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October 23, 2012

Slate: How Nintendo saved itself from irrelevance

Imagine that Apple released a new iPhone not once a year but once every six years. Apple's press conference would get higher ratings than the Oscars. Users wouldn't just complain about the terrible new map app. They would riot about it. It would be, in short, unbelievably exciting.

That's kind of what it's like to be a gamer.

Gamers wait six years between new consoles, and they're going to get another one, finally, on Nov. 18, when Nintendo will release the Wii U. What's different this time is that the hungry masses of the Nintendo tribe include the old as well as the young, girls as well as boys, and extroverts as well as recluses. Gaming has not only grown larger, it has grown diverse in its players and its forms and its functions. And that's thanks, in large part, to a phenomenal turnaround by Nintendo.

The Nintendo brand name evokes a cast of gaming characters widely known and widely loved: Mario, Princess Peach, Donkey Kong. It conjures up for men of a certain age fond memories of collecting coins and shooting fireballs and breaking barrels. But by 2006, the company virtually synonymous with gaming found its relevance fading.

After introducing the Nintendo Entertainment System to the United States in 1985, Nintendo spent the next 10 years virtually dominating the video-game console market. Other consoles came and went, but few approached Nintendo's popularity. Nintendo met its match when Japanese entertainment giant Sony entered the field in 1994 with the PlayStation. The Nintendo 64, released two years later, would never outsell the PlayStation. Still, Nintendo's popular games bolstered the console's success, and it sold well in the United States. Despite the new competition, Nintendo held strong.

But Sony and American tech behemoth Microsoft, which eyed the market, belonged to a different weight class. They had more resources than little Nintendo could ever dream of. They could draw knowledge and resources from their other lines of business to produce technologically advanced devices. Sony's PlayStation 2, released in 2000, and Microsoft's Xbox, released in 2001, had great processing power, spiffy graphics, sleek design and inbuilt memory. Although more expensive, they doubled as DVD players. They included online play. Microsoft spent a billion dollars on Xbox Live, an online service for multiplayer gaming and digital content delivery.

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