Nintendo addresses Switch 2 price, supply versus demand, and Game-Key Card concerns

Nintendo has addressed concerns regarding the Switch 2’s high price point, supply versus demand, and issues regarding Game-Key Cards.

During a general Q&A at its annual shareholders meeting, Nintendo president Shuntaro Furukawa told investors that the console’s price “is appropriate for the gaming experience that it offers”.

When asked whether the firm had concerns if the price would “reduce opportunities for young children to engage with the console”, Furukawa said Nintendo was “closely monitoring to what degree the price of the system might become a barrier.”

Speaking of price, there were also concerns that the hardware improvements of the Switch 2 could affect development costs and higher software prices.

“Recent game software development has become larger in scale and longer in duration, resulting in higher development costs,” Furukawa noted. “The game business has always been a high-risk business, and we recognise that rising development costs are increasing that risk.

“Our development teams are devising various ways to maintain our traditional approach to creating games amidst the increasing scale and length of development. We believe it is important to make the necessary investments for more efficient development.”

He continued: “We also believe it is possible to develop game software with shorter development periods that still offer consumers a sense of novelty. We see this as one potential solution to the concern about rising development costs and software prices, and we will explore it from various angles within the company.”

Looking at demand for the Switch 2, Furukawa noted that it is “exceeding supply in many countries”, particularly in Japan.

“We will continue to strengthen our production and supply systems to deliver as many Switch 2 systems as possible to our customers”

The Switch 2 was the biggest console launch in Japan, with 2.2 million people applying to pre-order the console. It also broke US console launch week records.

“Regarding the sales situation in Japan, in early April we began accepting applications for purchase by randomly selecting drawings from people who met certain criteria on My Nintendo Store,” said Furukawa. “The number of applications greatly surpassed our expectations.

“We will continue to strengthen our production and supply systems to deliver as many Switch 2 systems as possible to our customers.”

This criteria in Japan includes having a Nintendo Switch Online membership for a minimum of 12 months, being the person who purchased any NSO membership, and having opted in to share gameplay data and have at least 50 hours of total gameplay hours.

Similar restrictions were given to customers pre-ordering via My Nintendo Store in the UK and the US.

When asked why Nintendo applied these pre-order restrictions, Furukawa stated that it was to “offer consumers who have actively been playing the Switch a prioritised opportunity” to purchase the Switch 2.

“That being said, we have received a wide variety of feedback on this randomly selected drawing format, both positive and negative,” he said. “We will analyse this feedback internally and use it as a learning experience for the future.”

Shareholders also expressed apprehension regarding Game-Key Cards, in which the cartridges act as keys to unlock a download rather than storing the game.

Back in April, publishers shared their concerns with GamesIndustry.biz regarding this change and the impact it may have on game preservation.

“Seeing Nintendo do this is a little disheartening,” said Nightdive Studios CEO Stephen Kick. “You would hope that a company that big, that has such a storied history, would take preservation a little more seriously.”

In response to investors, Furukawa said Nintendo will “continue to work closely with publishers” to support the various distribution methods offered on the Switch 2.

“This is one of the new software distribution methods we have introduced to accommodate the larger game data sizes on Switch 2 compared to Switch,” he explained.

“Software can be released in various formats, and we will continue to work closely with software publishers on many fronts to ensure that they actively support our platform.”