Wii offers new challenge for third parties, says analyst

IDC analyst Billy Pidgeon has warned that while the success of the Wii and DS will have a positive effect on the games industry as a whole, publishers now face a new set of challenges with regard to producing games.

"Nintendo has always had top shelf first party software, and the Nintendo challenge for third party publishers is to produce titles that can compete with Nintendo's games," He told GamesIndustry.biz.

"The Wii and the DS raise the challenge with alternative interfaces, and publishers with titles that are optimised for those interfaces have the best opportunity to leverage the broader installed base for the DS and for the potentially broader base of the Wii."

Pidgeon's comments came in response to those made earlier this week by Todd Mitchell of Kaufman Bros. Equity Research. He said that the success of Nintendo's consoles "bodes poorly" for publishers, arguing that they now find themselves "in a permanent catch-up mode".

But according to Pidgeon, "Nintendo's success in bringing video games to a wider audience is a strong positive for the entire games industry. On a basic level, more gamers means more sales.

"The idea that Nintendo is bad for third-party publishers is a myth with roots in the 8bit -16bit days when Nintendo and Sega manufactured cartridges and the third party publishers felt they got short shrift in the production line," he continued.

"With N64 and GameCube, Nintendo suffered from a lack of third-party support and most of the third party titles that were published on Nintendo's platforms were slapped together ports of games for other systems."

Now, however, things have changed: "That publishers are eager to seize the opportunities is obvious from the strong third-party support and development investment in Nintendo's platform."

Pidgeon went on to observe that the unique features of the Wii and DS should encourage publishers to develop games specifically for the consoles - and put more pressure on them to ensure the titles are of a high quality.

"With mass market platforms also comes the challenge of more software competition. The publishers that are capable of producing competitive titles taking advantage of the Wii and DS interface will do very well," he stated.

"Publishers that provide quick and careless original and licensed titles or shoehorned ports of games designed for other platforms are going to suffer, as they should."