Nintendo's Iwata says layoffs make for worse games

Nintendo's had better years. The 3DS was the best-selling console in the U.S. in May, but the Wii U is looking more and more like a touch-enabled albatross around its neck. Some wondered why Nintendo hasn't cut staff to shore up its bottom line at its 73rd Annual General Meeting of Shareholders.

"If we reduce the number of employees for better short-term financial results, however, employee morale will decrease, and I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world," Nintendo CEO Satoru Iwata responded.

We barely go a week without reporting layoffs or studio closures, but Iwata thinks--at least for Nintendo--that would be counterproductive.

"I also know that some employers publicize their restructuring plan to improve their financial performance by letting a number of their employees go, but at Nintendo, employees make valuable contributions in their respective fields, so I believe that laying off a group of employees will not help to strengthen Nintendo’s business in the long run. Our current policy is to achieve favorable results by continuously cutting unnecessary expenses and increasing business efficiency."

On the other hand, he was noncommittal about the quality of Nintendo's cafeteria food: "Opinions vary considerably," he said in response to one (we imagine slightly glib) shareholder.


  • Fireninjastar - July 9, 2013 1:26 p.m.

    C'mon, Nintendo. At least ONE person must be ruining everything. I just hope it's not reggie :T
  • PlainLikeVanilla - July 8, 2013 5:45 p.m.

    Isn't this just common sense?
  • mafyooz - July 9, 2013 2:58 a.m.

    Not from a corporate point view. Laying people off is the quickest and easiest way to reduce overheads, so that come time for their annual report they can point shareholders in the direction of the operating costs figures and applaud themselves on how much they've reduced operating costs. Purely a short-term solution and tends to come back to bite them on the arse for exactly the reasons he gives, but that's just the way things are when profits are considered more important than people.
  • FlyWire2 - July 8, 2013 4 p.m.

    I wish EA and Acti have heard this before Pandemic Studios and Bizarre... *sniff*
  • FoxdenRacing - July 8, 2013 2:36 p.m.

    I'm reserving judgement on the 'albatross' thing until after the other two launch. Is the U struggling because it's not resonating, or is it struggling because a new console generation is starting while the global economy is largely in the tank?
  • BladedFalcon - July 8, 2013 3:31 p.m.

    Considering it's general lack of games, I'm gonna go with the former... Also, there's the fact that I think I read the pre-order numbers for both the PS4 and Xbone have been the biggest there has ever been for any console, so that doesn't look like a bad sign. Of course, pre-ordering stuff wasn't as easy or as popular before, so maybe it isn't that accurate of an indicator.
  • FoxdenRacing - July 8, 2013 4:18 p.m.

    I'm not holding my breath either, but don't have any good sources for actual numbers on preorders...not for this gen, or any previous. One other thing to consider [along with the ease of preordering] is what gaming going mainstream has done for the machines that get CoD...millions of people in a single market that will buy a system for that one game. What I'd love to see is worldwide numbers vs time on the market going back as far as the 6th [PS2] or even further, but I'm struggling to find any. It's all either single country or single generation. The best I can find is this one [], which is Japan only, but has a lot of systems to compare to. It puts 400k units in Japan as a good opening week, and the U at a solid, but not outstanding, launch...neither a spectacular seller [like PS2, DS], nor an abysmal opener [PS3, Dreamcast]. The first 3 weeks it kept pace with Wii, and had only been significantly outsold by PS2, DS, and GBA...all products of a bygone era where money was plentiful and systems were cheaper. In my travels I also stumbled across some clown trying to pass himself off as an analyst suggesting XBone is going to hit 400M lifetime sales...over 5 times what X360 has to date, 4 times what the entire Xbox division has moved since its inception, and over 2 1/2 times what PS2 sold. Um, hi. Have you met the games industry? Anyway, I'm not happy with any of the data I'm's all apples to oranges comparisons; it's keeping up with anything that's launched since the global economy tanked; if nothing else, and it's going to wallow until the heavy hitters roll in...but if they don't gain some momentum before the others launch...especially PS4, since that'll have worldwide's going to be game over, they're not going to come out in number of units sold.
  • J-Fid - July 8, 2013 2:32 p.m.

    He makes a great point.
  • Cyberninja - July 8, 2013 1:56 p.m.

    I would love to here what the people who feel Nintendo should go third party have to say about this
  • BladedFalcon - July 8, 2013 3:38 p.m.

    What is there to say about? They treat their employees right, and that's wonderful. But that doesn't automatically make everything Nintendo does as a first party company great :P
  • Cyberninja - July 8, 2013 4:49 p.m.

    I understand that, I am still waiting for more Wiiu games myself, but I would say they don't make many mistakes in the long run.
  • BladedFalcon - July 8, 2013 5:06 p.m.

    ....The N64 was a huge mistake in the long run :P (Not to mention the Virtual Boy...) Every single company makes or has made huge mistakes. No one is except, but whether people want to admit it or not, Nintendo is falling behind the curve with the Wii U, and if it's struggling now, it's only going to get worse once the new consoles arrive and hit their stride, I could be wrong of course, but if this ends up happening, you'd have to admit, it would make the entire Wii U a huge mistake in the long run :P (One that would pretty much cancel out the unexpected success Nintendo had with the Wii.)
  • LordZarlon - July 8, 2013 5:41 p.m.

    While I am a Nintendo supporter, I do agree with you that their strategy with the Wii U has not been successful. I think it is important to note though that, while we all say that Nintendo doesn't "get it", they still manage to survive. Before you say, "'Surviving is not being successful", my point is that they still manage to produce little gems for us to enjoy. Is this a defense of their overall strategy? No. I do fear for their long term existence. If they insist on being essentially a Nintendo first party machine though, they need to lower the price. If I have to pay for a PS4 or XBone, the Wii U needs to be considerably cheaper for me to buy it just for first party games.
  • BladedFalcon - July 8, 2013 10:02 p.m.

    Well, but would lowering the price be enough? The GameCube was a pretty affordable machine, maybe not the cheapest, but I don't think anyone ever accused it of being expensive. And yet it didn't do that great even though it was pretty much a first party machine just like the N64 was XD Also, I think another problem is that even Nintendo's First party offerings, while still of quite a lot of quality, seems to be running out of original or new ideas. And i don't mean creating new IPs, but even revitalizing their existing ones. Even as a Nintendo supporter, I think you can agree that it's kind of a letdown that instead of a new metroid, or a new Star Fox, a new f-zero, or even a properly new, full fledged Mario or zelda game, you're instead getting another Mario Kart not two years after the previous one, another Donkey Kong game that looks essentially like the first one gameplay-wise, and a Mario game that is a essentially a sequel to a PORTABLE mario, but now with multiplayer. Even the new Smash Bros game looks like more of the same, not saying that's bad per se. But you can see what i'm going with this?
  • LordZarlon - July 9, 2013 5:46 p.m.

    This is simply an excellent point you have made BladedFalcon. What excited me over the years about Nintendo was that, even if their console was in a solid 3rd place like Gamecube was, we got incredible new takes on old franchises. My favorite game of all time is Super Metroid and when I saw Metroid Prime running in a Gamestop kiosk I almost shed a tear. Where's the innovation? I love what I've seen so far but I need to see a lot more from Nintendo before I invest in a Wii U. I might get a 3DS though.
  • Cyberninja - July 8, 2013 6:37 p.m.

    Well not really I feel the wii did do fine, even if that was your only console(it was mine for a few years), I really feel they will hit their stride after they release all their stuff later this year, while PS4 and Xbone try to find their footing since as of this post I see nothing on either that makes me want to grab PS4 day 1 or an Xbone ever, since the coolest looking stuff is coming out on almost all consoles.
  • BladedFalcon - July 8, 2013 9:53 p.m.

    Well... you're speaking from an entirely subjective standpoint. TO YOU the Wii did fine, TO YOU The stuff that the Wii U is releasing is more attractive than anything the PS4 or Xbone has to offer so far. Which is fair enough if you're talking about YOU. But surely you can understand that Nintendo isn't gonna be sustained by YOU only, don't you? :P The Wii might have done fine for you, but for a LOT of other people like myself, it never really did enough to justify itself, just as the Wii U is failing to do now. And that showed specially on the Wii's last years. The problem with the Wii U, (and all nintendo's main consoles since the N64.) is that yes, it appeals to people that love nintendo's products more than anyone else's, like you are. But it doesn't appeal to a lot more other groups, groups that like more quantity of games overall, or want more "mature" experiences, or simply the variety that comes with being supported by companies other than just first party. And thus, while you may be perfectly happy with the Wii U as it is, it's sales show that most people clearly aren't, and once the other next gen platforms start to grow their catalog, The Wii U is definitely gonna suffer more, whether you like it or not, thus making this consoles design and focus a huge mistake in the long run :P Which is why people like me would rather have Nintendo just give up and become a third party publisher and no longer make consoles. That way we no longer have to spend money on a console that will be worth it mainly to just play their games, and instead we'd be able to enjoy them no matter what console, or even PC we chose. Don't worry though, fortunately for you and people like you, even with the Wii U failing as it is, it's unlikely Nintendo is in any real danger any time soon. It definitely does help that when it comes to portables, they always see to do way better, both financially and regarding game variety.
  • Cyberninja - July 9, 2013 11:55 a.m.

    The problem I see with your reasoning is the WiiU is doing poorly right now, which is before any of the big games come out, I would see the problem if they wiiu was still struggling after the fact, but most consoles have slow launches and first years, like the PS3 for example.
  • BladedFalcon - July 9, 2013 10:08 p.m.

    ...The thing is that the games that are coming out soon aren't as "big" as you wish, or at least, seem to think they are. Not saying they are chump change or that they are bad, i mean, Wonderful 101 is one game I genuinely would love to play. But I mean, all that is coming this fall, Pikmin 3, Wonderful 101, DKC:TF, and even SM3DW are not the real big guns that tend to be touted as the system sellers or justifiers for Nintendo. There's no true Big 3D Mario here, or a Metroid, or much less a Zelda. What I'm trying to get at, is that even with that solid games line-up, I am willing to bet the Wii U will be doing poorly even then. Specially because it will be directly competing against the novelty of two brand new next gen systems arriving. Which, regardless of what you think about their line-ups, you gotta KNOW that's inevitably gonna drive attention (and sales) away from Nintendo. Also, you keep mentioning the 3DS as proof of how the Wii U is gonna make the same comeback. But there's two flaws with your comparison: First, in order to facilitate the turn around, not only had new good games had to come out, Nintendo had to make a very drastic, very quick and significant price cut to the console. Which like it or not played a HUGE part in helping the system sell. So far, Nintendo has refused to cut the price of the Wii U, and it doesn't seem like they'll do it any time soon. Secondly, the 3DS came on it's own not just because of first party games like Mario Kart 7, Super Mario 3D land and Kid Icarus, but also because of proper third party support such as RE: Revelations, Cave Story 3D, Bit. Trip. Saga, Zero Escape: Virtue's Last Reward, FF: teatrhythm. Which sure, none of them aside for RE: Revelations might be a huge brand, but they are quality games that add variety and choice that the Wii U's only one first party quality game per month isn't providing for. In short, the 3DS brought support from all sides, 1st and 3rd party. The Wii U is getting only 1st party, and seeing how companies have been reacting to the Wii U publicly... I don't see them jumping ship like they did with the 3DS.
  • TrAnMu - July 8, 2013 1:27 p.m.

    Man. I love Nintendo. lol

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