Videogame publishers in surprise move back Nintendo

LOS ANGELES Thu Jun 9, 2011 4:35am IST

Reggie Fils-Aim, president of Nintendo of America, presents the new Wii U controller at a media briefing during the Electronic Entertainment Expo, or E3, in Los Angeles June 7, 2011. REUTERS/Mario Anzuoni

Reggie Fils-Aim, president of Nintendo of America, presents the new Wii U controller at a media briefing during the Electronic Entertainment Expo, or E3, in Los Angeles June 7, 2011.

Credit: Reuters/Mario Anzuoni

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LOS ANGELES (Reuters) - The world's biggest video game publishers, in a surprise move after years of rocky relations with Nintendo, threw their weight behind the Japanese company's new Wii U console this week.

The chief executives of Electronic Arts and Activision Blizzard, the largest U.S, video game publishers by sales, told Reuters at the Electronic Entertainment Expo that the Wii U presents a growth opportunity for the struggling $65 billion video games industry.

In the past, publishers have backed away from dedicating too much content to Nintendo platforms, since the Japanese company tended to use its consoles to push its own software titles. The original Wii also did not feature the high definition graphics deemed crucial to running first-person shooter titles at their best.

But at E3 this week, both EA, known for its sports titles, and Activision Blizzard, the owners of the Call of Duty shooter franchise, voiced strong support for Nintendo.

The new console revealed on Tuesday is the first Nintendo device to support high-definition graphics. Its controller sports a 6.2-inch touchscreen that works like a second display and can either replicate the images on the main screen or provide gamers a second screen with additional information.

This second screen particularly appealed to EA Chief Executive John Riccitiello.

"That second screen gives us so much in the way of game play opportunity. It's mindblowing," he said in an interview.

Users playing EA's "Madden NFL" could draw patterns for football plays on the screen, while fans of first-person shooters could design missions or control weapons from it, he added. Multiplayer gaming, or games that users play online against friends, could also benefit from the screen.

"Having that private screen vs a public screen for multiplayer gaming is huge," Riccitiello said.

NEVER BEFORE

Working so closely with Nintendo was new to the software company. Riccitiello said he visited Japan several times to work on understanding the new platform. He also appeared onstage during Nintendo's press conference, something he has never done before at E3, the industry's biggest annual convention.

"This is the first time we've worked so closely with Nintendo," he said.

Activision Blizzard did not publicly partner with Nintendo during E3, but Chief Executive Bobby Kotick also got in line to voice support for the Wii U.

"It should be a successful product," Kotick said, adding the user interface on the controller will appeal to gamers, as well as its ability to stream video. "We're supportive of all of the hardware."

The Wii U's controller can also make voice calls, comes with motion-sensor capabilities and works in conjunction with existing Wii controllers. With its array of buttons, the device could appeal to hardcore gamers who could use it for first-person shooter games.

While publishers have reacted well to the Wii U, saying it could could jumpstart software sales in the lagging global video game industry, the investment community reacted differently to the news.

Nintendo's shares fell to a five-year low in Japan after investors complained the Wii U did not address fears that the company may be missing the gaming market's shift to social networking.

Tim Pollak, portfolio manager of Electronic Entertainment Fund, argued that the shares fell because of the far-off launch date. The console is supposed to be released between April and December 2012.

"Investors with shorter time horizons reacted negatively to the timing to market," Pollak said.

At least one investor said he was puzzled by the share drop because he saw big things ahead for the new device. Kelly Cardwell, managing partner at Chicago-based Central Square Management Fund, said he bought additional shares of Nintendo on Tuesday.

"I am very bullish on the Wii U and all the potential here for Nintendo," he said.

(Editing by Edwin Chan, Bernard Orr)

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