Breaking with Sony; going it alone with the N64 (1996)

An open market, or a market held

At the core of this decision were two things: Yamauchi’s conviction that a console is won or lost on its software, and the choice to keep that software supply in Nintendo’s own hands. The cartridge-based Nintendo 64 gave Nintendo fast loading and control over volume, but its high manufacturing cost and small capacity made the console harder for software houses to join. The difference between a PlayStation that opened its standard and gathered more than 500 developers and a Nintendo 64 that held its standard and managed supply showed up not in hardware power but in the number and range of games.

What Nintendo protected was a high-margin business — selling information on cartridges — and a system for managing the quality and quantity of software in-house. What it gave up in exchange was the breadth of software houses drawn to the openness of CD-ROM, and the next generation’s market share swung to Sony. Still, the mid-1990s choice to sit out the hardware-horsepower race and compete instead on fun and distinctive play carried on into the line that later drew broad audiences with the DS and Wii. Open the standard and gather numbers, or hold the standard and manage quality — this decision left that question to be re-asked at every console generation.