Nintendo: Digital Downloads Shouldn't Cut Into Physical Sales With DSi

(PaidContent.org)  This story was written by Matt Kapko.

---

Nintendo isn't expecting digital downloads to take over the retail games business with the launch of its new DSi handheld, Nintendo Of America President Reggie Fils-Aime told VentureBeat in a wide-ranging interview, but it's a "nice added business model. ... We'll be able to see the sales growth and plan for it. But I guess similar to home consoles, the consumer will want an experience that's best delivered through physical goods, simply because of the memory size required." Nintendo hasn't disclosed the amount of flash memory that will be in the DSi model. Fils-Aime also discussed the recession, risks Nintendo takes on new technologies, competitors and venture capitalists.

The economy: Fils-Aime: "This is a challenging macro-economic problem. If you look at history, the video game market hasn't suffered terribly during recessions. It's because consumers view our products as strong values. A $50 piece of software that you can play forever is inexpensive compared to taking a family of four out to a movie. Having said that, if the market continues its turmoil, if unemployment increases, we could be in something worse than a recession. At that point, all bets are off. We are competitive with other entertainment choices. But we depend on consumers having discretionary dollars."

More after the jump...

Going after Apple?: "We always viewed ourselves as competing in a larger entertainment space. It's not just video games but music, movies, and TV. You, as a consumer, have 1,440 minutes in a day. You work, eat, sleep or go to school. All of the time that's left is what we compete for. That's always the way we looked at it."

VC: "I'm somewhat concerned that some believe that if you invest a lot of money in a piece of software, that alone will make it great. We've been clear that Brain Age, which has sold more than 22 million units through last March, was built with a very small team on a small budget. It's not about the dollars." He doesn't want to return to the Internet boom when "some companies took pride in how much cash they were burning through each week. It's not a great thing. I hope the dollars are following ideas."


By Matt Kapko