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TVTranscript
00:01In an era when games were dead...
00:04Kaboom!
00:09There was virtually no console market in the U.S.
00:12Nobody bought consoles, nobody bought video games.
00:16An unknown company takes a big gamble.
00:19Nintendo was not well-known.
00:21In fact, newscasters would mispronounce the word Nintendo.
00:25They just couldn't get it right.
00:27This is the story of the rebirth of the gaming industry.
00:30What we've done is to single-handedly recreate a dead industry.
00:37Suddenly Nintendo, a Japanese newcomer, comes in and has a new console and says,
00:42Hey everybody, let's play games again.
00:46The Nintendo Entertainment System completely revitalized what was a dead industry.
00:51It re-injected life.
00:53It made kids love video games again.
00:55This is the NES.
01:06While disco breathes its last breath,
01:09and Jimmy Carter loses the presidential elections to a Hollywood actor named Reagan,
01:14America is ending its love affair with gaming.
01:17In the early 1980s, the home video game business in the United States collapsed.
01:25There was virtually no console market in the U.S.
01:28It was all after the kind of the crash of Atari.
01:33So gamers took a step back and, you know, opened their doors and went outside and saw the sun and
01:38did some other things for a while.
01:40Nobody bought consoles, nobody bought video games.
01:44A small bubble.
01:45I think a lot of it was just because they got bored with the games.
01:49The games weren't a high enough quality to really have people want to continue to play.
01:53It was usually referred to as the Atari debacle.
01:56There was a tremendous buildup of inventory of Atari home video game systems and a complete collapse, which cost a
02:08lot of people jobs.
02:11But in Japan, gaming is alive and well, thanks in part to a company called Nintendo.
02:18Nintendo is 150 years old.
02:20It started out making these playing cards.
02:23Nintendo did a lot of things in the meantime.
02:25You know, they had love hotels.
02:30Without going into too much detail, love hotels are the hotels that do really well because rooms can get booked
02:36four or five times in a night.
02:39They got out of that, but they did a whole lot of other stuff too.
02:45We were also in the consumer business selling the small Nintendo game and watch.
02:51So actually, we were in the handheld business before the home video game business.
02:56Then they tried to break into the arcade business.
03:01Their first attempts weren't very successful.
03:04They had Sheriff, which was an okay game.
03:09They had a game called Radar Scope.
03:15It did quite well in Japan, but not in America.
03:17Nintendo's biggest success in Japan is the Famicom, a unique game console developed by Masayuki Uimura.
03:26It was based on a family computer, is what they originally launched it over there.
03:31And they just shortened it up to Famicom.
03:33The Famicom was introduced in 1983.
03:38The launch was very, very successful.
03:43The collapse of the home video game business was really a U.S. market thing.
03:48It was not something that had occurred in Japan.
03:51It was a little tiny 8-bit box, red and white.
03:56Actually, really funny looking.
03:58It was really small.
03:59It's only about this big.
04:00But the games on it were a lot of fun to play.
04:04The system was well received because of the increased graphics capability of the product, as well as some really great
04:15games.
04:17So it took off.
04:19And it was not only successful, it was extraordinarily successful.
04:23Nintendo makes a daring decision to bring the Famicom to America.
04:27And it's timing couldn't be worse.
04:45Nintendo is about to bring their popular Famicom video game console to U.S. shores.
04:47Nintendo is about to bring their popular Famicom video game console to U.S. shores.
04:59And the odds are stacked against them.
05:02The game industry was in turmoil.
05:04And into that terrible market, suddenly Nintendo, a Japanese newcomer, comes in and has a new console and says,
05:09Hey everybody, let's play games again.
05:11But first, the Famicom needs to become more American friendly.
05:16It just didn't fall into American taste.
05:19It looked very Fisher Price.
05:21And we also didn't want to launch just a game platform because everybody at retail was saying another game platform.
05:28And we did that.
05:29We just got done with that.
05:30Why would we want to do that again?
05:32So we had to come up with something a little bit more Americanized and something with more of a hook
05:37to it.
05:37Our designers here at Nintendo of America thought that it ought to have a little bit more high-tech look.
05:44Nintendo of America turns the Famicom into a new unit dubbed the Advanced Video System.
05:49It had a music keyboard and a keyboard and, you know, the console itself.
05:53And it was real flat and sleek and gray and black.
05:56The Advanced Video System was really skinny.
05:58I mean, it was only about this tall.
06:00And it was a top-loading cartridge design.
06:02So we went and showed that at the Consumer Electronics Show.
06:06And the reaction that we got from the retailers was very negative.
06:11Nobody wanted to, nobody wanted to touch it.
06:13No one was interested in it because it was a home video game system.
06:18And then we came back from that show and our president, Mr. Arkawa, called myself and my designer and said,
06:24you know, this is the shape of what they want to produce the NES in here.
06:30Can you make it look good? And you've got an hour to do it.
06:33And so we went back to the drafting board and we were all pissed off because we'd spent all this
06:38time on this other design.
06:39But we came up with that gray and, you know, the stripe across the top in about an hour and
06:45came back in and presented it to him.
06:46And poof, the next thing we knew, that was what it was.
06:49Yeah, well, we lost the keyboards, both of them.
06:52There was a little, there was a floppy drive.
06:54Then we lost that.
06:55It was just the two controllers and the box itself.
06:58The front-loading cartridge slot isn't the only feature that sets this system apart from others.
07:03There's this weird rectangular control pad, you know, with a little cross-shaped D-pad.
07:08I'm like, I don't understand what this was because I'm used to having joysticks in my games and with two
07:13little red buttons.
07:14And I thought, you know, it's weird, but it's comfortable. It works.
07:17The Japanese company then approaches Atari for a partnership.
07:21The deal that we proposed to Atari was that we would sell the product on an OEM basis to Atari
07:31and give Atari the opportunity to distribute it not only in the United States but throughout the world.
07:38We knew that Atari was synonymous with video games and that Nintendo was not even known by the average consumer.
07:45But Atari turns down the offer and Nintendo decides to go it alone.
07:50Well, in the early 80s, Mr. Yamauchi was president of Nintendo Company Limited, the worldwide leader of Nintendo.
07:59He gave Nintendo of America the opportunity to see if we could launch the home video game system.
08:09We thought that we would test market the product in a small market area.
08:16And we explained that to him at a meeting sometime in early 1985.
08:22And he threw up his hands and said, no, the test market will be New York City.
08:28If you can succeed in New York City, you'll succeed anywhere.
08:31And if you fail, then you fail and that's it.
08:34The outlook for the Nintendo Entertainment System, or NES, is bleak.
08:39We decided that we would have a focus group and we would show the NES and the reaction of these
08:46kids was absolutely negative.
08:49It was astounding.
08:50The results of the test, the experts said, the best thing you can do is not introduce this product.
08:57It's not going to be well received. It's not going to be accepted.
09:00But Nintendo is undeterred.
09:03After making a few additions to the NES to set it apart from traditional gaming consoles, the Japanese company prepares
09:10to roll the dice.
09:11So in early 1985, the engineers at Nintendo Company Limited came up with Rob the Robot, which was made part
09:22of the Nintendo Entertainment System.
09:24So when we went to the retailers, we were saying, no, this isn't a home video game like Atari.
09:31This has Rob the Robot.
09:34And then we positioned it as an entertainment system.
09:37You also had a zapper, and those things combined with it kind of put it over the top and made
09:42it look like it's just not a game console.
09:45To get retailers to carry this system, Nintendo offers a win-win scenario.
09:49Let us put it in. Let us put some displays in that we will bring to your retail outlets, and
09:56you don't have to pay us until the end of the year.
09:59Not only that, but Nintendo would buy back any unsolved NES units.
10:03On October 18, 1985, Nintendo takes the plunge and releases the NES in select stores throughout New York City.
10:11Now the fate of this little gray box is in the hands of the Big Apple.
10:21Nintendo takes what many see to be a suicide dive into the video game console market with the Nintendo Entertainment
10:27System in 1985.
10:29They ship 50,000 units to select stores throughout New York City.
10:34So it was an uphill fight to enter the market with the NES in 1985.
10:40Nintendo was not well known.
10:42In fact, in my case, I remember listening to newscasters or to meeting people who would mispronounce the word Nintendo.
10:51They just couldn't get it right.
10:53But the system's unique appearance and strong lineup of games catches the public eye.
10:57When I first saw the NES, I thought, like, wow, that's so futuristic looking.
11:04It comes with a robot.
11:07And it's got this lid that opens. It's like from the future. It's amazing.
11:13Coming off being a fan of Atari 800 or ColecoVision and television, you know, the Atari 2600,
11:19the NES was pretty spectacular as far as what it could do.
11:21And a home version of Super Mario Brothers by Shigeru Miyamoto, the creator of Donkey Kong,
11:27makes the NES a must-buy for gamers.
11:33Miyamoto is one of those rare people who brought something new to gaming.
11:40They're these shining figures, these shining stars of gaming who introduce a new gameplay concept.
11:46So I'm looking for the $2 to $5 ColecoVision games, and all of a sudden I see Super Mario Brothers,
11:52which I had just become addicted to in the arcade.
11:54And I was like, Super Mario Brothers? Oh, wow!
11:58So I go around the corner to the other aisle, and there's the NES, and it's $80 with Super Mario
12:03Brothers.
12:04It's like, tick, okay, sold.
12:07Yeah, Super Mario Brothers was, you know, it remains one of the best games ever made.
12:14It shows just how far ahead Nintendo was from everybody else.
12:23For Mario, I mean, Mario was, of course, the first game to become a really huge hit all around the
12:29world,
12:29and generate lots and lots of fans.
12:32And so that, of course, you know, Mario will always be close to me.
12:37We didn't sell all 50,000, but it was enough of a success that Toys R Us and other retailers
12:46said,
12:47why don't you expand to a few other markets in 1986?
12:52But in early 1986, we made the decision that, based upon the success of the NES in New York City,
13:01that we would expand and go nationwide.
13:07By the end of 1986, the thing just took off. Amazing.
13:12And by Christmas of, uh, 8078, there were millions of units sold worldwide.
13:16There were already a few games that had broken a million units.
13:19It was pretty obvious that the game industry was back, you know, alive and well.
13:22The NES succeeded because they had kick-ass games.
13:27There was Metroid.
13:31Obviously, later, there was The Legend of Zelda.
13:37By 1987, 5.4 million NES units are sold.
13:42Nintendo's lineup is also boosted by a number of third-party games.
13:51We went out to a number of software companies, both in the United States and in Japan.
13:59And we were successful in bringing four or five on board, uh, Data East, Capcom, Bandai.
14:13To make sure the mistakes made by the game industry in the past aren't repeated,
14:20Nintendo devises a special system for developers who wish to make games for the NES.
14:25A number of us studied the Atari debacle very closely.
14:30And one of the reasons they had not succeeded was they had not been able to maintain quality control
14:36or with the software that was played on the hardware.
14:39But we wanted to make sure that if other people introduced games to the NES,
14:44they would introduce it under a licensing system that Nintendo would control
14:49and that Nintendo would control the quality.
14:52Third-party games that get approved for the NES are given the official Nintendo stamp of approval.
14:58But this same system will lead to some big legal battles.
15:07When 1988 rolls around, Nintendo's NES has an established base of 9.4 million units throughout the United States.
15:15The gray and black Japanese console is king of the hill.
15:19But that doesn't mean there isn't any competition.
15:22The first legitimate competition was Sega.
15:27The console wars started between Sega and Nintendo with the Sega Master System and the Nintendo Entertainment System.
15:33The thing was, brand loyalty ran so deep, for me at least as a child,
15:38that when I actually went to the department store and played a Sega Master System,
15:41I felt like I was cheating on my spouse.
15:43It was like I felt dirty and icky.
15:45So I ran home to my Nintendo and went back and played that instead.
15:48The Sega Master System would go on to sell only 2 million units in its lifetime
15:53and capture just 11% of the gaming market.
15:56The biggest problems for Nintendo come from legal battles rather than competition.
16:04One of the most notable conflicts Nintendo faces is with Tengen.
16:09Well, you had to license your games from Nintendo, you had to pay Nintendo a fee to manufacture it,
16:15you had to let Nintendo manufacture the cartridges for it.
16:19Where Tengen, which was an offshoot of Atari, was making unlicensed games for the NES.
16:25They concluded that they could go around the licensing system that we had in place
16:31and manufacture their own games for play on the Nintendo Entertainment System without the necessity of a license.
16:40And we got into litigation with them, but we were successful.
16:45Those lawsuits were all decided in Nintendo's favor.
16:49And I think that was really the first and last time that any company really made an attempt
16:56to get around the copyrights and patents that surrounded the Nintendo Entertainment System
17:02or the licensing system that was in place.
17:08Some game companies complained that Nintendo's control over third-party developers is too strict.
17:13But by 1990, Nintendo controls 80% of the gaming market.
17:18And if publishers wanted in, they had to play by Nintendo's rules.
17:22Yeah, well Nintendo had pretty, I would maybe call them aggressive business practices
17:28and they would really restrict publishers to only bringing out like a couple games a year.
17:32Uh, getting games approved for play on the Nintendo System was somewhat an arduous task at times.
17:38Nintendo in the early days would allocate specific products that you were going to do.
17:44They would allocate specific times that you could release them.
17:47They had tremendous testing checklists that we had to go through.
17:52And they would test the game and be pretty nitpicky about some of the things that were in it.
17:56Nintendo's strict policies lead to an investigation by the FTC and the matter is eventually settled out of court.
18:03Later, the game company sues Comerica over its Game Genie cheating device.
18:08And this time, Nintendo loses.
18:11The Game Genie was like your way of being the hacker.
18:15I can get in there and I can give myself infinite lives and I can warp all the way to
18:19the end.
18:20Nintendo didn't like it obviously because you could rent a game and beat it.
18:28By 1991, games like Super Mario Bros. 3 and Shadowgate pushed the NES to its peak, giving Nintendo 90%
18:37of the US video game market.
18:39From the official Nintendo Power Magazine to Nintendo accessories, toys and even cereal, the Nintendo invasion is complete.
18:48Growing up for me, Nintendo was the brand that meant everything to me.
18:52My nickname in elementary school was Nintendo Boy.
18:55I ate Nintendo cereal.
18:57I was, like, so obsessed with Nintendo Power Magazine.
19:00It's a miracle I didn't get beat up more often.
19:02There was this monthly magazine that was giving you tricks, that was giving you previews of the other games coming
19:08out.
19:08And you felt like, you know what, I'm a gamer now.
19:11I had, like, video game t-shirts and, like, I got a patch that said, I saved the princess.
19:15And I even had my power glove, which I kind of, like, rock.
19:18Like, I was, like, looking cool with it, you know, playing Mike Tyson's Punch-Out.
19:21But eventually, the NES has to make way for newer, more powerful systems.
19:25The NES eventually had to evolve into something more powerful.
19:29Sega came in with its Genesis, which is a 16-bit machine.
19:31All of a sudden, we're seeing more colors, livelier, more realistic animation, and a lot of different kind of games
19:38that you weren't able to play on the NES before.
19:43Well, certainly, technology was moving on, finally.
19:46And we were on to the Super NES and 16-bit processors and just another jump in graphics capabilities and
19:55gameplay.
20:04I think, you know, that was inevitable.
20:08That was eventually going to happen.
20:10Kind of started the cycle, I guess you see today, of technology and new systems coming out every few years.
20:17As time goes by, game consoles steadily grow more and more powerful.
20:21But no matter what the future brings, the impact of the NES on the world of gaming will never be
20:27forgotten.
20:27You look back and the NES was the system we all grew up with.
20:31It had all the great games, it established all these huge franchises.
20:38The NES brought gaming back and it made it very, very popular.
20:45And it actually transcended continents.
20:47It was popular in Japan, it was popular in the US and Europe.
20:50Something that hadn't really happened with the Atari console before it.
20:56The NES basically shattered the whole idea that gaming was a fad that's never to come back.
21:05I think the video game industry would not be where it is today without the Nintendo Entertainment System.
21:15If you think about it today, the NES is like, for a lot of people, you know, a whole generation
21:19of gamers, the NES is where it all started.
21:25There's no question in my mind that if we had not successfully launched the NES, that the home video game
21:32business would not exist as we know it.
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