The Nintendo Switch's fast start may not be fast enough

When it comes to Nintendo's Switch, everyone seems to agree that it's off to a good start, with Nintendo hyping its first month sales results at every opportunity. And there's no two ways about it, those numbers are pretty good:

In the 12-month period ended March 31, Nintendo earned ‎¥‎489 billion ($4.4 billion) in revenue, slightly down on the ‎¥‎504 billion it earned in the previous year. However, net profit increased from ‎¥‎17 billion in FY2016 to ‎¥‎103 billion ($925 million), beating Nintendo's own forecast by 14%.

The company said that the difference was down to better than expected shipments of the Switch, which sold 2.74 million units in March alone. That figure was attained by Reuters, which attended a press conference with Nintendo CEO Tatsumi Kimishima in Japan. Kimishima said that the company expects to sell a further 10 million units in the current financial year.

So far, so good. Where I start to have issues with the hype, though, is when Nintendo start trying to draw parallels between the Switch's launch and that of their previous console success, the Wii:

According to Reuters, Kimishima said he was "relieved" by the console's early performance. "If the 10 million target is achieved ... that means the sales momentum would be close to the Wii," he said.

There's a problem with that comparison, though: the Switch is not the Wii, and the market that it's launching into is not the same as one that the Wii launched into.

Nintendo's Wii was a pop-culture phenomenon. Launching in 2006, at the start of its console generation alongside Microsoft's XBox360 and Sony's PlayStation 3, and prior to PC gaming renaissance, which didn't really get going until 2010, the Wii didn't have to vie for market share with established competitors. Everyone was starting from zero; no platform was coming into the year with tens of millions of customers who already owned huge libraries of compatible games.

The Wii had a couple of other features that gave it a competitive edge. One was its price point; the Wii was cheaper than its competitors. Its control scheme was also unique, and intuitively easy to use; children too young to read, and whose hands couldn't really wrap themselves around the standard XBox or PS3 gamepad, could still grasp and wave around the Wii's baton, as could older players who might suffer from, say, arthritis.

The elegance and simplicity of that interface also made it easy for non-gamers to use. You didn't have to know from experience which buttons normally did things in games, or work through a lot of tutorials to learn how to control the games. The result was a platform that could connect players from three to ninety-three; children could play with their grand-parents, allowing multiple generations of families to all equally access and enjoy gaming, really for the very first time in the history of video games.

The result was lightning in a bottle; people who Microsoft and Sony hadn't bothered to design for and market to were suddenly interested in gaming, connecting to and with the Wii in a way that they simply couldn't for the XB360 or PS3. Nintendo really couldn't make enough of them to keep pace with that early demand; stores couldn't keep the Wii on shelves. The only similar example of a game console success was Sony's PlayStation 2, which flew off shelves, in part, because it was also the cheapest DVD player on the market, in addition to being a game console.

None of that is really true of the Nintendo Switch, though. Gamers who'd previously discovered gaming thanks to the Wii have now outgrown it, and are demanding more variety and sophistication in their games, along with better performance. The gimmicky control scheme of the Switch isn't really a selling point, either, with many Switch owners ditching their Joy-Cons for the Switch's Pro controller's better ergonomics. 

Unlike the Wii, where the quality of the unit was at least comparable to that of its competitors, the Switch looks and feels cheap, with a plastic screen that gets scratched by its own included dock, controllers that need extra insulating foam installed in order to work properly, and inadequate storage that make it essentially incompatible with the digital distribution that is taking over the industry... the issues just keep coming.

And while none of these might have been crippling if the Switch were launching onto a level playing field, the market that it's launching into isn't a level playing field. Thanks to Steam's 125 million users, PC (which wasn't a factor when the Wii was launched) is dominant in the current market, and Sony's PlayStation 4 isn't just outselling the XBox One, it's also still outselling the Nintendo Switch:

Sony Interactive Entertainment sold 20 million units of its PlayStation 4 console in the last fiscal year, boosting revenue by 6% and operating income by more than 50%.

[...] 

Across the entire year, 20 million units of the PS4 were shipped, 13% more than the 17.7 million units in the previous fiscal year. Given that the PS4 had 40 million confirmed sales in May 2016, that puts the total PS4 installed base somewhere around 60 million - possibly just below, but certainly not very far away.

[...] 

Looking ahead, Sony expects PS4 shipments to decline to 18 million next year. However, it expects the GNS division to improve in general, with a 14.6% increase in revenue and a 34% increase in operating income.

Remember, Nintendo are saying that they'll be thrilled to sell 10M units in 9 months, a pace of roughly a million units a month on average; Sony, on the other hand, are forecasting sales of 1.5 million units per month for the same period, and that's down slightly from the PS4's sales performance of the previous year. Sony are starting with a 60 million lead in player base, and will probably increase that lead even if Nintendo's Switch performs as well as Nintendo is hoping.

At this point, it's worth remembering that the WiiU had a player base of 13 million when it was discontinued, because developers couldn't be bothered to make games for its different OS and weird control scheme when it didn't have even half as many users as the XBox One... which itself still has only half as many users as the PS4. And the only game of note that the Switch has going for it right now is Zelda; yes, ports of Skyrim and Shovel Knight will probably sell reasonably well to Switch owners who have nothing else to play and a desire to justify their Switch purchases, but ports of games that most interested gamers already own on other platforms aren't going to sell Switches to the skeptical.

And when it comes to Nintendo's own new-game releases for the Switch... is the obligatory new Mario game going to be a better system seller than Breath of the Wild? Will anyone care about the new Mario game that doesn't already own the Switch? Are gamers really desperate enough for gimmicky tech demos like Arms to drop hundreds of dollars on a new console just to get them?

I know that Nintendo fans (and shareholders) have a lot of hopes pinned on the Switch changing Nintendo's fortunes in the highly competitive gaming market, but... how does that happen, exactly? Unless the Switch suddenly starts selling faster than the PS4, fast enough to regain some of the ground that Nintendo lost with the failure of the WiiU, I just don't think that the Switch can ever have anything like the momentum of the original Wii.

And, failing that, I don't see how the Switch does anything but follow the WiiU into irrelevance and eventual obscurity.

[Quotes from gamesindustry.biz.]

No, consumers really didn't like the Kinect

I just read this bit of revisionist history on HuffPost Tech, courtesy of Reuters:

Consumers liked Kinect, but it never lived up to its full potential, in part because it spawned no blockbuster games. Microsoft failed to persuade top gaming studios to invest seriously in Kinect, developers say, and by 2014 it was no longer being included with Xbox consoles.

That's a lovely story. Just one problem... that's not what happened.

Critics and reviewers liked the Kinect, yes. Some of them even liked the XBox One version, which was on all the time and reporting what it saw and heard back to Microsoft even when your XBOne was "off," praising it's camera quality and fast response time, among other things. But consumers didn't take to the Kinect, either on the XB360 or the XBOne. That's why the AAA studios weren't making games for the thing... there were no users to whom they could've sold those games, even if they'd made some.

That may have been partly why Microsoft were so keen to bundle the Kinect with the XBOne, back when they were still selling XBOne as the device which was going to take over your living room, and control all your devices, while downplaying games as the main use of the device... a disastrous marketing strategy which Sony capitalised on, allowing them to clean XBox's clock in this console generation, outselling them two to one.

It certainly didn't help, though, that Kinect on XBOne had other issues besides a near-total lack of games that made use of the thing:

Prior to Xbox One's launch, privacy concerns were raised over the new Kinect; critics showed concerns the device could be used for surveillance, stemming from the originally announced requirements that Xbox One's Kinect be plugged in at all times, plus the initial always-on DRM system that required the console to be connected to the internet to ensure continued functionality. Privacy advocates contended that the increased amount of data which could be collected with the new Kinect (such as a person's eye movements, heart rate, and mood) could be used for targeted advertising.

Reports also surfaced regarding recent Microsoft patents involving Kinect, such as a DRM system based on detecting the number of viewers in a room, and tracking viewing habits by awarding achievements for watching television programs and advertising. While Microsoft stated that its privacy policy "prohibit[s] the collection, storage, or use of Kinect data for the purpose of advertising", critics did not rule out the possibility that these policies could be changed prior to the release of the console.

Concerns were also raised that the device could also record conversations, as its microphone remains active at all times. In response to the criticism, a Microsoft spokesperson stated that users are "in control of when Kinect sensing is On, Off or Paused", will be provided with key privacy information and settings during the console's initial setup, and that user-generated content such as photos and videos "will not leave your Xbox One without your explicit permission."[19][20][21][22] Microsoft ultimately decided to reverse its decision to require Kinect usage on Xbox One, but the console still shipped with the device upon its launch in November 2013.[9]

The decision to still ship XBOne with Kinect added $150 to the price tag, for a device that consumers had never taken to, and which now came with a freight of Orwellian PR, a combination which sunk the platform; Microsoft would eventually backtrack on their claim that Kinect was "essential" to the XBOne experience, and ship a SKU with no Kinect in the box, but the damage was done: PlayStation 4 was already well ahead, and Microsoft would never get close to Sony again in console unit sales.

And yet, Reuters is still claiming that consumers "liked Kinect," in spite of the fact that Microsoft has released it twice, only to have consumers refuse, en masse, to buy the thing. No. Just.... no.