Nintendo to Spend $900 Million to Expand 1st Party Studios, “Not Dismissing” Acquisitions

Nintendo Switch

Console makers are in an arms race right now, with both Microsoft and Sony aggressively looking to expand their software-development capabilities by buying and founding new studios. But what about Nintendo? The current console market leader has always been more cautious than its competitors, but is it amping up its development capabilties as well? The answer is yes.

As part of their latest financial briefing, Nintendo announced plans to spend up to 100 billion yen (or around $900 million) on expanding the development capabilities of their internal studios. Mergers and acquisitions aren’t being ruled out, but for now, the focus is on 1st party studios…

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We aim to expand our game development frameworks inside the Nintendo group. We are not dismissing the possibility of [merger and acquisition] activities, but our first priority is to organically expand our own organization to continue Nintendo's creative culture. In addition, we will pursue opportunities in non-game entertainment businesses that have high affinity with the game business. To that end, we will work to build software assets in fields other than games. We will also work to develop new video content, following on from the Super Mario movie.

Interestingly, Nintendo is planning to spend even more, 300 billion yen ($2.7 billion), on user experiences and services. As we already reported, there are plans to further expand Nintendo Switch Online, but they also aim to create a new unique user infrastructure and improve their digital stores and My Nintendo service. Nintendo doesn’t come right out and say it, but it sounds like they’re eying the success of Xbox Live and PlayStation Plus, and perhaps even subscription services like Xbox Game Pass, PS Now, and EA Play. Obviously, this kind of online connectivity has always been a huge, glaring weak spot for Nintendo, but it seems like they’re dedicated to devoting the resources to make it better.

What do you think the future of Nintendo holds? Are they investing in the right places?

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