Analysis: Nintendo is running its new Switch console business by an old set of rules

The new switch OLED. (Nintendo picture)

What’s not in the new Nintendo Switch model is just as interesting as what it is, and it tells you a lot about Nintendo’s business strategy and how people use the system.

Nintendo announced on Tuesday that alongside the recently announced Metroid Dread, a new version of its console, the Switch OLED, will be released on October 8th.

The existence of a new model was leaked months ago and consumer speculation has been rampant ever since. The Switch is currently the best-selling game console in the world and has been for over two years, but it’s not without its flaws.

It is a system with low power consumption, for example with a fraction of the horsepower of the PlayStation 5 or the Xbox Series X. Many consumers and analysts have openly fantasized about the possibility of a “Switch Pro”, an updated edition like Microsoft’s Xbox One X. that would bring the Switch’s graphics closer to console competitors.

More importantly, Nintendo has inexplicably been silent on the subject of Joy-Con drift. There’s a defect with the Switch’s multipurpose pack-in controllers that inexplicably makes them wear out quickly, especially if you’re used to high-impact games like Super Smash Bros. Ultimate.

Nintendo said in a statement to GeekWire that the configuration and functionality of the Joy-Con controller had not changed with the OLED model.

A hardware update would have been the perfect opportunity for Nintendo to address these issues.

Instead, the improvements in the Switch OLED are comparatively subtle.

It’s a significantly better piece of technology than the launch version, the revamped 2019 model, or the lite editions of the Switch, with a number of features that give users a significantly better “quality of life”, but it’s still the same old switches under the hood.

A box mock-up of the packaging for the Switch OLED. (Nintendo picture)

These features include a slightly larger, brighter organic light emitting diode (OLED) screen for sharper graphics in portable mode; more than double the built-in internal memory of the previous version; an adjustable stand built into the back of the device; and an integrated Ethernet port for wired online gaming.

The last feature is more important than it looks. Many multiplayer video games are very lag-sensitive, especially the Super Smash Bros. Ultimate mentioned above, so it’s often frustrating to play them over a wireless connection.

The current switch model only offers instant WiFi unless players invest in a $ 30 USB LAN adapter. The move to add a built-in Ethernet port is one of the more online-friendly decisions Nintendo has made lately, especially for the smash scene.

But even here it is only a bonus for the quality of life. The OLED edition of the Switch is a solid package for people who haven’t bought into the system or just own a Switch Lite. But the upgrade is hardly worthwhile for existing Switch owners.

To be fair to Nintendo, if there had ever been a Switch Pro on the table at all, this would have been a bad year for it. The ongoing chip shortage is still affecting electronics manufacturing around the world, until it is likely that even the new OLED screen for the switch will be affected. Producing a new switch with higher performance in the current climate was probably a pipe dream.

So why bother with a new version of the switch at all?

For one, most of the OLED edition bonuses are specifically there to use the hardware’s portable mode. It’s easier to position, has room for more games, has better sound, and has a slightly larger, better-looking screen. That suggests that the main audience for the Switch is treating Nintendo as a portable system from Nintendo’s point of view.

More importantly, releasing a new Switch now is one of Nintendo’s oldest tricks at this point in the system’s life. All of its older handheld systems, such as the Game Boy, DS, and 3DS, went through multiple hardware revisions throughout their lifecycle.

Nintendo’s portable systems are known to go through multiple versions of their hardware throughout their lifespan. Left, a 2004 Nintendo DS Launch Edition; right, a 2006 Nintendo DS Lite. (Thomas Wilde photo)

Sometimes it has changed the hardware dramatically, such as switching between the original Game Boy Advance and the backlit Game Boy Advance SP with a clamshell design. In other cases, the existing unit was simply slimmed down, for example when switching from the clunky Nintendo DS to the slimmer DS Lite.

It often seemed ridiculous to Nintendo fans, but from a business perspective, there is method to the madness here, as Mat Piscatella of the NPD group explains:

Earlier, Nintendo portable revisions would stabilize the demand curve and solidify ASPs. Their aim was to maintain sales performance and to prevent the pull of price drops and obsolete inventories. The Switch OLED is straight out of this successful playbook.

– Mat Piscatella (@MatPiscatella) July 6, 2021

Existing Switch owners may be disappointed here for good reason, but the Switch OLED is not aimed at them. A handful of the die-hard may take the opportunity to switch to the next model, but the OLED is aimed solely at new buyers and continues to justify the switch’s current price.

However, it’s interesting to see how Nintendo is pursuing its design of its portable systems for the Switch, as opposed to its previous generations of console hardware. While there were new models of the NES and SNES, as well as the Jumper Pak add-on for the Nintendo 64, Nintendo tended to approach its consoles in a more traditional way. What you got in a Nintendo console the day it was released was more or less what you would get if you bought one the day before it was discontinued.

However, with its handheld systems, Nintendo has freely used small hardware changes and cosmetic changes in an attempt to attract new audiences to each system. By adopting a similar practice with the Switch, this suggests that Nintendo is pursuing a similar strategy with all of its old handhelds. These incremental improvements and new colors aren’t there to milk the existing audience; Nintendo is trying to win new buyers here.

This also seems to suggest that the Switch’s portability is, at least from Nintendo’s perspective, an important factor in its success, if not the main reason, and is likely to be a development priority in the future as well.

Right now, though, Nintendo isn’t trying to fix what isn’t really broken with the Switch OLED. While the switch has its problems and these are not really addressed by the OLED, the new version is clearly the best switch so far. On paper, it’s an easy pickup for new fans, fence sitters, or people looking to travel again, especially when the 2021 holiday season kicks off. The Switch OLED is definitely not what the enthusiasts have been looking for, but it is the latest application of a successful strategy that Nintendo has been using for nearly 30 years.

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