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Nintendo (NASDAQOTH: NTDOY) has shared very little information about how his characters will be integrated into ComcastUniversal Studios theme parks in Tokyo, Hollywood and Orlando. Some driving ideas have been teased – get ready to ride a Mario Kart race – but the plans are vague. Universal Studios recently announced plans to launch a fourth theme park in Florida. Could Nintendo's characters become a major part of this attraction?
And as the popularity of esports increases, Nintendo is late. Competitive game publishers are already organizing massive tournaments for millions of viewers, but the manufacturer of Super Smash Bros. finally plunges into this part of strong growth sector.
A full transcript follows the video.
This video was recorded on October 16, 2018.
Vincent Shen: I've heard about a new potential Super Mario film in the works.
Dan Kline: I do not think it can go beyond the old. [laughs]
Shen: It is potentially going through the production phase. But they also looked at more licenses for theme parks, which you pointed out to me. Can you talk a bit about it?
Kline: At present, on the site of Universal Studios in Japan, they are already under construction on what is called Nintendo Land. This is a handful of rides. They were very secretive. We know that there will be a Mario Kart ride. Think of it as Star wars expansion to Disney, a very immersive country, a big problem. In Orlando, they said, "We will build Nintendo properties." But they were very suspicious about the place. The rumors had always been at the origin of Universal Studios. There is an area for children that is a bit lifeless, that would make sense. However, about a month ago, it became public that Universal Studios is building a fourth gate, another theme park, and they have amassed much of the ground to do it. So, it makes great sense to think that Nintendo is going to be the cornerstone, the Harry Potter, from this new amusement park. And maybe there will be a link with one of the other theme parks, as the train connects the two Harry Potter Worlds together to help sell multi-day tickets. This is a risk for Universal and a huge win for Nintendo, as they collect license fees, whether it's an instant hit or not.
Shen: All new people who go to this park and enjoy these rides, potentially bringing them into this world for Nintendo.
Kline: In theory, you will bring people who do not know what to do Mario Kart is or has never played Pokémon, and they will enjoy the driving experience and then go out and experiment with video games.
Shen: Yeah. The last topic, we only have a few more minutes, I want to talk about e-sport, because it's one of the most popular trends in the entire video game industry right now. and where Nintendo is following this trend. If you are an auditor and you have guessed that Nintendo is still a little late, you would be right. In the field of electronic sports, Nintendo has generally adopted a more moderate approach, allowing organizers of independent tournaments to organize their own events and prizes with very limited participation of the company. Maybe Nintendo will offer marketing support, hardware, consoles, for example, at the tournament or at the event. But their efforts have nothing to envy to what Activision and EA have planned, in terms of multi-million dollar franchises, major tournaments, thousands of spectators and these very big prizes.
But Nintendo is experimenting more with e-sports formally this summer. They had the Splatoon 2 world championship and also the Super Smash Brothers by invitation tournament to present these titles, especially the next Super Smash Bros Ultimatewho arrives in December for the Switch. Title very much expected for this console. This should be a big seller during the holiday season. I think Super Smash Bros alone, sales of software or video games could increase, as well as console sales for all those expecting this title, one of the most popular multiplayer titles of all time.
Kline: They really built the case to buy the switch by – in the beginning, it's like, "Well, OK, Mario KartI want somehow that. "Then they add one title per quarter, and then you end up saying," God, I must have this. There are like 10 things. "
But when it comes to e-sports, they have to design some of their games a little differently. If you look at older versions of Super Smash Brothersthey are not purely competitive games. There is a level of awkwardness to that which removes e-sports. I have not played the new title, but I guess we will have at least the option of a purer competition that is-better, as opposed to what we play, then I'll I walked on something that made me super powerful and I kill you and it has nothing to do with who is better. I imagine that they will have to organize looser and more fun tournaments that are not as competitive; or, they will have to set up games that work for this world.
Shen: Yeah. We are run out of time. My last thoughts, Matt, is definitely a case where I can see where you're coming from, as Nintendo is not getting enough love compared to some other US-based video game companies. But I think that the recovery, thanks to the success of the Switch, is undeniable. And I really like some of the other investments and priorities of management, in terms of what they can do with all their valuable IP property. One last thought from you, Dan?
Kline: If you look at the life cycle of the consoles, the success of the Switch gives them 10 years to plan what will happen next. I think what happened is that they had always had a powerful console. That made them a little complacent. They did not need a license, they did not need a partnership, they did not need to do business in the theme parks. Now, if the switch is the latest Nintendo console successful, I think that they will be ready for the world that could represent that, where they are licensed, they have partnerships, they have worked with Applethey worked with other people. It resets the company and gives it time to become a growth story, when it was a shrinking story that had very good IP addresses. This makes me very excited for the future of Nintendo.
Shen: And it is certainly worthwhile to be able to make some of these investments, to do some of those experiments when you're on a roll and to double your revenue in the last fiscal year.
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