James Moore: This time around, Nintendo’s ability to innovate may not be enough

Outlook:

Is it game over for Nintendo? Not yet, but the kart driven by the company that brought Mario into the world has certainly got a puncture.

The question is, can its directing brains see through the thick layers of corporate bureaucracy that surround them to find a solution? You’d think that three years of operating losses and a 20 per cent tumble in the share price would do the trick.

But so far Nintendo’s top brass seem content to drool over the latest cutesy creation of Shigeru Miyamoto while thinking “wait until they see this – they’ll be fighting for our console when they do”.

In fact “they” are more likely to be moaning about the ruinous cost of the app purchases the makers of Angry Birds Go! are trying to get them to shell out for on their Tesco Hudls. Or their iPads. Or their PCs.

Today’s budget-constrained families are increasingly asking why they need to bother with a Wii U or even a 3DS for their little darlings when tablets or even smartphones offer a wider variety of games and much more besides at a very competitive price.

That’s why Angry Birds developer Rovio and its ilk are cleaning up. And it’s not just games. You won’t see a lot of Mario hoodies in today’s schoolyards.

The sort of people who will buy the games that modern consoles offer – huge, expensively produced immersive experiences – find Nintendo déclassé while its traditional supporters are deserting it.

It’s true that the company has endured lows before, only to revive itself. It wasn’t exactly setting the world alight when the Wii made its debut and pushed the shares to an all-time high in short order.

Its longevity in a famously tough industry that has spat out so many rivals is remarkable. The ability to innovate and the quality of the games it offers are telling.

But that may not be enough this time around. Nintendo says it is studying smartphones. It needs to be a quick learner. There is a market for its product, a huge and potentially enormously profitable one, but that market is playing in a different ballpark and even the magic of Miyamoto may not draw them back.

Nintendo, so long a leader, has to learn to follow its customers this time, and break out of the closed world of consoles by opening its eyes to the open architecture its former fans have embraced.