expected to grow considerably in just the next few years, making this already massive market even bigger.
The Mario game isn’t available yet on Alphabet’s Android operating system, which will likely give it another surge when it debuts next month.
While poor reviews might hurt mobile Mario’s long term performance Nintendo has succeeded in dominating the conversation. We now need to see what impact Super Mario Run has on sales of console game.
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