New Nintendo 3DS Faceplates

In mid-January Nintendo hosted its first 'Direct' broadcasts of the year, and what seemed like improbable retailer leaks turned out to be true. North America was confirmed to be receiving a unique red New Nintendo 3DS XL - which looks rather nice - along with the black equivalent, but would not receive the smaller models as per Japan and PAL regions.

It was a busy period in which we typed until our keyboards begged for mercy, and in general our reaction to that one particular announcement was similar to that of a vocal group of others - in summary, we were confused by the decision. This writer characterised the Nintendo Directs as both "brilliant and baffling" at once - with the baffling part being the XL-only NA announcement - and the topic came up again in a broader editorial looking at the route to release of the New 3DS as a whole, in which we shared a view that it could be a huge success but had tread a rocky path to the West.

In that same article, our long-term US writer and portable enthusiast Ron DelVillano shared his personal perspective on the shenanigans with the XL, in summary expressing disappointment at the decision, but also railing against some of the reactions it had garnered online.

I'm not generally one to complain too publicly or too loudly, but Nintendo – a company that I have supported for as long as I can remember – really let me down. I couldn't imagine why the company would decide to release a console worldwide, then block North Americans access from enjoying the entire lineup. There was something that I wanted, but instead I was offered something else entirely. I spent a good amount of time on Wednesday stewing in frustration until it occurred to me: Nintendo doesn't owe me anything and I don't deserve anything from the company just for being a customer.

...Don't get me wrong; I think it's fair to be frustrated and bothered by corporate decisions that ultimately affect what you can and cannot purchase, but don't think it's fair to act belittled or betrayed. This was obviously a strategic decision that Nintendo had to come to and I'm sure it wasn't an easy one to make. That being said, if you are living in North America and you do not want the New 3DS XL, then I encourage you not to purchase one. Show the company what you do and do not want through your support of their products, not by lashing out with petty attacks on social media.

So, those are some perspectives, but the whole issue has somewhat blown up again following comments made by Damon Baker - Senior Manager in Marketing and Licensing for Nintendo of America - to us in an interview at Indiecade, when we asked whether the company expected the blowback that occurred in mid-January.

Yeah (laughs). Look, the face plates are super cool, but we're a different market. And now we have clear differentiation between those three systems. Before, there was a very limited difference between the 3DS and 3DS XL: other than size. It was the same resolution, same functionality... now, there's the 2DS, 3DS, and New 3DS XL, all of which have their own functionality and features. The different price points give it a clear message for consumers. The core audience... we weren't going to win with them on that decision. But we had to think about expanding the user base, we had to be able to market it and make it easy to pick up for consumers.

It's this writer's opinion that negative interpretations of the 'laugh' are unfair - this was a conversation at an Indie event and more relaxed than an email interview filtered through PR. Whenever we've been caught up in controversies in the past - obviously on a far smaller scale - this writer's had conversations with others that would have had an equivalent 'laugh'; it's a mechanism for dealing with what can be a difficult scenario - namely, thousands of fans complaining about a decision. Beyond that, it was a variation and subtle expansion on the exact same policy and decision outlined before - below is an old PR statement on the topic.

Different territories make their own business decisions regarding individual products and timing. We think New Nintendo 3DS XL makes the most sense for our market. Nintendo makes different systems at different price points for a whole range of consumers, and New Nintendo 3DS XL simply expands those choices even further.

All Baker did, ultimately, was acknowledge the core group of fans most aggrieved, with the general line matching what was said before - there was some additional nuance without rocking the boat.

So there's an element of deja-vu here, and while acknowledging the valid complaints, let's also accept that claims this was a rapid departure from the party line are inaccurate - it was simply a more human variation that hadn't been through layers of public relations.

With that out of the way we're going to play devil's advocate, in the interest of giving some balance to both sides of the argument.

New Nintendo 3DS Faceplates 2

Disgruntled Fans

This past week has brought a return of the #OperationFaceplateNA campaign, a continuation of previous fan complaints about the XL-only policy currently in North America. This section will be short, as the grievance is an obvious and honest one - some fans in the region want the choice of the smaller model, end of story. Its design, the fact the screens are 20% bigger than the original, and those cover plates, make it the desirable choice for some. It's simply a demand to have the choice.

That's all reasonable, and a few of the Nintendo Life team here in Europe certainly opted for the smaller model. Not all, naturally, but the choice is welcome. It's not often that North America - as a region - is left out with hardware iterations, not unless it's also missing out with PAL territories, so the decision has stung many. The hashtag is relatively active on Twitter, there are petitions with over 4000 names on them, and there are plenty of forum threads all with the same goal - getting the New Nintendo 3DS released in North America.

Part of the irritation comes from disagreeing with the actual logic of Nintendo's official reasoning, quoted twice above. We ourselves have questioned this logic in editorials, but it seems likely it is - like poor communications around amiibo stock in recent months - an example of a large company struggling to get a satisfying message out; with this situation, little it can say will appease fans, in any case.

It's a simple cause, and one that can be justified.

New 3DS

Nintendo's Potential Reasoning, and Market Realities

Not long ago we rummaged around in Nintendo's financial results which, though not the most thrilling activity, helped us figure out some of the ways the company is making profits while reporting decreasing sales. Namely, it's spending less on marketing and inventory than in previous years. The latter may be dull business jargon, but it's relevant - Nintendo is managing its manufacturing and distribution so that it has less stock sitting around unsold, and seems to be more efficient at only making what it can sell. The early days of the Wii U were a disaster, financially, as money was paid to make systems that wouldn't sell or, even worse, were sometimes returned by dissatisfied retailers. The scenario's better now, but Nintendo is trimming back its inventory, which also means not making too many products.

Moving on from that, there are practical issues, too. We already suggested that the pre-Holiday release of the New 3DS in Japan and Australia / New Zealand, but not elsewhere, was surely down to managing stock and potentially struggling to manufacture enough systems for demand. Even with the delay into 2015 for the West, supplies of the New systems - particularly popular models - have been tight, with the XL models being quite hard to get in multiple territories, including the US.

Another issue with the US in particular (with some potential impact on Canada too) could be unrelated to any of this, with some linking port strikes in the country with affecting imports. We're still waiting for the official translations, but our own efforts at translating the recent investor Q & A in Japan suggest that while software shipping into the US can go ahead as normal through air freight, chunkier goods - such as hardware and amiibo - have been affected by delays dealing with imports at US ports. This has been speculated upon elsewhere, too, and may be a partial explanation for the problem.

Now to the crux of the matter. The XL models seem to comfortably out-sell the smaller models, even with the New hardware. The New XL comfortably out-performs the smaller model in Japan every week, while Nintendo UK's James Honeywell told us that "the majority of sales are going to be XL initially", admitting it may be skewed by the popularity of the two launch limited editions - which were also released in NA. It's suggested the smaller models may catch up, but we certainly saw circumstantial evidence in the UK that the XLs were getting mopped up (including standard Blue and Black models) in pre-orders and in day one sales, with the smaller models coming off second best. Statistically, flawed or not due to the problems the original 3DS had, the XL leads the way; it does seem that many consumers simply prefer the larger screens, regardless of how cute cover plates are.

New 3 DS Sales

One instinct we have, if stock and distribution is an issue and consideration, is that Nintendo of America - being the biggest player for Nintendo outside of management in Japan - decided it wanted lots of a good thing with the XL, rather than split stock. That's a guess, but the system clearly started well in its launch weekend, as you can see from Nintendo's own chart above.

We're not sure we buy the logic being fed by Nintendo about clarifying brands and options, but that's the only explanation we've been given. There are various factors that will have dictated the decision, some of which we've touched upon, and it's not unfair or apologist to suggest it was likely a difficult decision. There are enough circumstances and examples to suggest that Nintendo's not exactly doing a great job at producing and selling to meet demand, and we find it hard to think that's not a factor behind the PR line.

New3 DSplushies

And in the end...

Of course, reasons and practicalities won't be enough to satisfy all in North America that are frustrated, but context should matter a little nevertheless. We're not of the opinion that Nintendo's deliberately shunning or trying to infuriate some - though it's definitely had that effect - but rather is dealing with business realities and the bottom line. With various factors to be taken into account, this screams of a scenario where the best is trying to be made of less-than-ideal circumstances, even if that best simply isn't good enough for a sizeable contingent of gamers. If the challenge really is stock allocations, ultimately, it wouldn't surprise us if the smaller models do head to North America later in the year once demand for the XL systems is well under control.

We'll see how it evolves, but the purpose here was to try and introduce a bit of context to this whole situation. Nintendo of America's stance, officially, is the same as it was in mid-January, and it's made a call that's annoying and baffling on many levels, but has grounds in business logic and circumstances. It's far from being black and white, and sales realities - flawed or not - no doubt make the XL a 'safe bet' in the region. You don't have to agree or totally accept these reasons, and we've certainly been right there in saying Nintendo of America hasn't made the smartest call in alienating a group of core fans, but it's also a reasonable thing to do to move beyond outrage and look at cold, hard realities.

Unfortunately, when campaigns are run online they portray situations in often polarising terms. Hopefully those that want a smaller New 3DS model in North America will get their chance sooner rather than later, but we also hope the bigger picture is also taken into account by all concerned - both Nintendo and disappointed fans.