Recently, Nintendo announced that the JRPG "The Lost Dragon Covenant" co-developed with CyGames will be finally updated in July, and announced the closure plan, and this mobile game launched in 2018 has become another work that Nintendo has closed in the past two years. The analysis believes that the official uniform means that Nintendo will return to its main business - the host field.
Generally speaking, if the growth encounters a bottleneck, the mobile game customs service is a common thing, but the "Lost Dragon Covenant" customs service has attracted the attention of the industry, first of all, this is Nintendo's first and only original IP mobile game, and in the first year of listing, it received more than 100 million US dollars in revenue, which was the company's best mobile game at that time.
Secondly, after shutting down two mobile game servers in succession, (the first is the match-3 game "Mario Doctor World" developed in cooperation with Line, launched in July 2019 and closed in November 2021), Nintendo has no intention of launching a new mobile game, at least not mentioned in the financial report.
From these two points, it can be seen that Nintendo's mobile game strategy has not only not become a growing part of the company's business, but is still shrinking, and the latest Nintendo IP to land on the mobile terminal is "Piccine Bloom", or it is authorized and developed by Niantic, the founder of "Pokémon Go".
Now it seems that Nintendo's strategy to enter the mobile gaming market is more like a way to appease investors. In 2016, when WiiU failed in the market, the company lacked profit growth points, so it chose a profitable mobile game, and then "Pokémon Go" developed by Nitantic was a great success after its launch, which gave people hope.
Since then, Nintendo has begun to exert efforts in the field of mobile games, cooperating with professional mobile game companies such as DeNA to make its own first- and second-line successful IP Mario, Fire Emblem, Animal Friends association and other licensing into mobile games, but with the success of Switch and the lack of growth in the mobile game business, Nintendo began to reduce its investment in the latter, and eventually developed into what it is now.
Of course, this does not mean that Nintendo has completely lost interest in the mobile field, but the company has found that instead of cooperating with others to develop, it is better to directly authorize IP, such as licensing Piketmin IP to Nitantic and Pokémon IP to Tencent and NetEase. Judging from the slow frequency of Nintendo's licensing, they are still quite cautious in selecting partners.
Why is Nintendo experiencing a growth ceiling in the mobile gaming space? After analysis, it may be found that the mobile strategy will have a big conflict with the company's target users and main business, which is the main reason why Nintendo has reduced related investment.
The conflict is quite evident in The Lost Dragon Covenant: First, CyGames is a fairly successful Japanese mobile game company with similar titles like Blue Route, while JRPG is also a popular local genre, with success stories such as "Original God" and "White Cat Project".
As a JPRG built for mobile devices, the Lost Dragon Covenant is also operationally reprehensible, often with other works such as Fire Emblem: Heroes, and can also unlock new characters by drawing cards. However, the game was not launched in many countries around the world.
The reason is because of Nintendo's own reasons: as a "free" game, "The Lost Dragon Covenant" relies on "Krypton gold" to make money, but Nintendo has set a fairly low upper limit on krypton gold, that is, players can not charge as much as they want, and there is no kryptonite bigwig in the game.
For the player: it is a rather conscientious "krypton" game that unlocks almost all characters and items without spending money, and because of this, the game has been warmly welcomed by players. However, this also means that the game doesn't make much money.
Why limit kryptonite? Because for a long time, Nintendo's corporate image is "family-friendly", so it is very worried about the emergence of similar negative news similar to children stealing their parents' credit card kryptonite, or adults embezzling huge amounts of public funds to charge money, which have a great negative impact on the reputation of the company and the brand, so Nintendo has set a strict red line to avoid risks.
Therefore, we can conclude that the mobile game business is not Nintendo's main goal, but it is also indispensable: in the company's most difficult times, it needs to rely on him to get through the difficulties; but when Switch regains its industry leadership position, the natural profit model of mobile games is "incompatible" with the company culture.
Considering that the existing business model is already quite mature, it is unlikely that there will be any major innovations, and it is foreseeable that Nintendo will only drift away from the mobile game field after that.