E Shop Concept

In recent weeks Satoru Iwata addressed shareholders in an Investor Briefing Q & A, tackling a range of issues around Nintendo's business. An issue that came up was the "digitalization" that we're seeing, with more and more gamers opting to download their games, and also seeking new ways to play for less money. Free-to-play and DLC are areas in which Nintendo's involved, while early access is still very much in the PC domain - there's also the question of iOS and Android, the games on those platforms driving prices down and, as a trickle-down effect, influencing how many of us perceive value. When a game is over $15 on the eShop, for example, we suspect an immediate reaction is to question whether it's offering enough for our money, rather than simply look at the kind of game it is.

In these areas, Satoru Iwata was arguably right when he highlighted the need for caution and a steady approach, stating that Nintendo's future in the industry will be reliant upon the right decisions, not the quickest.

The ways to have fun have expanded. At the same time, since distribution costs are becoming very close to zero due to digitalization, the number of consumers who do not focus on the value of the content is increasing, based on their idea that content can also be free. How we deal with this situation where there is the pressure to decrease the value of any digital content will be the key point for us. If we find the right answer, Nintendo will prosper as a company that creates content. If we make a big mistake, on the other hand, our business structure will collapse. We know there is criticism that our decision-making or transformation is slow in this field or our activities are not sophisticated, but we would like to take forward steps by considering everything thoroughly and with confidence that our future approach will work.

It's a fair riposte to critics stating that Nintendo's dragging its feet in the digital area of the industry, with the current eShop platforms showing forward-thinking in some ways - particularly in opening doors to smaller download developers - but being slow to react in other respects. Pricing remains a bugbear, of course, especially with Virtual Console games, and Nintendo is no doubt considering various approaches for the future; we hope that the customer loyalty program to replace Club Nintendo will be a part of that.

Nintendo's keen to highlight growing revenues from the eShop stores and cite progress, which is fair, but as we drift towards Q2 this year there are still aspects of its download gaming infrastructure that are moving forwards at a glacial pace. Let's put aside the issue of our Nintendo Network content being tied - at customer level - to hardware, too, and park that for another day. It's the eShop itself, and how we use it, that Nintendo should overhaul and improve in 2015. Doing so will not only help the 3DS, Wii U and developers committing to the systems, but help the company establish groundwork to truly take off on the download front in future hardware.

Steam is a go-to service for millions of PC gamers
Steam is a go-to service for millions of PC gamers

It was interesting, recently, to read the comments of Masahiro Sakurai praising the Steam platform - the PC storefront has a lot of features that its users take for granted - built-in achievements, community areas, both reactive and pro-active search options, wishlists, bundles, library sharing and more besides. Steam isn't perfect, of course, with Greenlight having problems and Early Access opening the doors to a worrying amount of absolute dross, but there are certainly areas where it's miles ahead of console stores. With its own app and online options, and fully integrated services, it's hard to disagree with Sakurai-san that it's the most feature-rich and comprehensive download store front in the industry.

Some of these features could certainly be welcome on the eShop, too, even if some are impractical or likely to collide with Nintendo's ethos. A slicker user interface and quicker loading could certainly be areas of continued improvement, even as we acknowledge that Nintendo has taken positive strides on both Wii U and 3DS. We've seen game bundles and promotions, in some forms, and we already have wishlists, but the way we rate games and engage with other users could be brought closer together. Miiverse can still be its own app, for instance, but it can also be integrated into the eShop, with immediate access to a game's communities to see popular posts, short written user reviews when looking at a product page. Bring gamers and the information we need closer together.

Another area that Nintendo should address this year is a full eShop that can be accessed online, both through the upcoming Mii-based smart device app and a separate dedicated browser website. Nintendo has the infrastructure in place, already utilising Nintendo Network logins to allow gamers in North America to buy games from the official website and have them automatically download to their Wii U or 3DS. In Japan, too, Nintendo's recently setup an eShop page that links from Mario Kart TV to allow gamers in the region to buy Mario Kart 8 DLC directly online.

Nintendo has made progress in selling eShop downloads online
Nintendo has made progress in selling eShop downloads online

These are all solid steps, and have allowed Nintendo to figure out the technicalities of these services - which now also includes pre-purchasing and pre-loading retail games. Yet it's also piecemeal, and rather erratically applied across websites and hubs. The ultimate step is a dedicated eShop website that effectively recreates the store in a browser, allowing you to browse and buy any game available in your region - this is already common with Steam, while Sony's offering is also very decent. To have the options of browsing games on the eShop, buying them online and then booting up the system to find them ready-to-play later in the day would be a real boon for Nintendo download fans.

None of this is revolutionary, these are established ideas. Nor are they a risk for Nintendo, as they can only bring positive results - if you give consumers greater convenience and access to content, there's a very good chance they'll buy more. Nintendo wins, and importantly third parties and Indies win, as more exposure for games helps generate sales and, in turn, attracts more developers to the store. Steam may have lost its way in some respects and is grappling with issues of quality control - as is Nintendo, on the latter point - but Steam's become a pre-eminent force in part because it has a fantastic system that works well for gamers; that's us, the customers.

Nintendo's right to tread carefully in areas of pricing and how it structures content, but it's still taking slow baby-steps in simple areas that can be hugely rewarding. The company's rightly proud of progress increasing download revenues, but it doesn't need careful thought to implement these ideas for improved eShop functionality. It should just get on with it, as they're win-win ideas.

Today we were reminded of just how exciting the eShop platforms can be; Nintendo has the opportunity, infrastructure and capabilities to make these stores modern, fully integrated and easy to use, in the process providing a worthy home for the games they host. This would help boost download sales on Wii U and 3DS, while also ensuring that Nintendo's next generation hardware comes right out of the gate with a digital platform to lead the industry.