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Hiroshi Yamauchi retires from Nintendo - by Marty "Retro Rogue" Goldberg

One of the second generation wide screen Game and Watch systems, Egg was released on the 9th of October in 1981
By the early 1980's, Nintendo's Game & Watch sales were keeping the cash flow coming in. LCD based handheld games, Hiroshi had planned to take advantage of the handheld market created by companies like Mattel and Coleco as cheaper versions of their LED based games. They became quite popular in Japan, however due to poor marketing by the newly formed Nintendo of America, they flopped overseas.

It was an arcade game meant to replace the disappointing Radar Scope that was to have the first dramatic and truly lasting effect for Hiroshi and his Nintendo. Created by a young employee that Hiroshi had taken a chance on hiring, Donkey Kong became a huge success world wide. Not only establishing Nintendo as a mainstay in the arcades, it helped cement Nintendo of America and introduced what was to become the company's mascot - Mario.

The Famicom system with it's optional floppy disk attachment released in 1986.
Next on Yamauchi's list was to create a console to beat all consoles for the home video game market. Insisting it had to beat every other console's specifications and abilities, through his guidance the Nintendo Famicom was eventually created. Famicom (short for Family Computer) was intended as a console and marketed as such. Hiroshi wanted nothing to stand in the way of getting across what it was actually for - playing games. But, it was in actuality a small computer, with some peripherals planned for later release. Released in 1983, it became a huge hit in Japan, and once the home video game market in the United States died in 1984, Hiroshi saw the opportunity to further expand Nintendo's dominance overseas.

The original NES, complete with R.O.B. - the Robotic Operating Buddy, created to convince toy dealers it was an "Entertainment" and not a "Video Game" system.
With the help of son-in-law and Nintendo of America president Minoru Arakawa, Hiroshi used the strategy of marketing through toy and department stores to get the Famicom in to consumers hands at a time when "video game systems" were considered the black plague. To strategically drive through to dealers and consumers they had nothing to do with the old "video game industry" Hiroshi and company marketed it as an Entertainment System rather than a video game system, and the Famicom was renamed the Nintendo Entertainment System (NES). The strategy worked, and by 1986 Hiroshi and the NES had revitalized an industry thought dead.

Once again not content just to have hit sales, and as always needing complete control and dominance over everything he had his hand in, Hiroshi introduced practices that were to define the industry to this day. Weary of the problems Atari had faced with hordes of low quality, unlicensed games Hiroshi introduced the lockout chip. Games would only work on the console if they included the proper identification to the NES console. And you could only get the technology needed through Nintendo (for a while at least). This also meant, you had to get approval from Hiroshi and Nintendo's game testers to market your game, buying a development license. If they thought the game sucked, it'd never be seen on any NES console - no matter how much you might have spent in development. This also meant that most of the games released for the NES were to Hiroshi's taste - in most cases very kid friendly games. And as if to further extend his control, all cartridges to be sold had to be manufactured through Nintendo. All this combined to make Nintendo the number one video game manufacturer in the world, as well as one of the most successful companies in the world.

Hiroshi continued to guide Nintendo through the 1990's with successes like it's eventual dominance of the handheld video game market with it's GameBoy series. However, the 90's also saw many not so favorable changes with Hiroshi's Nintendo juggernaut. Loosing it's unchallenged market standing when Sega's Genesis system hit hard against the Super Nintendo Entertainment System (and in many cases put Sega in the forefront), Hiroshi also unwittingly created his own best competitor when he cancelled a cd-drive expansion for the SNES. Not to be left flapping in the wind, the partner on the design and manufacturing of the cd-drive (Sony) turned around and released the technology as the Sony Playstation. And with that, Sony soon replaced Nintendo as the number 1 video game company in the world. Even Nintendo's response, the Nintendo 64 (itself a cartridge based system) and it's hordes of Hiroshi approved hit game titles (such as Pokeman) couldn't put it back in the forefront. Likewise, failures like the mid-90's Virtual Boy system (Don't remember that one? You're certainly not alone) didn't help.

The Nintendo Game Cube.
And it's at this time, a time that many feel to be the most critical in Nintendo's future, that Hiroshi is choosing to step down. His GameBoy Advance is of course a success, however the GameCube is not the great success that was hoped for (as with the N64 before it, Hiroshi was hoping to beat the competitors by being different. The storage medium uses special mini-discs rather than standard size DVD's. And as such the GC is being pushed as a pure game console - no DVD movies or other home entertainment amenities). Competing in a market with Sony's Playstation II in the dominant position, along with new competition from game industry cloddish Microsoft and it's X-Box, Nintendo's future place in the industry is in many ways uncertain.

Not one to completely abandon what's been his life all these years, Hiroshi will remain on in a purely advisory position. Proving how hard it would be to replace such a powerful figure, the power is not being transferred to a single person, but a management team consisting of six people. Most of the team will consist of many of the handpicked management and engineers that created successes like Donkey Kong and the Famicom/NES, to ensure Hiroshi's vision lives on. This includes the strategy of competing on the strength of innovative games rather than the console itself.

"My job now will be simply to keep an eye on the whole process."

- Hiroshi Yamauchi

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