Nintendo Co., Ltd. 7974.T
Nintendo should port Mario, Zelda and Donkey Kong to iOS/Android and buy a free-to-play studio — the casual gamer has moved to mobile, where $100bn of attention value awaits.
Thesis
Oasis Management, a Nintendo shareholder, follows up on its June 2013 letter to CEO Satoru Iwata urging him to release Nintendo's library on iOS and Android and embrace free-to-play economics. The argument leans on three analogues: Facebook's $19bn WhatsApp purchase and the $100bn+ aggregate value of mobile 'attention share'; Netflix's 21% revenue growth and 296% 2013 stock return on a platform-neutral distribution model; and King Digital's leap from $8m to $568m in net income on just $15m of capex — a profit level Nintendo has not reached since 2011. Meanwhile WiiU unit sales keep disappointing despite a $50 price cut. Fischer proposes Nintendo partner with or acquire a proven free-to-play studio, citing Zynga's $527m purchase of Natural Motion as template, to preserve IP relevance and unlock huge upside for all stakeholders.
SCQA
Nintendo, holder of arguably the largest library of casual games — Mario, Donkey Kong, Zelda — has tied its future to proprietary console hardware like the WiiU while its casual-gamer audience has migrated to smartphones.
WiiU units keep disappointing even after a $50 price cut, while Facebook paid $19bn for WhatsApp and King Digital leapt from $8m to $568m net income on only $15m of capex — a profit level Nintendo has not reached since 2011.
Release the Nintendo library on iOS and Android via the App Store and Google Play, and partner with or acquire a proven Top-10-grossing free-to-play studio to de-risk the shift into in-game revenue economics.
Capture a meaningful share of the $100bn+ mobile attention economy, extend the life of Nintendo IP through free-to-play in-game revenue, and deliver 'huge' upside for shareholders when the pivot lands.
The three reasons
- 1
Mobile attention share is worth $100bn+ and Nintendo's IP is perfectly placed to capture it
- 2
WiiU sales keep disappointing despite a $50 price cut — consoles no longer move the casual gamer
- 3
King Digital went from $8m to $568m net income on just $15m of capex — mobile ROIC dwarfs hardware
Primary demands
- Develop and sell Nintendo games on iOS and Android via the App Store and Google Play
- Partner with or acquire an experienced free-to-play development studio (Top 10 grossing) to de-risk the transition
- Embrace platform-neutral, in-game revenue (free-to-play) economics rather than tying future to proprietary console hardware
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- Netflix 2013 platform-neutral distribution (House of Cards across iPad/TV/smartphone)
- Facebook acquisition of WhatsApp for $19bn
- King Digital US IPO prospectus (Feb 18, 2014)
- Zynga acquisition of Natural Motion Games for $527m
Notable slides (1)
Notes
Three-page open letter from Seth Fischer (CIO, Oasis Management, Hong Kong) to Nintendo CEO Satoru Iwata, a follow-up to an earlier letter dated June 11, 2013. Document is clearly dated February 26, 2014 on the cover and all page headers — the filename prefix '2016-08' appears to be incorrect/archival mislabeling. Tone is strikingly polite and analogy-driven rather than adversarial: Fischer uses Netflix, WhatsApp, King Digital and Zynga as templates, never names a villain, and even invokes Iwata's own 'history of pivoting' phrase supportively rather than as a gotcha. No stake disclosed, no price target, no quantified upside. Scanned PDF with visible OCR artifacts ('repofts', 'Febrr-rary'). Historically notable: this letter presaged Nintendo's eventual mobile pivot (DeNA partnership 2015, Super Mario Run 2016, Pokémon GO licensing).