What's Going on at Nintendo?

By: James Stevenson
Date: Sunday, September 15, 2002

This week, the videogame industry (but more specifically, the Nintendo fanboys) were confronted with the harsh reality of a buyout of Rareware by the corporate giant Microsoft. I had been speculating for months that Rare would eventually leave Nintendo (see last week's Gamers' Thumb) and now it seems to be happening.

First things first, Rare has not been purchased by Microsoft. There are only negotiations. But more importantly, Nintendo has terminated its second-party agreement with Rare. This means that Rare is no longer obligated to create exclusive games for the Nintendo GameCube.

Now more pieces of the puzzle: Nintendo owns 49% of Rare, while the Stamper Family owns the other 51%. The Stampers are ready to get out of the business and reportedly offered to sell their stake in the company to Nintendo, but Nintendo refused and has since then terminated the agreement. One other little factoid: Rare's new swanky offices in England were paid for in part by Nintendo.

Now, what's going on? Why would Nintendo give up a relationship with such a fan-popular developer? Nintendo cites the reason of declining sales. Last year, Rare accounted for only 9.5%

SLY COOPER AND THE THIEVIUS RACCOONUS

of Nintendo sales, and this year that figure is down to 1.5%. But remember, Rare was in a console transition, and one of their big titles for last year, STAR FOX ADVENTURES, was delayed to the GameCube.

So really, while sales have declined, Rare hasn't had much of a chance to release anything. What's really going on? Is it the fact that Rare just isn't producing like it used to, or is Nintendo up to something different?

While overshadowed by the Rare news, Nintendo also terminated its second-party agreement with Left Field. So in one week, Nintendo has terminated two major deals. Another interesting point is that the sale of Nintendo's 49% stake in Rare could be worth somewhere in the $500 million range.

So what is Nintendo thinking? I honestly don't know. I would assume that having Rare on your side, even if they aren't selling a ton of software at the moment, would be better than letting them slide over to Microsoft. Conversely, Rare's biggest franchises, BANJO-KAZOOIE, CONKER, DONKEY KONG and possibly PERFECT DARK, are owned by Nintendo, so those franchise games will always be exclusive to Nintendo, whether or not they're developed by Rare.

TIDBITS

Sega has delayed PANZER DRAGOON ORTA until 2003... A demo of UNREAL TOURNAMENT 2003 has been released... THE LEGEND OF ZELDA will be released on December 13^th in Japan... EARTH AND BEYOND has gone gold... Konami will release new TEENAGE MUTANT NINJA TURTLE games... A court case in Greece prosecuting three men for playing video games was thrown out, the anti-gaming law will be challenged as unconstitutional... WARIO WORLD has been delayed until 2003...

ON SHELVES

Two fantastic games are coming out this week.

STAR FOX ADVENTURES

First up is Sony's SLY COOPER AND THIEVIUS RACCOONUS for the PlayStation 2. Secondly, we have Square and Disney's joint venture, the action-RPG KINGDOM HEARTS. Both are great games that lead up to the release of next week's STAR FOX ADVENTURES.

Gamers' Thumb is our weekly Video Game column.

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What's Going on at Nintendo?

TIDBITS

ON SHELVES

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