[Video Games] The Underdog Tale Of The 3DS: Nintendo’s Fight to Stay Above Water And the End Of the Handheld Console
As the gaming industry prepared to enter the eighth generation of consoles, Nintendo was eager to jump ahead of its competitors as sales waned for their old portable and home devices. The DS had wrangled over 150 million units sold by the end of its life span, blowing out its portable predecessors and to this day remaining the most successful Nintendo console and the second best selling system of all time. With the massive profits of their latest handheld, not to mention the Wii’s similar level of success, the company hoped to continue their domination on both fronts of the console war. In early 2010, Nintendo started off sprinting by announcing the 3DS, set to be unveiled at E3 that June and scheduled for release in 2011. With huge progress in portable technology and boasting much stronger graphics on top of new innovations, primarily its 3D technology, fans and critics were excited to discover what seemed to be the next evolution in handheld gaming.
Unfortunately, the 3DS would prove to be one of the last dedicated portable consoles and the end to Nintendo’s family of handhelds. Marred by a bad launch, spotty support, and lost amid an evolving landscape and the dominance of mobile gaming: the 3DS would spend the rest of its life fighting to prove itself in a quickly evaporating market while Nintendo struggled to stave massive financial losses.
A Three Dimensional Device
While not required, this serves as a sort of companion piece to my Vita write up. I suggest looking at that write up for extra context about the Vita and Sony’s own woes in portable gaming at the time if interested since I will be mentioning it here.
As already stated, the 3DS would be shown to the public at E3 in June 2010. There was already some controversy with such an early Spring announcement, with some arguing that the system would hurt the sales of the latest DS iteration still being sold. More importantly, and I promise not to beat a dead horse, mobile gaming had started taking off during the turn of the decade. About $800 million in revenue, or about 4% of the total gaming market in the US, came from titles that could be found on nearly every flagship phone. Not too shabby considering Clash of Clans and Candy Crush were still years away. Still, Nintendo was quick to assuage concerns with their bold new direction in gaming. Then CEO Satoru Iwata came out on stage, showcasing the system’s 3D capabilities and unveiling a plethora of first and third party titles. A revival of Kid Icarus, commitments to new titles from franchises like Kingdom Hearts and Metal Gear Solid, and tried and true money makers like Zelda and Kirby. The device itself included backwards compatibility with the DS, a joystick, a 3D slider to control the display, and stronger processing and graphics that could almost compete with the Gamecube.
There was certainly hype for the device, but as the world got closer to its early Spring 2011 release, more and more details came out that sparked heavy criticism. Mobile games, as always, were only getting more popular as it reached new consumers, and the $250 price point for the handheld console threw many consumers for a loop. That 3D display, while nice, wasn’t exactly perfect with the specific distance and angle needed to ensure it would work, and Nintendo even had to officially warn parents not to let young children use the effect for health concerns. Soon after launch, that concern would be raised once again as many gamers stated they were unable to use the 3D effect for long periods of time, citing eye strain and headaches. On top of all that, a lackluster list of launch titles further damaged hype, with Pilotwings and a bunch of third party ports being the most fans could look forward to during the launch window.
In spite of these issues, the 3DS would keep its launch date and receive overwhelmingly positive reviews, though the costly upfront price definitely soured some on the device. Overall though, with the support of fanatics and critics alike, Nintendo was projecting 4 million units total by the end of the fiscal year in April. While some were far more pessimistic, the company was hoping they could set the world on fire yet again.
A Failed Take Off
So, most people who followed the lifespan of the 3DS would probably tell you that it did pretty poorly at launch. While that would be true in the coming months, initial projections actually saw the 3DS perform far better than its predecessor during its initial release. Rolling out from late February to early March, the 3DS broke sales records in Japan for any system, and was becoming the fastest selling Nintendo console (and sometimes THE fastest selling console) in numerous territories including the US. Yet, these numbers would ultimately fall far short of the lofty four million devices Nintendo hoped would fly off shelves.
By the end of April, Nintendo had only sold 3.6 million units. Still a lot, still way more than probably some critics were expecting, but the spectacular launch failed to create momentum and subsequent weeks saw cratering sales in comparison. It seemed that outside of the hardcore fanbase, very few saw much reason to buy another DS, especially at exuberant price. Even Satoru Iwata was open about the company’s disappointment:
[Iwata]: We originally expected that the value of 3D images without the need for special glasses would be automatically spread to some extent by many consumers experiencing the device by themselves and then playing with the pre-installed software like Nintendo 3DS Camera, AR Games and Face Raiders together with people around them...However, as a result of analysis of the situation after the launch, it has become clear that we need to do a lot more to convey the value to consumers.
Already, some were pointing out the big concerns many had for the handheld upon release, wondering how well it could sustain itself in a world where mobile games were quickly catching up to, and surpassing portable devices. Even ignoring whether or not the 3D and other novelties were ever a draw, especially for what Nintendo was asking for, the console also suffered from a nonexistent online service that wouldn’t fully launch until much later and would have to wait months for a killer app to release. Furthermore, the PS VIta (previously called the NGP) was unveiled earlier that year, and stole headlines with its powerful technology and graphics that rivaled home consoles such as the PS3. By Summer, things weren’t improving even as Nintendo US President Reggie Fils-Amie pointed out that the company was quickly addressing the device’s problems, namely the poor line up and network updates. Nintendo would also hype up many ambitious titles to be released throughout the year, ranging from an Ocarina of Time remake to a new Luigi’s Mansion, trying to fight back against sliding sales with countless new games.
Still, this was really only delaying the console’s slow decline. If Nintendo were to reverse course, the company needed to commit to massive changes in its operations and positioning of the handheld. The company would do just that in July when, less than six months after launch, Nintendo would slash the price of the console to $170 in what would be the start of Nintendo’s massive gamble to save the 3DS.
Identify, Innovate, Improve
This was unprecedented, especially for Nintendo. The company had cut the price of its new handheld by over 30%, taking massive losses on selling the device just to push it out the door. But this wasn’t just some desperate plea. Nintendo would immediately begin attempting to right the ship with a slew of announcements ranging from new system sellers to complete redesigns throughout the rest of the console’s life. And that started by immediately assuring buyers that Nintendo was not abandoning the 3DS.
Satoru Iwata would publish an open letter in Japanese to first adopters, apologizing for the huge price change and promising that this cut was necessary to save the system. Iwata promised that Nintendo would deliver on its promises, and offered up the Ambassador program as a form of apology and gesture of thanks for their support.
[Iwata]: If the software creators and those on the retail side are not confident that the Nintendo 3DS is a worthy successor to the DS and will achieve a similarly broad (user) base, it will be impossible for the 3DS to gain popularity, acquire a wide range of software, and eventually create the product cycle necessary for everyone to be satisfied with the system.
Those customers who purchased the 3DS at the very beginning are extremely important to us. We know that there is nothing we can do to completely make up for the feeling that you are being punished for buying the system early. Still, we would like to offer the following as a sign of our appreciation to you.
That aforementioned Ambassador Program was an ambitious attempt at “making up” the additional $80 fee early adopters took on, offering ten free preselected NES and Gameboy Advance games, or twenty games overall, that could be directly downloaded to the console. Whether or not this was enough to tide over the discontent early adopters may have felt for the sudden price cut, it was at least a peace offering as Nintendo raced to release new titles before the holidays. Profits were already falling massively from the days of the DS and Wii, and a stronger library was needed if Nintendo wanted to capitalize on this massive price cut.
Luckily, the 3DS did start picking up steam, posting over four million units in Japan alone by the end of 2011 as both Mario Kart 7 and Super Mario 3D Land quickly became massive successes. The price cut certainly helped boost sales temporarily. Unfortunately, it was already too late to curb the massive hole in profits, and Nintendo had just posted significant losses in its Fall quarter. Though only the first loss the company suffered in three decades, weak 3DS sales on top of dwindling DS and Wii shipments firmly put Nintendo in the red, and the company would not recover for over four years.
In the meantime, the 3DS would slowly push against the tide with a plethora of new announcements in 2012. Mario titles continued to sell like hot cakes, long awaited announcements like Kid Icarus: Uprising finally dropped, and by the end of its first birthday the device had officially crossed 4.5 million units in the US, and nearly 15 million world wide. In June, the first of many redesigns was announced with the 3DS XL in June, featuring a much larger screen and other small improvements for $200- staying well clear of the system’s initial price woes. But again, by the end of the year the system was still contributing to massive losses, and Nintendo could only fight to stay above water as they waited for the release of the WiiU in November. If nothing else, the handheld certainly held its ground during the holiday season, even outpacing the DS when compared to the latter’s sales during its first two years on store shelves. Yet every step forward seemed to be met with two steps back.
Luckily, 2013 would bring much better news. Another redesign was introduced called the 2DS, a cheap $120 iteration with no clamshell or 3D effect. Certainly a weird attempt at trying to cater to new audiences, but it made clear how unimportant the 3D effect that made the system revolutionary at the time was becoming. Regardless of whether this new iteration was successful or not, the device would actually begin gaining ground. The system would push over eleven million units in the US, and more importantly was seeing healthy software sales that climbed massively by the end of the year. The release of Pokemon X and Y certainly did some heavy lifting, but other smash successes like Animal Crossing: New Leaf and Link Between Worlds managed to pull in sizable audiences. Ardent fans and newspapers praised the system’s quick turn around when it came to the software, managing to create a solid lineup of games that may not have pulled people in droves, but at least kept them coming back for more. And obviously, the announcement of the latest Smash Bros. on both 3DS and WiiU created a lot of hype. While a successful lawsuit would force Nintendo to pay up royalties for each 3DS sold, the company was likely encouraged by the handheld’s continued survival, especially compared to the now floundering Vita and downward sliding WiiU.
The Underdog Success Story
After a quiet first half of 2014, during which Nintendo would continue to announce further losses as a result of both their consoles underperforming, the second half would see a reversal of fortunes as several newly anticipated titles would finally land. Smash Bros as well as Pokemon Omega Ruby and Alpha Sapphire would lead the holiday charge, selling millions within a few weeks. On top of that, the New 3DS, yes that’s its name, was announced and released just before the beginning of next Spring. While the better processing and graphics wasn’t the biggest seller, it did help give the system a bit of a boost in early 2015, especially as it endured declining hardware sales despite Smash and Pokemon selling 15 million units combined within a few months.
All together, Nintendo’s strong IP and yearly revisions helped keep the 3DS alive, even if the company wasn’t seeing hardware fly off the shelves. Add in the successful launch of Amiibo (despite all the scarcity problems and other issues that faced these plastic figures), and Nintendo would finally see itself in the green after four years of losses. The company wasn’t in the clear, but it did find itself on stable footing, and that was likely enough to boost confidence and new projects as Nintendo was struck by yet another tragedy.
Just a few months after posting its first profit in years, Satoru Iwata would pass away. He had been president of Nintendo for over a decade, and oversaw the creation of the Wii and DS during his time running the company. The late creator certainly had massive missteps, even one glance at all the turmoil both his latest consoles were going through made that clear. But perhaps there’s something positive that could be found in him overseeing the company’s slow recuperation after half a decade of negativity and decline. He certainly sacrificed a lot to see it, the time he cut his own salary by 50 percent during the 3DS’ massive price cut remains one of the most well known stories about the man. But even if it would never set the world on fire, Iwata and many others at the company helped ensure the 3DS could find a place in a completely changed and hostile market. The system would continue to help the company turn a profit in the following years, and easily dominate the gaming scene in Japan until Nintendo could move on to new projects. That, at least, is commendable.
[Iwata]: On my business card, I am a corporate president. In my mind, I am a game developer. But in my heart, I am a gamer.
An End To An Era
As the decade passed, Nintendo would slowly recuperate as it prepared to leave the eight generation behind early. The WiiU was not bouncing back, and while the 3DS made a decent recovery, the company couldn’t rely on a now four year old handheld to carry the business for a few more years. Nintendo was still having to cut forecasts year after year, and an abundance of highly successful games and other endeavors like Pokemon Go were doing serious heavy lifting to keep the company up and running through 2016. Before the end of the year, the gaming industry was already turning to rumors about the upcoming ”NX”.
The NX, soon to be revealed as the Nintendo Switch in October 2016, was set to release in March the following year and dominated headlines with its ambitious hybrid design as a portable and home console. It was clear Nintendo was ready to to move on from the DS and Wii, completely innovating once again to create another unique (and hopefully more successful) experience.
Luckily they succeeded. Unfortunately, this would also mean the end of the 3DS.
Within a few weeks, the Switch got off to a strong start, selling millions upon release and enjoying enormous success that Nintendo hadn’t seen in over a decade. While the Switch would become the new rockstar of the entertainment industry, outselling the lifetime sales of the WiiU in a year, the 3DS would continue to chug along in the background. The system was still hanging in there, enjoying sizable boosts during the holidays and pumping out several hits, but it was only a matter of time before it would get replaced. Even as the company repeatedly stated they would continue to support the system, and applauded as it hit 75 million units in late 2019, the Switch had already sold half that amount after a little over 2 years on the market. The 3DS had long since passed its time in the spotlight, and sooner or later Nintendo was going to have to pull all its resources to its newer, more successful system.
That’s probably why it came as no surprise when the system quietly ceased production in late 2020. Practically no major releases had hit the console in the past year, and with the Switch climbing rapidly in the market, there was clearly no reason to keep the nearly ten year old console around. Still at around 75 million units sold by the end of its lifespan, the 3DS was (and likely will remain) Nintendo’s worst performing handheld, not even passing the sales figures of the PSP or Gameboy Advance (both over 80 million) and well below the smash success of the original DS family. Yet it was also a home to countless beloved titles, many of which I haven’t mentioned here. It survived certain defeat, something that couldn’t be said for its most direct rival in the PS Vita, and eventually turned around to help Nintendo regain its former sales glory. It's a complicated legacy to be sure, but in all regards it's largely still a positive one.
The belief was that smartphones would be the death of portable gaming, and the fact the 3DS sold half as many units as its predecessor seemed to back up that notion. Yet what it also showed was there is a very large audience that values the in-depth experience offered by dedicated gaming portables. To some analysts, 75 million sales looked like trouble, but it also represented an audience that a company like Nintendo could build a sizable business around.
As I stated in my Vita write up, it's doubtful the 3DS would have a direct successor if it had sold even, say, 100 million units. Nintendo simply pinned too many hopes on the console to see a repeat of its older sibling’s success, and a timeline where the WiiU was still alive would require a bunch of assumptions and changes to the company’s identity. A few months before the 3DS ended production, mobile gaming revenue had climbed to heights that completely dwarfed the regular game industry. While the Switch has certainly taken many helpful lessons from the failures of both the 3DS and WiiU, it would be difficult to see a reason why Nintendo would invest once again in a dedicated handheld console. Especially as the Switch has long since passed the 3DS in lifetime sales.
Whatever qualifies as a “success” or “failure”, it's hard to say the 3DS became the system Nintendo truly wanted it to be as the handheld sought to justify its existence each passing year. The company did almost everything it possibly could to sell the device to a dwindling market it was initially too slow to realize was surpassing it: taking massive losses, producing countless titles, constantly cutting expectations, releasing constant redesigns to drum up hype. The 3D visuals Iwata and the company emphasized probably never really appealed to more than a niche audience. But the system is still beloved by many, sold plenty of units, far and away beat the Vita in a race that admittedly was a sideshow to the smartphone market, and has a plethora of games that are difficult to find anywhere else (though Nintendo definitely isn’t helping with that last part). 75 million units is a steep decline from the DS and Nintendo's old handhelds, but it was still far more than I expect people believed it could do in 2011. The system was an underdog through and through, and like the Vita, it’s found a sizable audience that still enjoys the device to this day and a massive list of games that helped keep Nintendo alive for the future.