Rod Cousen of Codemasters on Wii and Third Parties

Jan. 13 5:53 PM by Lynxara

This interview is very far-ranging and may be of more general interest if you follow the industry as opposed to just Nintendo, but there are two sections that talk about Nintendo and its approach to third-parties extensively. These should be required reading, since this kind of analysis from the viewpoint of Codemasters is valuable. Not only are they a legitimately global company, but...

... well, the two Codemasters Wii games I can think of off the top of my head are Heatseekers and the upcoming Emergency Mayhem. The former is solidly mediocre and the latter might hopefully be better than mediocre. I doubt either title goes significantly over 50,000 copies (if that far). So, to an extent, bear in mind that Cousen's company is publishing material very similar to what he sits down to criticize in parts of this interview, and that many Wii gamers would consider lame-to-crappy.

Anyway, the relevant bits of the interview are behind the cut.

BIZ: Speaking of the cycles, how has the makeup of the current console war had an impact on Codemasters? What's your take on how this is evolving? Certainly a year ago nobody would have expected the Wii to have dominated the way it has and for the PS3 to struggle initially.

RC: The global event that's been marked as a surprise for most people is the huge success that Nintendo's achieved in every territory... The challenge that third-party software publishers face in supporting that market is that it's clearly a market dominated by the first party and always has been. If you look back at the Nintendo track record over the last 20-25 years, it's a typical situation where Nintendo will take 60-70 percent of the market and third parties will compete for the remaining 40 percent. One of the challenges is: will that result in a sudden flood of software by third parties onto a platform that's currently seen as the Holy Grail, and as a consequence there's a lot of wastage? So I think you have to have a pretty defined product strategy, which is platform specific... but certainly on a global basis Nintendo is the only platform in each of the markets to take up a position of leadership.

BIZ: You touched on this a bit already, but in terms of the Nintendo phenomenon of first-party titles dominating, it seems third-party publishers are trying but not making much headway. Do you think over the long-term that the smaller revenues for third parties will actually hurt the Wii as more and more publishers possibly change their approach and pull back from what they're willing to put on the Wii?

RC: That's my view, because if you look at the harsh realities of the return on investment model and when you've got a high failure rate amongst a significant uplift in the output, then clearly you start to back off. If you look at the DS in Europe, there's 240 DS titles launched in October, November and December, and maybe 30 will sell. When you're building that wastage or obsolescence into your equation it's a difficult thing. I think the short-term answer is you have to be quite clear that it's not a simple exercise that "I own this IP so I'm rolling it out across three or four platforms." You have to ask "Will it work on that particular platform, or do I get creative?" Cooking Mamas and stuff like this. What staggers all and I would have argued against this years ago is how many pony games or horse games have sold on Wii and DS; certainly in Europe it's been a significant volume I think. SCi/Eidos did 700,000 Pony Friends over here. None of us probably would have put that in development.

I think you have to go and take a long, hard look at it and figure out the content that works and recognize that the business model operated by the first party, which hasn't changed in all that time... If you go back to the Nintendo model when it first started you had a five-product license and so one of the ways in which software publishers dealt with that was to go and buy a competitor so you could increase your output to 10. It was a way of managing product outflow both from a first- and third-party perspective, but it was always done on the basis that even if you bought up another five-product license you still knew the available share to you was something on the order of 40 percent and that the product flow, which was cartridge-based at the time, seemed to be managed in a way so that's how it folded out. Well, I'm not so sure that the current wave is any different, because I hear there's manufacturing shortages, and too much software... and these are all consistent characteristics. Software publishers have to look at that very carefully and determine their strategy, and I do agree with what you just said. That's what I suspect will happen.

Maybe I'm just a grumpy old man [chuckles], but I think this cycle has got a long way to go and it's certainly not over. Anyone writing off Sony and Microsoft do so at their peril. I could give you an argument that says there's going to be a Wii 2 pretty quickly because [Nintendo would need one] in order to sustain momentum over a 10-year period. And what type of software would it have then? Because right now it isn't driven by technological supremacy or power. I wonder if the idea of opening up a whole new audience to 60-year-olds looking to make sure their brain cells don't die off is a sustainable form of entertainment. Maybe they got it right because we are all an aging population in Western markets, but I somehow think as a form of entertainment that won't be the case.

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