Visitors are seen at the Tokyo Game Show in Chiba, East of Tokyo, September 16, 2010.
Credit: Reuters/Yuriko NakaoBy Elizabeth ReynoldsTOKYO | Mon September 12, 2011 12:46 am EST
Tokyo (Reuters)-in a world of growing smartphones and tablets, providers of social games will be featured at the Tokyo Game Show this week, while the champion Nintendo, criticized for being too focused on hardware, fight to win back the fans.
As sales of conventional games sputter, mobile social games company Gree and DeNA rival views are well placed to qualify, given their success with the previous generation feature phones.
GREE marks his debut in the show of Japan annual game, which goes from 15 to 18 September of this year, with one of the biggest booths.
It is estimated that the social gaming market of Japan, usually involving simple games played on mobile devices with anonymous contacts online, grow to around 400 billion yen (US $ 5.1 billion) in 2013 of 106 billion yen in 2011, extending its rapid growth, Mitsubishi UFJ Morgan Stanley analyst Masato Araki said.
Nintendo, which does not participate in Tokyo Game Show, maintains its own event on 13 September.
The Kyoto company is expected to unveil new software 3DS with his character of 25 years, Mario, and there are also market conversations about a joystick, already sacked by analysts and bloggers like unlikely boost sales.
Software publishers from Japan are shifting resources to develop the new generation of social games, but Nintendo is effectively deleted, any attempt to make the leap to delivery of content to devices from other companies would further undermine already weak sales of its Wii and 3DS.
"Nintendo did some terrible things-no software, poor prices, poor PR, no sign of a sustainable turnaround, software support dropping like flies," said JP Morgan analyst Hiroshi Kamide 3DS announcement failed.
Konami software vendor, on the other hand, had done something relatively simple, but with great execution, said Kamide. "You can do serious returns with social games in Japan, if well done and that is exactly what they have done."
The change of fortunes is no less marked in stock prices, where Nintendo, which long dominated the industry, appealing to everyone from pre-school to pensioners with your Wii and DS, hardware has fallen 42 percent since April 1, hit by its shocking inability new gadget, the DS portable 3.
Gree's shares soared 84, DeNA's up 29 and Konami jumped 86 percent.
Looking to drive sales of videogames before the holiday season, Sony Corp cut the price of its PlayStation 3 gaming console base by almost a fifth in the United States.
CASUAL GAMERS
Many casual players are flocking to blockbuster devices such as Apple's iPhone and iPad, eat in Nintendo's market share, while Google and Facebook are also making a major push into games.
"Nintendo needs to be more social and digital and will strive to do it as he will not give up its strategy of combination of hardware and software, said David Gibson, head of research at Macquarie Capital Securities.
Highlighting the industry's downturn, physical sales of gaming hardware and software packages in the United States fell 23 percent in August from a year ago, according to research firm NPD.
Nintendo sold just 710,000 units of the 3DS in April-June, compared to 3.6 million in the month following its launch and a small fraction of its 16 million unit target for the year to March 2012. [ID: nL3E7IS1R8]
Reducing the price of 3DS for about a third have driven unit sales, analysts say, but it is not known how long it will last the effect, leading some to call on Nintendo hardware to completely remove.
But the example of Sega is increasingly being cited as a reason for Nintendo to maintain its current structure.
Once a force to be reckoned with in video games, and sporting the popular Sonic Hedgehog character, Sega fell out of the home consoles hardware market a decade ago.
Sega clung in as a software editor for other platforms, but two years later, his creative drive apparently fading, it was assumed by the company of Salon "pachinko" pinball Sammy.
The withdrawal did little to improve the financial situation of Sega and company employees had made it harder to recruit sayd output and retain talented employees.
Some industry experts say that Nintendo Games can successfully fight again as it has done in previous crises.
"Nintendo has fallen into a slump twice in the past," said Osamu Inoue, the author of a book on the giant secret. "He almost went bust after diversification in early 1970," he added, recalling that the launch of the Wii and DS has saved the company again after years of losing to Sony's PlayStation.
(US $ 1 = 77.45 Japanese yen)
(Editing by Anshuman Daga)
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