Is Xbox Trying to Destabilize Nintendo?

There has been a lot of breaking news stories stemming from the accidental release of documents in the FTC v Microsoft case. An Xbox Series console refresh, the plans for the next Xbox console, upcoming and unannounced game releases, and the bombshell that Microsoft executives are eyeing Nintendo as a possible acquisition target. The Nintendo acquisition has rightfully been driving most of the conversation about the accidental leak, but most of the talk is settling on this being wishful thinking on Microsoft’s part.

However, it feels like one key detail is being overlooked in these e-mails. As Phil Spencer is laying out his thoughts on the possibility of acquiring Nintendo, he mentions his connection to a former Microsoft Board of Directors member. This individual is buying up more and more Nintendo stock, to the point that Phil Spencer believes that they will have a big enough voice to seriously impact any decisions Nintendo makes as a publicly traded company.

Image Courtesy of FTC v Microsoft.

This is important because Nintendo is in a very good position in the market, making plenty of money without taking on much risk. However, they might be pushed to take on more risk to appease larger stockholders. This can easily lead to Nintendo getting itself into a situation where they are in trouble, making it easier for Microsoft to swoop in and seem like a helpful party by taking over a struggling Nintendo. This is what Phil Spencer is most likely referring to as one of the “opportunities.”

If this were to happen and Microsoft managed to get this acquisition, it would be devastating for the gaming industry. Nintendo does things differently from either Sony or Microsoft, and appeal to a different set of gamers that add to our community. Seeing Nintendo get bought by Microsoft will most likely mean the end of a lot of the magic we see from Nintendo today.

Image Credit: The Verge.

It’s the magic that means we get oddball game series such as WarioWare, Everybody 1-2 Switch, and Pikmin along with the smash hits Super Mario Odyssey and Breath of the Wild. Under Microsoft these same studios will be tasked with continuing with the smash hits that just run on better hardware, and most likely on a regimented release schedule similar to Call of Duty. Ultimately, this will shrink the audience of gamers.

This magic is present because of the corporate culture currently in place at Nintendo. In a recent interview the producer and director for the upcoming Super Mario Bros. Wonder both spoke about getting the time and breathing room to fully explore all the ideas the development team was cooking up. This has been a big boon for the game as it has been getting a lot of positive press from people who have been able to play it.

This culture is undoubtedly why Nintendo is reported to have a new employee retention rate of 98.8%, which is an insane figure for any industry. Companies throughout the rest of Japan only enjoy a retention rate of 70%. It’s hard to imagine that this type of employee longevity alongside developers getting as much time as needed remains after an acquisition, where a company like Microsoft will be looking to maximize the return on its investment.

It has been concerning that a lot of pundits in the gaming industry have just brushed this news off as no big deal, and just Microsoft executives writing about dream scenarios. Because if you read it very carefully you can see that there are very specific moves being made in order to try and make that dream come true. Moves to try and destabilize Nintendo.