Pokemon Go is one of the biggest mobile games ever, but don't mistake it for the solution to Nintendo's problems. If anything, it's a symptom.
The mobile app, which encourages players to go outside and wander around catching and collecting virtual monsters, topped the App Store's "Top Grossing" chart faster than any game in history. At one point, it had more daily active users than Candy Crush Saga, making it the nation's most widely played mobile game ever.
Nintendo once owned (and practically created) the portable gaming market with the Game Boy and Nintendo DS. But interest in its products declined steadily with the rise of smartphones and mobile gaming. So too did its fortunes. Pokemon Go reversed that trend, if only briefly. Nintendo's stock price more than doubled to over 32,000 yen (about $300) after the game's release on July 6, a figure not seen since the wildly successful Wii console. It even surpassed the market cap of Sony. But its stock price tumbled almost as quickly, falling 13 percent on Wednesday.
You can attribute the fluctuations to irrational exuberance on the part of investors, as Nintendo doesn't publish Pokemon Go. It co-owns the rights to the franchise, and holds stakes in Go publishers Niantic and The Pokemon Company, so it is surely making some money from Go. But nobody knows how much. More to the point, Nintendo didn't create the game, and so its existence doesn't suggest that Nintendo's management finally "gets it."
Instead, it speaks to the breadth of the gap between where Nintendo is and where its fans are.
I've long said that Nintendo's fans migrated to mobile between the unprecedented success of Wii in 2006 and the equally unprecedented failure of its successor Wii U in 2012. But I disagreed with the masses who said Nintendo needed to "go mobile," which for many people meant dumping versions of classic games like Super Mario Bros. and Pokemon Blue into the App Store. Such a move would provide a short-term injection of cash, but no real long-term benefit. And those old games just wouldn't be as fun on a device that wasn't built for them.
