Nintendo, Sony, and Microsoft Have You in the Palms of their Hands

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[This is a guest post from one of our senior forum moderators, Matt Costello. Get to know him in person on the forums. (Mattavelle1)]

I have a theory. Just a theory, but bear with me. This theory of mine is more about control, money, and manipulation than anything else (but I\’ll run the gauntlet, as this involves many interrelated topics).

About 6 months ago, I went to visit my in-laws, wife and child in tow. I\’m actually really tight with my father-in-law (henceforth known as FIL), despite not having anything in common with him. Well, except for a few things (which we found out in due course). Before I married into this family, I didn\’t know the first thing about the stock market, whereas my wife’s side of the family was deep into it. Despite being a blue-collar guy with no high-school degree, FIL is quite brilliant at the trade. I wasn\’t raised in a stock-trading family, but FIL’s father-in-law (my mother-in-law’s father) taught him all about it, so there’s our connection.

So I\’m sitting in the living room with FIL, and we were talking and watching the ticker on the TV (still not something that excites me), when something on the screen catches my eye. FIL stops the conversation and says, \”This guy is really sharp. If you want to know what moves to make in the video game market, you\’d best listen to him.\” Who is this, allegedly the sharpest tool in the shed? Michael (expletive deleted) Pachter. I can\’t help but reply, \”Him!? What is he doing on TV, anyhow?\” FIL proceeds to ramble off some official-sounding jargon, but he’s mostly engrossed with Pachter’s conversation on TV. So I perk up and listen in.

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And now, down the rabbit hole. I\’m a gamer, FIL is a 70-year-old pensioner with a knack for the stock market, and our worlds collide with Pachter, who we both understand in completely different ways. My understanding of him is generally \”OMG, not this guy again, lulz\” (you would think someone so wrong so often would have \”troll\” listed as his profession, not \”analyst\”). But FIL? He knows him through…well, official-sounding jargon. To paraphrase the Pachter spiel on the television:

\”So, Mr. Patcher, how is this holiday season going to shape up for investors?\”

\”Well, my big money is on Gamestop, who should really haul it in during the holidays. They\’ll be selling two new consoles coming to the market and pre-orders are already full. They also have the one-year old Wii U in stores which, despite their struggles, still have some heavy-hitting games coming at the end of the year and should do OK. Gamestop will be the place where consumers can easily find all of this, and as we have seen in Christmas-after-Christmas, video games dominate this time of year.\”

(Cunning analysis, Michael. MIND BLOWN.)

I\’m so conflicted right now that I\’m not sure what to say or do. Pachter’s prognostications are too often wrong, but right then he made total sense when talking to White Rich America (I would also put my money on Gamestop this holiday season). But what if that news came to us via online message boards? It would be: \”Patcher is at it again, not even picking a videogame company – this ass clown picked GAMESTOP, of all things.\” Same message, but shone through the prisms of two different audiences. This is where my mind really starts to take off, and while trying to put these conflicting views together, my mind wanders deeper. If you\’ve read this far, thanks, but you really just took the red pill. Down the rabbit hole we go.

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The console wars? Total bull. 100% total unadulterated bovine excrement. If the console wars were so important and so big for investors this holiday season, why was it not brought up between four people at that moment on TV? Wouldn\’t this be worth noting? Perhaps not, if the only thing that matters is the almighty dollar. Which it is. It’s business to them, but that business interest can make even more money if you, the gamer, are being made to feel like you have to pick a side (lest all be lost!). \”They\” have found their pot of gold, and your hobby is no longer made for fun. No, you are a part of them making money. It’s just a question of wringing out the greatest possible sum.

Let’s take a step back through history, shall we? A lot of this is going to hinge on Nintendo, because this is about money, and the folks in Kyoto have almost always known how to run a profitable company. Before Sony and Nintendo’s acrimonious split (which led to the PlayStation’s very existence), gaming was an \”in your mom’s basement\” hobby (you\’ve heard it all before). But that split was the beginning of the death of gaming as we knew it, as an innocent hobby. Oh sure, you had some Nintendo vs. Sega gamesmanship back then, but the level of vitriol was nothing compared to today (to be certain, the internet has helped perpetuate this, but I don\’t think it fully explains it). This gave business interests the chance to gin up new revenue, upping the stakes of the \”console wars.\” How? A new media cottage industry helps. There may have been plenty of playground taunting before, but for the first time we saw thinly-veiled trolling. Peal away the veil, and magazine articles were little more than \”Sony takes a crap in Nintendo’s back yard,\” or \”Nintendo puts nail in Sony’s coffin with higher-graphic machine and analog stick.\” The sticks and stones were spread amongst many articles, but if you were there (reading the rags of the day, EGM, GamePro, etc.), you probably remember the jabs.

Call me crazy, but I believe that this is the point when other business interests began to see the potential of videogames as more than a hobby for children. Controversy sells, everyone likes a good fight, and a good fight can generate a lot of money for someone. In this respect, the \”console wars\” became the best thing to ever happen to gaming, but not for us gamers. No, it helped out the bottom line of certain businesses, as we fans were not only paying for a certain console, but for all of the extras and swag we buy. But above all, they got something much more valuable – our time. We gave them the time that we spend generating content on message boards via the controversy peddled to us, creating a feedback loop that props up gaming sites around the web (and to larger firms that watch this combative market with great interest, allowing them to dispense advice to FIL and his friends).

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Just look across the web at what they have done to a hobby. GameSpot’s parent company is CBS. Up until February of this year, IGN was owned by News Corp. Is it any surprise that companies steeped in Western media have given us \”news\” that wouldn\’t feel out of place on nightly cable news? It’s more entertainment than news (via companies with a lot of interest in entertainment), designed for page clicks and repeat views. It’s just another dose of what Western media has become (CNN isn\’t just CNN, it’s owned by Time Warner, who seem hell bent on bringing you the most violence and scandals that you can fork into your eyeballs), and as sites like IGN go, so goes their forums. And we wonder why it’s billed as a \”war\” out there? That war keeps the attention on media companies, and with attention on those companies, that means more revenue for their stocks. With more revenue in the stock market, it means that your hobby is going to suffer in more ways that you can imagine, because now these guys have a hand in calling the shots. Think it’s a surprise everyone wants the next CoD? GTA? Mario? These corporate/non-gamer interests control what you\’re going to get. They heavily market CoD and sell 100 million copies? Then you\’re going to be offered 100 million knock-offs in the FPS genre. But it also bleeds into who you\’re going to encounter and spend time with online. Fanboys and trolls are sobriquets we\’ve made on our own, and business interests LOVE you and me for doing it. Not only did we create little \”teams,\” but we come back to forums to argue the \”other\” team. You\’re generating hits for their sites, and you keep the spotlight on the videogame industry, ensuring its viability for years to come. Instead of enjoying your hobby and playing games, how often do you spend your time fighting an invisible \”console war\”?

And then we have Pachter, whose click-bait links make their way to forums all over the web, where he inevitably says something to get fans fighting. Meanwhile, he talks to White Rich America in a much much different way on TV. Us gamers? Hamstrung. We merely keep this billion-dollar plus industry rollin\’ (me included, being a forum dweller like you).

It all comes back to one thing: control. How do non-gamers exert control? Let’s take another walk down memory lane, to E3, about 8-10 years ago. What glorious times those were. Five FULL days of non-stop gaming. It was a cornucopia of wonder, third-party developers with scores of games in the pipeline, exciting consoles, and first-party developed wonders. It seemed like developers too numerous to list would storm E3, and we couldn\’t get enough. We were filled with questions: \”What is Free Radical’s new game?\” \”What is Amusment Vision gonna show?\” \”Wonder what Clover is showing?\” \”Will Silicon Knights show something new?\” \”I hope EA shows off a new SSX!\” \”Edios, Criterion, BioWare, Rare, Sega…OMG I CAN\’T WAIT!\” What happened? Where is the industry that had us waiting for so many games from so many talented developers? Control happened. Is it easier for business interests to control 100 devs (or to consolidate them into ever-larger corporate ownership), or to leave the status quo with its large and vibrant environment? I think you know the answer. Look around today. And did you notice and really look at E3 this year? It was full of me too’s. For me, it was the most boring E3 I can remember, chalk full of CGI trailers, fizzy hype, and war machines. There was little focus on, y\’know, GAMEplay. Also disturbing? The lack of a five-day E3. It barely made it to Wednesday. We had MS, Sony, Nintendo, Activision, EA, Ubi, and little else, outside of a few indies sprinkled into the mix. Dear God, we saw Plants vs. Zombies bastardized into a shooter by EA!

If you\’ve read this far, you may be thinking this makes for an entertaining conspiracy theory. \”So what are you going to say next, that Microsoft and Sony were MADE to feel like prohibitively-expensive HD was something that HAD to be done, that it wasn\’t merely an option?\” Well, now that you mention it…in the wake of so many third-party developers going belly up due to insane budgets, tell me such a theory doesn\’t fit. Tell me there hasn\’t been a top-heavy consolidation in the industry, where the Free Radicals of the world haven\’t been quashed (lest they cut into the sales of certain other games) and huge-budget blockbusters rule the balance sheets for stock investors.

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Now, what does this control mean for us gamers, and the devs who have been acquired? Well, some developers\’ projects have been acquired in kind, maybe never to be seen again. Take Timesplitters for example. In the age of the AAA blockbuster, good luck having it made (the marketing budget for games like COD or Battlefield sucks out funds that could go toward making it). Little by little, stock by stock, creativity and independence are a dying breed. I can only speak for myself, but I feel the majority of third-party games I\’ve seen revealed lately? Rehash and trash. There’s very little in the way of innovation from the big boys. But their stocks are in fairly rude health, because businesses interests make no distinction for quality when looking at the bottom line.

For the gamer, this means not having as much to choose from when you go to the store. If you\’re old enough, think of the slew of games (and developers) you had to choose from growing up in the NES/SNES-era. Now? It seems we are waiting for about 20 games year-round that we deem as worthy of our money. We are conditioned to fight now over very few games. Call of Duty vs. Battlefield. Grand Theft Auto vs. Watch_Dogs. Assassin’s Creed vs. Dishonored. Heck, even Mario vs. Sonic. Games built by large companies competing on a limited marketplace, which helps keep stock owners happy (it keeps up a steady stream of money that helps those large companies buy up their competition – smaller companies). Just a short while back we had 007 vs. Halo vs. CoD vs. Medal of Honor vs. Timesplitters vs. Perfect Dark, and more. We had Madden vs. GameDay vs. NFL2K (back when the NFL was a bit more liberal with its license). Maybe it was too much cannibalization (or too much competition) for the bigger companies to bear; there was too much unpredictability, which doesn\’t make for a safe stock.

Having most devs under fewer roofs helps to make sure they play by certain rules, too. Perhaps EA wants to really push DLC, but Free Radical would rather not dilute Timesplitters, and prefers to ship with all content on disc. Great for us gamers, but non-gamer interests can\’t have it like that. Everyone must play by the rules, which doesn\’t include giving gamers exactly what they want, not when publishers can have us pay extra for it. I call this the \”Westernization\” of all gaming products – DLC, micro-transactions, etc. Business interests have figured out how to wring out more than just the retail price of a game. Did this bleed into why I think MS and Sony felt the pressure they did? I think it goes hand-in-hand, and is why we are in the state of gaming we are today.

Being American, maybe I\’m jaded on the \”Westernization\” of gaming, but I don\’t think I\’m wrong to say that this culture is built on \”make money fast; do whatever you have to do to make said money.\” It’s a cultural problem, a \”pushy\” problem, if you will. It means a Business-A can lean on Business-B so much for so long that they (B) finally break the bank. Then the money Business-B would have been making flows into the coffers of A. This is the main problem Nintendo, and maybe the Japanese gaming industry at large, is faced with today. The Eastern market is the one thing that the stock market, business interests, the gaming press, and analysts for FIL have been unable to control. Nintendo has always pretty much mocked the rest of the industry with the huge profits they have been able to make, even when it seems like everyone has deemed certain products of theirs\’ a failure (e.g. GameCube).

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The American/Western market has grown so big and so pushy that everything either follows suit, or will be crushed. It gives me the feeling that all the woes at Nintendo right now are being caused at the hand of Western business interests. They own the media entertainment outlets, they make money off the fake \”console war\” through forums and social media, and they also own stock in all of the big-time publishers. So where does that leave Japan? Well Nintendo doesn\’t need them. We have watched the world economy struggle while Nintendo sits on a pile of profit, seemingly \”not willing\” to work with third parties. This makes no sense to me at all. You\’re telling me that a company who makes their own hardware, and makes a limited number of first-party games (some of the greatest in the industry, it must be said) doesn\’t want third-party games to fill in the gaping holes in their release schedule?

The \”fat cats\” want that Nintendo money. They are a powerhouse whose first-party offerings can\’t be controlled, and who has a dedicated fan base that shows up year after year, decade after decade. If you could buy a console with Nintendo’s own games, plus the inclusion of every major third-party game? They would have the best of everything at that point. The \”fat cats\” will not and cannot stand for that; it’s not in their business interests. Nintendo stands against nearly everything they\’re for – they rarely charge DLC, they don\’t charge for online, they don\’t take huge hardware losses, and they give gamers complete games. That’s where Nintendo’s money is made. So how do you spin what has proven to be a successful business model into a failure? The Western gaming media tells us \”Nintendo is still stuck in the dark ages, not getting on board for all these extra features you might never use, but we are going to charge you for, anyways.\”

You really think third parties don\’t want money? You think they cut Nintendo out because they don\’t offer one or two features? You think Nintendo doesn\’t like having great third-party games on their console, or that Kyoto is \”hard to work with\”? Please. I might have been born at night, but it sure as hell wasn\’t last night. You could only believe that by being blinded by the fake \”console war\” we\’ve all been a part of. It’s because the \”Westernization\” of the industry, and how it makes business sense to have a weak Nintendo – to expedite getting all of that money they sit on. Failing the dissolution of the company, weakening Nintendo far enough could make them spend that cash on Western exclusives. It worked like a charm on Microsoft, shelling out 50 million dollars for TitanFall. \”Well if we starve Nintendo enough of third party support for long enough, then make it look like it’s their fault for not playing by the rules…\”

If Japanese developers and Nintendo were smart, this is what they would do: band together and stand as one. The West is half-way there, with a few publishers controlling so much of the market. The East, on the other hand, has a very different mindset, and a very different way of conducting their business. You rarely see Nintendo of Japan coming back at the press (Capcom tends to keep quiet, too). They just let the West run its mouth, which creates the impression that the West is \”winning.\” But Japan is stronger than it appears (the \”death\” of Japanese gaming has been bandied about nearly as much as the \”death\” of Nintendo, or PC gaming). If Nintendo entered into some bigger partnerships with Capcom, Konami or Namco, and utilized the war chest that their profits have created? Yikes. There is strength in numbers, and imagine how difficult it would make the Western media’s job to slam those types of collaborations. It’s easy to pick on Nintendo alone, but quite a bit harder with that back-up.

To wrap this all up, I don\’t think we are living with the industry we think we have. These thoughts are not to start a flame war or belittle another’s console; it’s not about that. It’s about a bigger picture.

1. The stock market and \”fat cats\” pull the strings. It’s not individual companies, it’s the people who own them.
2. We are perpetually in a fake \”console war.\” There is a reason why forums are either not modded, or very sparingly modded, and have a tendency to follow the editorializing slant of that site’s front page.
3. We are being used to fuel the fight, whether we like it or not.
4. People like Pachter speak in very different ways to different audiences to fuel an agenda.
5. There is a very specific reason why such a schism seems to exist between Japan and the West, and it’s about some very different ideas on gaming. The Japanese gaming industry has reason to rethink their alliances (unless they\’d prefer Nintendo to be the last Eastern gaming company standing).

Thanks for reading. If you think I\’m crazy or went too deep down the rabbit hole, well…maybe I have. But you know what they say: it’s not really a conspiracy if everyone is out to get you.

mattavelle1