Nintendo to put Mario and Zelda on the big screen as it eyes the film business

Can Mario save the day?

Much-loved characters such as Mario and Luigi have forged the Nintendo brand

Nintendo is planning to make movies, using cash from the sale of its stake in the Mariners baseball team.

The game maker’s push into the film business shouldn’t be a surprise; character-driven movies such as the Avengers franchise are money makers and Nintendo is struggling to keep up with changes in the gaming industry.

The company has yet to formulate a convincing strategy for mobile gaming and its next-generation gaming device, called NX, isn’t going to debut until next March.

Any movies that might feature Nintendo’s popular characters from its Super Mario and Zelda franchises are probably two to three years from hitting big screens.

The Japanese game maker said it’s in talks with multiple partners and plans to take the lead on production, rather than licensing out content. The effort will be funded from Nintendo’s sale of the bulk of its majority stake in the Seattle Mariners, which valued the team at $1.4 billion.

Tatsumi Kimishima, Nintendo’s president, detailed the company’s plans in an interview with the Asahi newspaper published on Monday. While Nintendo would work with partners, he emphasized that the Kyoto, Japan-based company would produce its own films instead of licensing characters. A spokesman for the game maker confirmed his comments.

“The desire to develop new sources of income from globally-recognized characters, not just from games but from multiple areas, is understandable,” said Tomoaki Kawasaki, an analyst at Iwai Cosmo Securities.

All of this is part of a bigger push by Nintendo to generate more money from its trove of popular characters. The movie announcement comes less than a month after the company issued forecasts for net income and revenue short of analysts’ estimates on plunging sales of the Wii U console and 3DS handhelds.

Nintendo’s revenue has declined for seven straight fiscal years, including an 8 percent drop in the latest period to 504.5 billion yen ($4.6 billion).

Last year, before he died in July, Nintendo’s late President Satoru Iwata laid out plans to bring in new sources of income.

Those include a toy platform for the console called Amiibo, similar to Activision Blizzard’s Skylanders, and an alliance with Comcast Corp.’s Universal Studio theme parks to create attractions based on its characters. The film business is a logical fit within this broader strategy.

“The kids of today are playing Minecraft and other stuff, and know less about Mario than the adults who grew up with them,” said David Gibson, an analyst at Macquarie Securities.

Known for popularizing video game consoles more than three decades ago, Nintendo is hedging against a future when it may no longer be able to rely on console sales. Young gamers are now putting aside their Wii controls and spending more time playing games on smartphones. While Miitomo, Nintendo’s new free-to-play messaging app, has attracted more than 10 million users since its debut in March, the company hasn’t committed the most popular characters to the smartphone effort.

This won’t be the first time Nintendo is putting Super Mario on the big screen. In 1993, Bob Hoskins and John Leguizamo starred in a live-action flick called “Super Mario Bros.,” which flopped (it boasts a 15 percent rating on Rotten Tomatoes).

Microsoft spent years trying to turn its Halo first-person shooter franchise into an blockbuster hit, with little to show for it.

Still, there are some signs of modest success in bringing the world of video games to movies.

A 2001 science fiction film based on Square Enix Holdings Final Fantasy role-playing games attracted nerdy audiences (Rotten Tomatoes rating: 44 percent). “The Angry Birds Movie,” based on Rovio Entertainment Oy’s hugely popular smartphone game, debuted last week and was a hit among international audiences.

The trick for Nintendo will be to make sure that its movie, gaming console and smartphone efforts work together to build audiences and bring more people into the worlds of Mario and Zelda, according to Iwai Cosmo’s Kawasaki.

“Their main business is gaming,” Kawasaki said. “If the push into movie production can be synergistic with the NX console and smartphone-games initiatives, this could be a worthwhile strategy.”

© 2016 Bloomberg L.P