Nintendo's Surface

So, Nintendo had a good quarter. They've sold 2.74 million units of the Switch in the month since lau
M.G. Siegler
Nintendo's Surface
By M.G. Siegler • Issue #66
So, Nintendo had a good quarter. They’ve sold 2.74 million units of the Switch in the month since launch – more than the Wii U did in its entire first year. Humorously, they actually sold even more copies of Zelda: Breath of the Wild – 2.76 million – which should tell you all you need to know about inventory issues for the console itself that remain. Profit was $1.6 billion for the quarter, which finally pushed them back into the black for the year ($584M). 
So, Nintendo is saved, right? Hardly.
Launch quarters of new consoles are always great. But it takes a while to see the actual lasting power of the device. The Switch is good, but not great. Zelda is great. People seem to like the just-released Mario Kart 8, but that’s also just a port of the version made for the Wii U, which never sold well because that console was a disaster. Every other game so far (and there aren’t many) is entirely lacking.
The good news for Nintendo is that because they didn’t release the Switch in the holiday quarter, they can look forward to a bump at the end of the year (undoubtedly aided by the new actual Mario game as well). That’s assuming they can figure out production issues by then, of course. 
But I’m most curious about a year from now. Once the Switch has been out on the market for a while and the main key titles are all post their blockbuster launches. Will it continue to sell well? That’s the only test that matters. Because if it doesn’t, Nintendo is not only right back in trouble, they’re in more trouble than ever.
I just look at the company and see pure incompetence. It’s being masked by their fantastic IP. But they’re continually doing the wrong strategic things with said IP. A mobile game that could make a ton of money, but instead makes almost none. An insanely popular retro console that sells out immediately and the company refuses to make more (more on that in a link below). Etc. 
These are things that on the surface look like good problems to have, but I believe that just below that surface are bad problems to have. The company doesn’t seem to know what it’s actually doing, and worse, can’t execute when it becomes obvious. 
So yeah, let’s talk in a year. 

5ish Links
Joe Drape and Brooks Barnes on the big layoffs at ESPN – including many on-screen folks and reporters we all know:
“ESPN was wrapped in Teflon for many years, but big payouts for rights fees plus significant losses in their subscriber base were like punches to the gut and head, and now the company is trying to make sure they are strong enough to fight in the future,” said James Andrew Miller, who wrote a book on ESPN and has contributed to The New York Times. “They’ve decided one way to do this is to change their approach to content and rely more heavily on digital; this has enabled them to let go of a big chunk of their talent base.”
Sad, but hardly surprising – this particular writing has been on the wall for at least a couple years now. And it seems like things could get worse yet
Just a great post about the Mac Pro situation by Sebastiaan de With that I’ve been meaning to link to for a while. As he rightfully notes, it’s easy to cast aside Apple’s professional products – and the Mac Pro, in particular – as being too small of a business to matter to Apple anymore. But this would be folly. This top-of-the-line market is what has led to all of Apple’s mainstream success – because the creators (of both apps and content) all use these tools. 
Apple not only shouldn’t abandon these folks, they should go above and beyond to embrace them. Even if it doesn’t seem to make pure balance sheet sense…
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Devin Leonard and Christopher Palmeri:
In the mid-aughts, Disney and Universal competed for the theme park rights to Harry Potter, which Warner Bros. Entertainment Inc. controlled. However, the studio and J.K. Rowling insisted on the right to approve much of the final product, and Disney decided not to bid. In a 2012 interview with Bloomberg Businessweek, Iger said the company’s parks division “didn’t like the terms.” So Universal got Potter and ended up, as some in the park business have observed, out Disney-ing Disney.
Interesting that Disney walked away because they didn’t like the terms – which doesn’t seem to be money, but rather WB/Rowling’s desire for full creative control. Much like why Disney isn’t bidding for the rights to the James Bond films, they don’t like this lack of total control
So instead, we have Pandora: The World of Avatar about to open next month in Florida. I don’t know. Count me as very skeptical about this partnership. Yes, Avatar is still the biggest film of all time, but it must be the smallest biggest film of all time. It’s only eight years old, but those have been a long eight years. It just doesn’t seem to be a part of the zeitgeist at all anymore – and really, it was only for a brief moment of time.
The forthcoming sequels will undoubtedly help. But those are now pushed until 2020. I’m sure Disney would have liked them a lot sooner, as originally planned. So yeah, this seems awfully risky for such an expensive excursion for Disney. 
Of course, they’ll always have Star Wars to fall back on now. Those parts of the park will make an absolute killing, no doubt. 
Tom Phillips:
Last week, Nintendo explained that it never intended NES mini to be a permanent product. From the company’s perspective, the microconsole was planned as a cool novelty item perfect for Christmas 2016, and the numbers in which it was manufactured and shipped were expected to be enough to suit this goal.
But NES mini ended up breaking out to become more popular than anticipated and quickly sold out, leading to a bustling resale market on eBay. NES mini shipments continued into the early part of this year, but its production run could not be extended further - as SNES mini was slated for production instead.
Hopefully, more stock of the SNES mini will be made available to avoid a repeat of the same shortages.
Yeah, okay. If Nintendo really didn’t know how popular the NES Mini was going to be, they’re fools. This. Was. Obvious. So obvious, that I laid out the plan for what Nintendo should do to create a new hit over three years ago.
Worse, when they stumble into a hit, they freak out and do the exact wrong thing. I’m still in the camp that thinks products like the NES Mini should be Nintendo’s core product. So is there any question they’re going to fuck up the SNES Mini as well? 
This leak was to try to dampen the outrage about the killing off of the NES Mini. But how stupid does Nintendo think we are? More importantly, how stupid do we think they are?
Jennifer Schuessler looks into the morphing of “Six Degrees of Separation” from a play into a meme. On interesting tech-related tidbit:
The degree of separation, it turns out, is less than six. Last year, researchers at Facebook reported that the 1.59 billion people on its network were separated from one another by only about 3.5 people. And that number had been shrinking: Five years earlier, when there were fewer than half as many people on the site, the figure was 3.74.
Also, the center of the Hollywood universe is not, in fact, Kevin Bacon, but rather, Eric Roberts.
Quickish Hits
Great, concise post by Phin Barnes. If you’re not actually going to do something, for whatever reason, just say so. I suck at this too.
Huge kudos to Chris Sacca for one hell of a run with Lowercase. Bigger kudos for being able to walk away amid such success.  
I predict such posts are only going to get more prevalent with time. Because the simulation demands it. 
500ish Words
Tesla can power ahead, growing into the realm of myth…
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M.G. Siegler
Links to stories around the internet that I have thoughts on. Thoughts longer than 140 characters, otherwise I'll tweet them. Thoughts less than 500ish words, otherwise I'll write them.
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