Iwata: Lack of innovation to blame for slowing software sales

Speaking in an investor Q&A session last month, Nintendo president Satoru Iwata has said that low sales of DS software could not be blamed entirely on the problem of piracy, instead citing lack of innovation as a central cause.

Answering a question about the company's revised financial forecast, which featured a reduced sales projection for DS and Wii hardware, the president pointed out that games like Art Academy had bucked the trend of poor penetration in some of the markets hardest hit by piracy.

Iwata singled out Spain as a market where DS games had a particularly hard time penetrating the sales chart, partly because of the difficulty in applying rigorous anti-piracy laws. However, he also made clear that DS games had always struggled to make a retail impact in the territory, and that games which managed to break into the public awareness could succeed nonetheless.

"Nintendo DS software could not make it to the hit software sales chart in the country for sometime," Iwata told investors.

"However, when we launched the Nintendo DS software Art Academy in Europe this summer, which shows you how to draw pictures, it was ranked number one on the software sales chart covering all the videogame platforms in Spain. If one software can attract many people and can become a social topic, that software can sell regardless of piracy."

Whilst Nintendo are obviously keen to deal with the piracy issue on DS and Wii, Iwata sees a lack of innovation in the games available as a bigger problem.

"Of course, as a responsibility of the platform holder, we will tackle piracy. For example, when we launch new hardware, such as Nintendo 3DS, it is a good opportunity to beef up the countermeasures, and we are actually working on that now.

"On the other hand, I do not think we should attribute bad software sales solely to piracy. Even with piracy, as long as we can create products which can attract attention from many consumers and which can greatly entertain them, that software can make it to the number one position of the hit software sales chart. "

Iwata also claimed that it is this lack of variety which is causing a downturn in software sales across the industry.

"For your information, the slower sales pace of games is not confined to Nintendo, but is now an issue the whole videogame market is facing. I understand that it is because consumers are having a hard time finding something new among the proposals videogame producers are making today. "

Nintendo has targeted the sale of four million 3DS units by the end of the fiscal year in March, 2011.