AT&T now says it will continue its already-announced fiber optic network expansion to 100 cities, moving away from comments by AT&T CEO Randall Stephenson after President Obama voiced support for net neutrality last month.
The move brought a strong response from critics who say the carrier’s fiber optic plans are mostly bogus and were designed as a competitive play against the ongoing Google Fiber rollout. The purported delay in AT&T’s investments was quickly seen as an empty threat.
In a letter to the Federal Communications Commission (FCC) sent Nov. 25, AT&T said won’t limit future fiber-to-the-premises deployments to 2 million homes as part of its $49 billion deal to acquire DirecTV. That contrasts with what Stephenson said Nov. 12.
“To the contrary, AT&T still plans to complete the major initiative we announced in April to expand our ultrafast GigaPower fiber network in 25 major metropolitan areas nationwide.” Robert Quinn, AT&T senior vice president for regulatory matters, said in the letter.
In his Nov. 12 appearance at a Wells Fargo investors conference, Stephenson had said AT&T would stop fiber rollouts beyond the 2 million for the DirecTV deal: adding: “We can’t go out and just invest that kind of money deploying fiber to 100 cities other than these 2 million not knowing under what rules that investment will be governed.” The 100 cities are included in the 25 metro areas AT&T cited in its letter to the FCC. Stephenson later said to Fox Business Network that it might be two to three years before AT&T starts investing again in fiber optic network rollouts to 100 cities.
Since it won’t limit its fiber deployment to 2 million homes, AT&T also told the FCC that it didn’t need to provide documents surrounding any decision to delay. AT&T also redacted from public view any details on its fiber rollout in the letter.
An Israeli firm claims it has developed technology that can charge a mobile phone in a few seconds and an electric car in minutes, advances that could transform two of the world’s most dynamic consumer industries.
Using nano-technology to synthesize artificial molecules, Tel Aviv-based StoreDot says it has developed a battery that can store a much higher charge more quickly, in effect acting like a super-dense sponge to soak up power and retain it.
While the prototype is currently far too bulky for a mobile phone, the company believes it will be ready by 2016 to market a slim battery that can absorb and deliver a day’s power for a smartphone in just 30 seconds.
“These are new materials, they have never been developed before,” said Doron Myersdorf, the founder and chief executive of StoreDot, whose investors include Russian billionaire and Chelsea soccer club owner Roman Abramovich.
The innovation is based around the creation of “nanodots”, which StoreDot describes as bio-organic peptide molecules. Nanodots alter the way a battery behaves to allow the rapid absorption and, critically, the retention of power.
The company has raised $48 million from two rounds of funding, including backing from a leading mobile phone maker. Myersdorf declined to name the company, but said it was Asian.
With the number of smartphone users forecast to reach 1.75 billion this year, StoreDot sees a big market, and some experts think that — with more work — it could be on to a winner.
“We live in a power hungry world … people are constantly chasing a power outlet. StoreDot has the potential to solve this real big problem,” said Zack Weisfeld, who has worked with and evaluated ventures in the mobile phone sector globally.
“They still have some way to go, to deal with size of battery and power cycle rounds, but if solvable, it’s a very big breakthrough,” he told Reuters. A power cycle round refers to the number of times a battery can be re-charged in its lifetime.
Myersdorf said a fast-charge phone would cost $100-$150 more than current models and would ultimately be able to handle 1,500 recharge/discharge cycles, giving it about three years of life.
The action was taken in reference to events dating back to 2007, which saw employees of SAP’s TomorrowNow unit accused of illegally downloading Oracle software.
German company TomorrowNow was bought by SAP as a means to undercut Oracle’s internal tech support rates, with the ambition of getting customers to migrate to SAP solutions, reports Reuters.
In 2006, TomorrowNow started the process of undermining its parent’s position, offering cut-price support to users of the Siebel database and CRM.
Oracle was originally awarded $1.3bn back in 2010, but this was adjusted downwards on multiple appeals.
SAP acknowledged that its employees had been in the wrong, but disputed the damages awarded. SAP offered a $306m payment in 2012, but did so more in hope than expectation given its admissions.
Earlier in the year, a federal judge gave Oracle the option to settle for $356.7m or force a retrial, and the company has now decided on the former with a further $2.5m in interest.
“We are thrilled about this landmark recovery and extremely gratified that our efforts to protect innovation and our shareholders’ interests are duly rewarded,” said Oracle’s general counsel Dorian Daley.
“This sends a strong message to those who would prefer to cheat than compete fairly and legally.”
SAP agreed: “We are also pleased that, overall, the courts hearing this case ultimately accepted SAP’s arguments to limit Oracle’s excessive damages claims and that Oracle has finally chosen to end this matter.”
SAP announced a partnership with IBM last month to bring its HANA service to enterprise cloud users.
“We can’t go out and invest that kind of money deploying fiber to 100 cities not knowing under what rules those investments will be governed,” AT&T CEO Randall Stephenson told investors on a conference call earlier this week.
“We think it is prudent to just pause and make sure we have line of sight and understanding as to what those rules will look like,” Stephenson added.
His comments came just two days after President Obama urged federal regulators to invoke rules banning Internet Service Providers such as AT&T from requiring payments from content providers like Netflix to get higher network priority.
AT&T has promoted its U-verse GigaPower service in recent months to bring 1Gbps service to cities and has heard from 100 different cities who are candidates for the rollouts. In an online promotional video, AT&T notes that it already has 16.5 million broadband connections and has laid more than 1 million miles of fiber optic cable.
Google, meanwhile, has connected several U.S. cities with its Google Fiber 1 Gbps connections and has plans to serve dozens more cities.
The delay in AT&T’s fiber optic investment could be vast, given AT&T’s estimate in 2013 that it would spend $14 billion over three years for wired and wireless broadband infrastructure in what it called Project Velocity.
AT&T didn’t respond when asked how long the delay in its fiber rollouts could be. But the Federal Communications Commission (FCC) on Monday said it won’t create new rules in its open Internet deliberations until 2015.
The FCC’s delay came shortly after President Obama on Monday called for far-reaching rules to affect cable and phone companies, including AT&T and other wireless carriers, that operate as ISPs. Obama made it clear he opposes any attempt by ISPs to prioritize Internet traffic in exchange for a higher payment by a content provider.
AT&T is part of a large group of carriers, including the CTIA industry group, opposed to Obama’s approach. Members have argued that regulating ISPs like traditional phone companies under Title II of the Telecommunications Act, as Obama prefers, won’t hold up in court.
Groups that favor expanding Internet service to underserved populations in inner cities and rural U.S. areas have largely welcomed fiber optic expansion by both Google and AT&T. The impact of AT&T’s delay on their efforts isn’t clear.
That accounts for 16 percent of all transactions at its coffee shops and, the company says, meant it transacted 90 percent of all of mobile payments in the entire U.S. in 2013.
The company’s slice of the national mobile payments market is sure to dip in the years ahead as other retailers start catching up to Starbucks, in part thanks to the recent launch of Apple Pay, but Starbucks says it sees no slow down in consumer adoption of its mobile payments technology.
Starbucks has integrated payments into its its own app, which allows customers to keep a prepaid Starbucks card on their phone, enabled with automatic refills when it gets low on cash, and keep a list of favorite drinks to make ordering easier.
Starbucks has apps for both Apple iOS and Android devices. On iOS, the prepaid Starbucks card is integrated with the phone’s Passbook digital wallet app.
“What you’re going to see in the years ahead will be a rapid acceleration in mobile device purchases and a continued significant migration away from bricks-and-mortar commerce,” said Howard Schultz, CEO of Starbucks, in a conference call with investors.
Schultz said mobile users represented “a huge prize” for retailers and financial services companies and that’s why there is so much interest in the sector.
“That’s why every tech and financial service company in the world is today chasing the mobile payment opportunity,” he said. But he said that while Starbucks doesn’t have the hardware and software expertise of competitors, it has managed to do something that its competitors, so far, haven’t: change consumer behavior.
“We’ve accomplished this by integrating the convenience of mobile payment to a compelling and enjoyable program that gives our customers rewards,” he said.
The program, which will be marketed as Schwab Intelligent Portfolios to retail investors and independent investment advisers, will create portfolios of exchange-traded funds managed by Schwab and other providers.
In offering the service without management, transaction or account service fees, Schwab intends to be “disruptive” to competitors that have rapidly been introducing “rob o-adviser” platforms that charge fees of about 0.25 percent of money invested, Schwab officials said in a conference call with analysts and investors.
Reuters reported Schwab’s plan to introduce a free rob o-program on Oct. 3.
Schwab said it can make money through fees from managing and servicing underlying ETFs and from investing client cash in the portfolios. While the portfolios could draw investors who use conventional Schwab accounts or hire advisers who trade through Schwab, the company is not afraid of “cannibalizing” its own revenue, executives said.
The service will appeal primarily to Schwab’s traditional self-directed investors who do not want to use its fee-based advice programs, Chief Executive Walt Bettinger said.
He would not name specific competitors Schwab expects to undermine, but said they range from independent firms that offer only automated programs, to “wire houses,” a reference to large full-service firms such as Merrill Lynch, Morgan Stanley and UBS AG’s U.S. brokerage unit.
“This has the potential to create impact across the entire market,” Bettinger said.
Amazon is persisting in buying content to round out its service, with designs to take on Netflix Inc and other online digital media services. But that increasing spending has helped keep the company in the red, inviting criticism from investors.
Audible, the audiobooks service it bought in 2008 for $300 million, is picking up the 10-person company for an undisclosed sum. Audible founder and Chief Executive Donald Katz said in a statement on Monday the company had been attracted by Rooftop’s content as well as its pool of comic talent.
Rooftop records comedians at clubs across the country and licenses the digital rights to thousands of hours of comedy, which is broadcast either live or later on demand. The company’s media partners include Apple Inc and Yahoo, and it also works with streaming services such as Sirius XM, Spotify and Pandora.
Its content now becomes part of Audible, itself a fast-growing seller of online audiobooks, and vastly increases Rooftop’s audience, said Rooftop Chief Executive Officer Will Rogers.
Amazon is expected to continue acquiring digital content at a rapid clip. In past years, it began investing heavily to branch out from its online retail roots, delving into Hollywood-style content production as well as developing a line of tablets, smartphones and set-top boxes to accelerate the sale of digital content.
Yahoo Inc is expected today to reveal cost-cutting efforts and give details of how it is evaluating possible acquisitions as it faces mounting pressure from an activist investor, the Wall Street Journal reported, citing a person who was briefed on the plan.
Yahoo is considering purchasing one or more large technology startups with some of the $5.8 billion it made from the initial public offering of Alibaba Group Holding Ltd, the newspaper said.
Representatives at Yahoo did not immediately respond to an email seeking comment outside regular U.S. business hours.
Last month, activist investor Starboard Value LP publicly pressured Yahoo to cut what it referred to as a “bloated” cost structure.
Starboard, the second activist investor to target Yahoo in the last three years, also said the company should quickly “monetize” its Asian assets, which exceed the enterprise value of its actual business.
Earlier this month, Yahoo said it is reducing the size of its operations in Bangalore, India, the Internet company’s largest engineering facility outside its California headquarters. It is also closing its office in Jordan.
Yahoo is “streamlining” its operations in foreign offices, which might involve a combination of closing offices, cutting jobs and moving workers to its Sunnyvale, California, headquarters, the Journal said.
The official cessation of discussions to merge two of the tech industry’s largest enterprise-oriented firms may come as a disappointment to activist investors Elliott Management, which has pushed hard for storage products maker EMC to pursue merger or spinoff opportunities.
Pressure is building on EMC as rival technology companies, such as eBay Inc and Symantec, begin spinning off operations in an attempt to unlock shareholder value, become more agile, and capitalize on faster-growing businesses.
It is unclear when talks ended following months-long discussions, the people said on condition of anonymity because the talks were private.
Executives from the two companies were still trying to hammer out a deal as recently as last week, but talks bogged down on price and are now dead, the people said.
HP has temporarily suspended its stock buyback program ahead of its Nov. 25 earnings because the company said it is in possession of material non-public information. When pressed by stock analysts, Chief Financial Officer Cathie Lesjak noted on a conference call that the non-public information pertains to a possible acquisition.
HP and EMC declined to comment on Tuesday.
It is also unclear what specifically was discussed. A straight-up merger of the two companies would have created one of the industry’s largest providers of data storage, and created a computing giant with deep penetration in the business of providing computing hardware and services to corporations.
Security software maker Symantec Corp is in advanced negotiations to split its business into two entities – one that sells security programs and another that does data storage, Bloomberg reported, citing people with knowledge of the matter.
An announcement may be a few weeks away, according to Bloomberg.
Symantec declined to comment on the report.
Reuters reported in April that Symantec, the biggest U.S. security software maker, was in the process of hiring banks to help advise on strategy and defend against possible activist investors.
Private equity firms were also looking at the possibility of breaking up Symantec into smaller pieces, some of which may also be attractive to industry peers, sources told Reuters at that time.
A breakup may position Symantec’s separated businesses as acquisition targets, given that large companies including EMC Corp and Hewlett-Packard Co are interested in the stand-alone security business or in an independent storage business, Bloomberg reported.
Earlier this year, the company, known for its Norton antivirus software, abruptly fired its CEO as it struggles to revive growth amid eroding PC sales.
Symantec, which also offers data storage products, has seen revenue growth turn negative in recent quarters, unlike the rest of the security software market, which is growing at least 10 percent to 15 percent annually.
The slowdown is partly due to eroding PC sales, affecting demand for its software, which often comes bundled with new computers. It has failed to gain a strong footing in the market for mobile security.
If it goes ahead with the breakup, Symantec would join technology companies that are spinning off operations in an attempt to become more agile and capitalize on faster-growing businesses.
Three of the four largest U.S. mobile operators and satellite provider Dish Network Corp plan to bid in the Federal Communications Commission’s November auction of airwaves, according to initial applications released on Wednesday.
As expected, the largest U.S. wireless carrier Verizon Communications Inc, No. 2 AT&T Inc, No. 4 T-Mobile US Inc and Dish appeared to be the largest companies to indicate an interest in bidding in the upcoming auction of frequencies known as AWS-3.
Applications from Northstar Wireless LLC and SNR Wireless LicenseCo LLC reported they had entered bidding agreements with Dish, which had indirect ownership interest in both companies.
Northstar’s disclosures showed direct and indirect ownership interest by Alaska Native corporation Doyon Ltd and indirect ownership interest by financial firm Catalyst Investors. Asset manager BlackRock Inc had membership shares in SNR, according to the documents.
T-Mobile and AT&T did not appear to plan joint bids with other companies, and T-Mobile’s Kathleen Ham, vice president of federal regulatory affairs, said the carrier had no such agreements with any company.
A Verizon spokesman did not respond to inquiries about potential joint bidding and Dish representatives declined comment beyond confirming the submission of its application, citing FCC’s anti-collusion rules.
A total of 80 entities submitted initial applications. Interested parties, which may or may not actually bid for wireless licenses in the auction, included smaller U.S. companies such as Bluegrass Wireless LLC, Guam-based wireless company Docomo Pacific Inc and individual spectrum investors.
Scheduled to begin on Nov. 13, the auction is expected to raise at least $10 billion and will include airwaves previously occupied by multiple federal users, including the Department of Homeland Security.
Dish applied to bid in the auction as American AWS-3 Wireless I LLC and disclosed joint bidding arrangements with SNR and Northstar, which in turn had to disclose ownership and other information.
SNR listed former FCC Wireless Bureau Chief John Muleta, now CEO of consulting firm Atelum LLC, as a contact. Muleta, reached late on Wednesday, declined comment, citing FCC’s restrictions.
Northstar’s disclosures listed Allen Todd, assistant secretary at Doyon, a Fairbanks-based Alaska Native Regional Corporation with numerous affiliates in various fields including oil and gas land drilling. Todd could not be reached for comment on Wednesday.
SNR’s and Northstar’s, as well as AT&T’s, initial application appeared to be incomplete, which can be caused by small bureaucratic omissions. Of the 80 applications, 47 were deemed incomplete and have to be properly finished by Oct. 15 to allow the companies to participate.
All initial applications have to put down an upfront payment by Oct. 15 to confirm participation.
EBay Inc’s agreement to spin off PayPal next year will give the unit more flexibility to strike deals in the constantly evolving payments arena as growth at the company’s traditional e-commerce business slows.
The surprise move is a huge about-face for eBay’s leadership, including Chief Executive Officer John Donahoe, who resisted shareholder activist Carl Icahn’s calls for a split earlier this year and led a months-long campaign to convince investors that eBay should remain intact.
Icahn, eBay’s sixth-largest shareholder, eventually backed off in April. But eBay directors and executives shifted their stance on the split in June after a six-month internal study of the payments landscape, Donahoe said in an interview.
“We felt like a couple things were changing,” Donahoe said. “Most notably, the pace of change in this competitive environment, and payments and commerce is accelerating and will continue to over the next three to five years.”
By splitting off PayPal, the fast-growing payments division and the new eBay would have “more focus, more flexibility, more agility, more ability to move quickly,” said Donahoe, who will step down as CEO after the spinoff in the second half of 2015.
Donahoe and Chief Financial Officer Bob Swan, who will also leave next year, plan to serve on the boards of one or both companies after the split. EBay will spin off PayPal as a publicly traded company in a transaction that will be tax-free to shareholders.
PayPal’s next CEO will be Dan Schulman, former head of American Express Co’s online and mobile payment business. The new eBay will be headed by Devin Wenig, president of eBay marketplaces and former head of the markets division at Thomson Reuters Corp.
By freeing itself from the slower-growing parts of eBay, PayPal can build partnerships with e-commerce rivals and seize market share from payment startups like Stripe, backed by several PayPal founders, and technology behemoths like Apple Inc, which unveiled its own mobile payments initiative earlier this month.
“There are those who have not embraced PayPal because they’re part of eBay,” said Richard Sichel, chief investment officer of The Philadelphia Trust Co, which manages $2 billion and owns eBay shares. “It’s more of a pure play then.”
The split highlights the slowing growth of the marketplace business, which may be less alluring for some investors on its own. PayPal was founded in the late 1990s, went public in 2002 and was acquired by eBay soon after for $1.5 billion.
The “transaction implies negative trends for the eBay marketplace business, which has been suffering from greater competitive headwinds recently,” RBC Capital analyst Mark Mahaney said in a research note.
Kuddle, a Norwegian photo-sharing app created for children, plans to roll out a child safe tablet with Microsoft on Dec 1, and expects to sign funding deals with several venture capital firms within weeks, its chief executive said on Monday.
The Oslo-based company said it was on track to reach its goal of one million users by year-end and plans to soon raise another $5 million of fresh funds on top of the nearly $6 million it has already raised.
“We are working with Microsoft on several child safe devices which will be sold on our online store,” Chief Executive Ole Vidar Hestaas said. “The first device will be an Ipad Mini sized tablet prized under $100 that will be ready ahead of the Kuddle Store launch.”
“This is a child friendly device and it is not possible to download games like GTA (Grand Theft Auto) or apps like Snapchat,” Hestaas said.
Kuddle, which bills itself as a rival to Instagram, lets parents monitor what their children publish and keeps access to content restricted, preventing strangers from seeing and sharing pictures. There are no hashtags or comments to prevent online bullying and “likes” are anonymous.
Hestaas said the company also is in talks with Samsung and Microsoft’s Nokia phones unit on similar cooperation, and that it was also working on deals with European telecoms operators Telenor and Vodafone for child safe Kuddle SIM cards to be sold separately or linked up to one of its devices.
The app, which has a target of 1 million users by the end of 2014, is now available in 7 languages. The most significant growth has recently come from Brazil and the US.
Hestaas said he expects to conclude funding deals with several major international venture capital funds within weeks.
The firm’s present investors include Norwegian golf ace Suzann Pettersen.
French budget-conscious telecom operator Iliad has set a mid-October deadline to decide whether to improve its bid for T-Mobile US or walk away as it faces resistance from seller Deutsche Telekom, several people familiar with the situation said.
Deutsche Telekom, which owns 66 percent of the fourth-largest U.S. carrier, has doubts that Iliad will be able to improve the U.S. business since the French startup has no track record in the country, a source close to the German company’s management said.
Under the deal structure proposed by Iliad, Deutsche Telekom would have to keep a stake in the combined company.
Iliad is currently in talks with several U.S. banks to help it finance a possible improved bid for T-Mobile US alongside existing lenders HSBC and BNP Paribas, the people familiar with the situation said, after a $33 per share offer for 56.6 percent of T-Mobile US was rejected by Deutsche Telekom.
Chief Financial Officer Thomas Reynaud said Iliad’s key leverage ratio would not surpass 4.5 times net debt to earnings before interest, tax, depreciation and amortization (EBITDA). He also said that Iliad would limit any capital increase to fund the T-Mobile bid to 2 billion euros ($2.57 billion).
Iliad is also seeking to team up with private equity funds including KKR to raise about $5-6.5 billion, the sources, who could not be named because the talks are private, said.
T-Mobile US, Iliad and KKR declined to comment. Deutsche Telekom could not be reached immediately for comment.
Iliad’s management team has now finished road shows to meet U.S. investors and is waiting to hear back from potential investors, the sources said.
Depending on how positive the feedback is from private equity investors, the French firm could be able to table an improved bid in the second week of October, two of the sources said.
Iliad could offer between $35 and $40 per share for a stake in T-Mobile of between 60 percent and 90 percent, depending on the appetite of private equity funds and lenders for the deal, two other sources said.
Nintendo’s Shigeru Miyamoto doesn’t want to make games for “passive” people; the attitude that games ought to be to be a roller-coaster ride, to entertain without challenge, is, to his mind, “pathetic”. That was the message from the legendary game designer in an E3 interview with Edge magazine, published in this month’s edition; it’s been presented by other news outlets as a sign of a Nintendo U-turn, moving away from the casual market it sought with the Wii and the DS in favour of re-engaging core gamers.
That’s exactly the sort of message that most of the games media wants to hear, of course. The media, after all, speaks exclusively to core gamers; casual players generally don’t bother with specialist media. “Nintendo has seen the error of its ways and realised that the only people worth making games for are you, my dear brethren!” is a crowd-pleaser of a message; but it’s also a pretty big leap to make from the comments Miyamoto actually made.
First, the context. Edge had just challenged Miyamoto over the fact that his prototype games at E3 were all somewhat difficult to play. They used the Wii U GamePad in new ways which it took a while to get accustomed to; the question implied in the text of Edge’s interview isn’t about casual games at all, but about the difficulty level of the prototypes. Miyamoto’s response does make clear a mental distinction between different types of game consumer and a preference for those who enjoy some challenge in their entertainment, but to extrapolate that into a U-turn in Nintendo’s development priorities is an overreach.
In fact, Miyamoto’s comments – equating passivity with “the sort of people who, for example, might want to watch a movie. They might want to go to Disneyland. Their attitude is ‘OK, I am the customer; you are supposed to entertain me’” – are punching in a number of directions at once. Certainly, he’s frustrated by people who play games without ever really engaging with them as a challenge; I doubt he’s a fan of free-to-play systems that allow you to pay money to bypass challenges. Equally, though, those comments are an attack on some approaches to AAA game design; barren technological wonders which serve as little more than on-rails galleries for artwork and pale narrative. Miyamoto isn’t saying “casuals have ruined the market”; far from it. He’s saying that there are consumers who demand spoon-fed entertainment at all points of the spectrum from core to casual, and that he doesn’t want to make games for any of them. (It’s also worth noting that he’s not really blowing his top over this; “pathetic” doesn’t carry the same kind of stinging indictment in Japanese that it does in translation.)
Later in the Edge interview, Miyamoto veers back to similar territory when he talks about the proliferation of mainstream game-capable platforms like iOS and Android devices. While adamant that Nintendo needs to continue to make hardware as well as software, he’s delighted that these new platforms exist, because they provide an “on-ramp” for consumers who haven’t engaged with games before. Nintendo previously saw itself holding a responsibility to try to open up new demographics for the games industry; now it seems that we’ve reached a tipping point, technologically and culturally, where that’s happening by itself.
Edge speculates that this means Miyamoto (and hence Nintendo) believes that the window has shut on making games for entry-level gamers. Titles like Brain Training, which opened up the DS to a huge audience of people who had rarely if ever played games before, may now be pointless; the consumers they ought to target are all playing games on their phones and tablets, so there isn’t an addressable market remaining there for dedicated hardware and more expensive (non-F2P) games. This is fair analysis, and indeed, it probably features in Nintendo’s thinking; let iOS serve as the entry level for new gamers and then hope that those who enjoy the experience will ultimately upgrade to the superior offerings available on a dedicated console.
At the same time, though, Nintendo itself has a conception of “casual” and “core” that probably isn’t shared by the majority of sites reporting Miyamoto’s comments. Miyamoto talks not about themes but about enjoyment of challenge as the distinction between the two groups. To him, a supposedly “adult” game full of blood and ripe language could be utterly casual if it spoon-feeds players with dull, linear gameplay. Meanwhile, a brightly coloured Mushroom Kingdom epic could qualify as “core” if it challenges players in the right way. Consequently, Nintendo’s family-friendly IP and the broad appeal of its themes is entirely compatible with a focus on “core games”, to Miyamoto’s mind. What he’s talking about changing is something at the root of design, not the thematic wallpaper of the company’s games; he wants to challenge people, not to force Nintendo’s artists to remove all the primary colours from their Photoshop palettes.
Viewed in this light, Miyamoto’s comments are an earnest and down-to-earth appraisal of Nintendo’s present situation; still recovering from the heady days of the Wii and figuring out how much of that flash-in-the-pan market is really sustainable, but knuckling down to the challenge of entertaining and delighting (and of course, selling to) those within the audience who really enjoyed games rather than latching onto the platform as a fad. Contrary to the more excitable reportage on his comments, Miyamoto is promising no major changes to Nintendo’s approach; rather, he’s re-committing himself and the company to the same course of action which delivered games like Mario Kart 8, a title firmly within the family-friendly Nintendo tradition and absolutely celebratory of challenge and good design.
“Core gamer” is a phrase that’s picked up a strong whiff of soi-disant elitism and exclusion over the past few years; the phrase “as a core gamer…” in a forum post or comment thread is this odd little corner of society’s equivalent of “I’m not a racist, but…”, indicating a post that’s probably going to brim with self-important awfulness. The bête noire of the core gamer is the “casual”, and just as any move by a game creator or publisher to cater to “casuals” is despised and derided, any prodigal son who declares their abandonment of the casual market and return to the core is greeted with an I-told-you-so roar of delight. This is a thin sliver of the market overall, of course, but a noisy one; as such, it’s worth reiterating that what Miyamoto absolutely did not say is that Nintendo is resetting its course to please these people. Nintendo, for many years to come, will still be a company defined by games that are broadly appealing, generally family-friendly and enormously accessible. Under Miyamoto’s watchful eye, they’ll also be challenging and engaging; but anyone taking his comments on “passivity” as near-confirmation that we’ll see Grand Theft Mario down the line is utterly misreading the situation.