Nintendo Cracks Down On European Importers

Thanks to an anonymous reader for pointing to a Gamesindustry.biz article describing Nintendo's attempts to stop European retailers importing Gamecube/GBA games. According to the piece, "..cease and desist orders have been issued to a number of independent retailers by Nintendo this week, demanding that they stop selling imported Nintendo titles and supply details of their suppliers." With handheld titles such as Pokemon Ruby and Sapphire lacking regional lock-outs, and even US/Japanese Gamecube games being playable with the help of Freeloader, Nintendo are clearly worried about imported titles taking away from native European sales, but as Gamesindustry.biz points out, "..the move will prevent [consumers] from playing titles which Nintendo of Europe has failed to release in this territory, such as the highly acclaimed Animal Crossing."

Comments

Nintendo shmucks

[n1ywb]

Did anybody else here get their $20 check from Nintendo for price fixing the NES many years ago? Some things never change.

Why would Nintendo even care?

[AtariAmarok]

Why does Nintendo even care about this?

It seems to make as much sense as the region system, which prevents me from getting DVD's which are only available outside my region.

Re:Why would Nintendo even care?

[Babbster]

They care for a few reasons:

1) Mainstream retailers in Europe aren't going to do a lot of importing because it would damage the deals they get from Nintendo and others when buying high volumes of their games. Therefore, anyone who DOES sell import versions is damaging the market for the mainstream retailers because that means a lot of their customers will have no interest in the game when it's finally officially released.

2) Because Europe is still the "third string" when it comes to video game distribution, some third-party game publishers don't distribute their own games in Europe and let Nintendo or other big companies do it for them. That means that if Nintendo is publishing a game in Europe that, say, Koei published in Japan and NA, Nintendo gets a better profit margin with both the standard royalty and consideration for doing the publishing. If, however, someone imports the Koei NA version (to continue using that example - I don't know how Koei handles their European distribution) it cuts into the eventual profits of the publishing company when it's officially released.

3) Marketing. Interest in new releases is diluted by the fact that people have already played the imports. This is a particular problem in Europe sine more Europeans speak/read English than, for example, than Americans speak/read Japanese. This dilution of interest means that marketing dollars aren't going to help out a game that might not be that good because the word of mouth has already been spread by importers. Note that this reason is the primary factor in DVD region coding because most movies are stagger-released around the world to allow for regionalized marketing, and in extreme cases a movie could be in its first month of theatrical release in India while the DVD has been out for two weeks in the US.

All that being said, I think Nintendo is making a big mistake here. While I understand the goal of making their retailers happy (probably the main reason for the crackdown), they're running the risk of alienating more customers than they already have. Nintendo would do well to work harder on getting their big releases out in both NA and Europe at the same time. After all, nothing they do is going to make the grey market disappear. They'll just force the most visible importers to work more quietly or quit while others come in and take their place.

Re:Why would Nintendo even care?

[gehrehmee]

With DVD's at least, the issue is that the movies are available at different prices in different places. One could imagine a similar situation with gamecube games.

Re:Why would Nintendo even care?

[Guppy06]

"Why does Nintendo even care about this?"

Because what's the point of flushing money down a hole to maintain a presence in Europe when the people will just by from NOA anyway? Especially when you have to deal with governments trying to ban all video games outright? Why should they instead try to pander to a market that has been at best apathetic towards them?

import if they want

[jpt.d]

all Nintendo should care about us moving product, controlling distribution is farcical.

Get the problem at the source

[Tyrdium]

They should be taking advantage of the RIAA and taking legal action against Datel. I believe that counts as a "device to circumvent security measures," or whatever the RIAA calls it...

Re:Get the problem at the source

[Dave2 Wickham]

Except for the fact that Datel is a UK-based company...

Who cares?

[lightspawn]

If Nintendo doesn't want us as customers, Sony and Microsoft might.

Re:Who cares?

[metamatic]

Sony has a lot of the same problems, unfortunately.

SCEA (Sony Computer Entertainment America) often decides that the most innovative and cool games from SCEE are too good for America. e.g. Wipeout Fusion and Dropship were turned down by SCEA, Vib Ribbon for PlayStation was never released, and so on. If you've written yet another FPS, though, SCEA will release it.

Sometimes other companies (like BAM!) have stepped up and bought US distribution rights for Sony's European and Japanese titles. Sometimes not.

I really don't understand why SCEA turns down games that are on sale in Europe, delaying their distribution in the US by months or preventing it entirely. It's not even like they have to translate the game from Japanese.

Latest example: Silent Hill 3. On sale since May in Europe. Why the hell isn't it on sale in the USA? They expect us to wait until August while everyone on the net raves about it. Yeah, that makes sense.

i'm waiting

[fredrikj]

for samir gupta to comment

What's the point?

[seinman]

I don't see the point of this. Either way, Nintendo makes money... right? If they don't sell a game in one market, they still make the money off that game, because people buy it from another market. If anything, importing games help them make MORE money, because people who previously would be unable to purchase a game now can do so through various vendors.

Am I missing something here, or is this a pretty dumb move on Nintendo's part?

Re:What's the point?

[Snowspinner]

Here's what you're missing:

Retailers in Europe want to make money. They make money when they sell things. For instance, games. While it is all the same to Nintendo whether you buy their game in America or in Europe (Barring, of course, the fact that they'd like all of their regional offices to be profitable, and the fact that it's a lot easier to get a sense of where your system is popular if you have some region control), it is not the same to a British game store whether you buy the game in America or in Europe.

So if Nintendo begins having a high import rate, their retailers begin to complain about lost sales. If the retailers get angry enough, they stop stocking Nintendo products at all, because they're insufficiently profitable, and the shelf space could be used for, say, Sony products that sell better.

This would make Nintendo very sad.

Therefore, they have to keep their regional retailers happy, and to do that they have to enforce region-based distribution.

Re:What's the point?

[Guppy06]

"If they don't sell a game in one market, they still make the money off that game,"

But if that market is Europe, you need to include VAT. Europeans importing games from North America generally don't pay that VAT, but with the way things worth with the EU, Nintendo themselves will be blamed for it. The EU itself is already seriously considering holding on-line merchants outside of the EU accountable for collecting VAT (!), so how much longer do you think it will be before the EU starts holding NOE accountable for VAT on unauthorized imports? And that's just one of the ways that the cost of doing business (at least with video games) in Europe is higher than in either Japan or North America. There's also the money spent on making localized versions of games that don't violate local anti-speech laws (another area in which Europe may hold foreign publishers accountable for the actions of their own citizens).

Nintendo doesn't strike me as being all that concerned about import games. If they were, they'd have meaningful regional lock-outs in their games, which is something I don't believe they've ever done (short of NTSC/PAL incompatabilities). Notice mention of the lack of regional lock-outs in Pokemon Ruby and Sapphire. This isn't about import games in general, this is about import games in Europe in particular.

Re:What's the point?

[gmhowell]

So they've chosen to make their retailers happy, as opposed to their customers. (Well, yes, technically, the retailers are the customers of Nintendo, not the end users...) Wouldn't it make sense for Nintendo to satisfy everyone by making the games available to UK/European distributors? If the Europeans retailers want the games, they can call their distributor and get them for the end users.

Re:What's the point?

[gmhowell]

The EU itself is already seriously considering holding on-line merchants outside of the EU accountable for collecting VAT (!)

I'd like to see them try. Worst case scenario is to halt shipments at the border.

But if that market is Europe, you need to include VAT. Europeans importing games from North America generally don't pay that VAT,

Gotta pay for those socialist programs somehow.

And that's just one of the ways that the cost of doing business (at least with video games) in Europe is higher than in either Japan or North America.

If they were patriotic, and cared about the striking workers, they'd happily pay the VAT.

There's also the money spent on making localized versions of games that don't violate local anti-speech laws (another area in which Europe may hold foreign publishers accountable for the actions of their own citizens).

And yet, I could pick a story at random and find Europeans slagging the US for abridgement of various rights. Pot, meet kettle.

(None of this should be taken as defending the US 100%. I'm just requesting that the Europeans do what they ask Americans to do: examine their own actions, past and present, and own up to the fact that they aren't perfect.)

Re:What's the point?

[Snowspinner]

Except that the games are largely in Japanese. And localization does not take place instantly. And Europe is the hardest localization, seeing as it involves a bunch of languages.

Re:What's the point?

[gmhowell]

Are games localized for each country in Europe and/or the continent as a whole? I was under the impression that they just ran it through the equivalent of the ESRB and shipped an American English version. (Perhaps removing Nazi symbols). This is based just on having looked at a few games in MAME, where the World version is nearly indiscernable from the US.

Re:What's the point?

[Dave2 Wickham]

Games are usually translated into French and German, and console games obviously have to be converted to PAL. The English versions are still American English, though. There's also, I assume, a small delay in the UK for the BBFC to classify them, if requred, but I don't know if that amounts to anything.

Nintendo is dying

[WildBeast]

What a stupid move, anyway Sony and Xbox will gladly take over.

Re:Nintendo is dying

[jpt.d]

BSD is dying! Apple was dead 15 years ago! (as I type this on my ibook...)

As usual,

[Anonymous Coward]

the "N" is for Nazi.

And now, a short play...

[bluemeep]

Father: "Shucks Timmy, it looks like the order got cancelled."
Little Timmy: "No worries, pop. I'll just download it instead."

Nintendo repeats its past...

[deleted_soul]

Nintendo should stick to two things right now...

Making BETTER games for the Game Cube and
Making BETTER games for the Gamboy Advance (SP)

Nintendo's selection of original games have gone down drastically. If a game is seriously crappy then releasing it in another market is not going to save it. Reguardless of what you do to try and stop import releases.

The market as of this moment cannot sustain another video game war without consequences. If they keep releasing games without content they are going to die. Who needs to buy one game across 3 different systems? Seriously. I sure won't.

Resident Evil can only be done so many times before the series just bloats and dies. Look at what is happening with Tomb Raider. It took them this long to release a Mario Kart game?

Whats the deal with that? Why do we constantly have to be assaulted by truly horrible games and seriously overpriced hardware? Something has to break sooner later.

Re:Nintendo repeats its past...

[devnull17]

Ummm, nice troll?

Seriously, what the hell are you talking about? There's Eternal Darkness, Super Mario Sunshine, Metroid Prime, Zelda: The Wind Waker, Pikmin, Animal Crossing and Super Smash Brothers Melee. Each of those first- or second-party games is not only Gamecube exclusive, but a system seller as well. Name seven exclusive PS2 titles that justify a system purchase. I dare you. (The XBox has all of one.)

Furthermore, the Gamecube hardware is the cheapest on the market, at $150.

I'm not a Nintendo fanboy by any means. What Nintendo is doing in this case is inexcusable. But you clearly have no idea what you're talking about here. The market can and will endure anything as long as people want to play video games. And as long as Miyamoto is still making video games, I don't think Nintendo will ever be in any immediate danger.

Re:Nintendo repeats its past...

[Zico]

Actually, none of those games you listed were system sellers for the GameCube. For all practical purposes, about the only people buying those games were Nintendo fans, and they've owned the GameCube since it came out. That's why even when all those games appeared, GameCube sales still didn't surpass Xbox sales for the particular month in North America or Europe that they came out.

Re:Nintendo repeats its past...

[Anonymous Coward]

Nintendo fans bought their gamecubes because they knew Nintendo would be releasing those games. Hence - the titles sold the console. Just because they did it in advance doesn't mean they didn't do it.

Import is not illegal

[johannesg]

Why exactly does Nintendo believe something illegal is going on? There are no laws that restrict the citizens of Europe from buying in Japan, nor are there any laws that restrict Japanese shops from selling to European clients. If I wanted to order a dozen copies of a Japanese game there is absolutely no problem as far as the law is concerned. Moreover, I have the right to resell those copies in the local market.

Nintendo, on the other hand, is trying to control the distribution channel. I suspect that might just be illegal; it certainly sounds rather monopolistic. Maybe the commission should look into this again, although with their glacial speed we could expect a decision no sooner than 2015.

I guessed that Freeloader would annoy Nintendo

[easychord]

Thats why I own a US and PAL gamecube.

I bet that they are working on adding regional protection to games now that freeloader can't get past. I don't know if this is possible with the gamecube, but its the next logical step.

Re:I guessed that Freeloader would annoy Nintendo

[edwdig]

They've already pulled it off. The PAL version of Zelda won't work with the Freeloader. link

correction

[LittleBigLui]

"..the move will prevent [consumers] from playing titles [...]"

no.

the move will make consumers play pirated games instead of imported ones.

Re:correction

[lightspawn]

the move will make consumers play pirated games instead of imported ones.

I don't think so. Have gamecube titles been pirated yet?

Re:correction

[LittleBigLui]

i don't know. but if that is no incentive to do so, what is?

DVD prices in different places? No

[AtariAmarok]

"With DVD's at least, the issue is that the movies are available at different prices in different places"

The "out of region" DVD's I am interested in have been available in the other regions, and not mine, for at least 2 years. I am pretty sure there is no intent of ever releasing them in my region, so there is no price difference issue for this.

thanks, I was going to buy one

[jago25_98]

I was actually interested in buying a GameCube for a moment the other day after seeing SuperMonkeyBall2, thought it would go nicer with PC gaming.

Thanks for reminding me why I was disinterested in the 1st place, the same reason as XBox.

I really don't see what the big deal is

[clu76]

This isn't any worse than region coded DVDs, strict EULAs, DRM or putting tariffs on steel. Maybe these are unfair comparisons. But companies like Sony and Microsoft do things that are just as bad. Ofcourse, just because everybody else is doing it, doesn't make it right. Anyways, I'm done with my micro rant. I'm gonna go play my legally distributed copy of Animal Crossing now. :)

They're fixing the wrong problem...

[Man In Black]

Instead of preventing Europeans from circumventing Nintendo of Europe, why not make NOE a better choice? If people are buying from America, then why not listen to what they want and provide it?

Instead of staggered releases, just release the game at the same time in Europe, and people won't have to import it... AND they'll be buying from European stores. And why not look and see what's being imported most, and bring it over to Europe if it isn't there already?

Isn't this just common sense? (But then, I guess "instead of making proper copy protection, just creating a law making it illegal in the first place" has been the method of choice here in NA...)

Re:They're fixing the wrong problem...

[edwdig]

Lets say you're Nintendo. You have two options:

1) Release Metroid Prime in time for Christmas sales in the US (the market the game is most popular in), and then around the world several months later.

2) Release the game worldwide simultaneously in January/February, the months when the least games are sold (because everyone already bought a bunch for Christmas).

Which would you pick?

Re:They're fixing the wrong problem...

[clu76]

I'd choose what's behind door number 1.

Re:They're fixing the wrong problem...

[Anonymous Coward]

As usual, common sense has little to do with it.

When a game is completed, the local management want it in the shops the same day (ideally earlier). Given a market of the US's size, delaying the release of a game costs money. And even if you do not translate the game itself into all those odd European languages (remember they don't all speak Americanese), you will at least have to print instructions in a zillion tongues. And print boxes with all sorts of odd symbols that mean nothing in the US but may be required by EU or national laws. And so forth.

So marketing games is left to national managers in the EU who, of course, want to sell as many of their localized copies. And they think that if you cannot buy the US or Japanese edition of a game in genre X that you crave, that will miraculously make you interested in a European game in genre Y.

Welcome to the deep end of globalization. Watching your money and jobs go overseas does not necessarily mean all goods can come the other way.

Not Quite True

[Shanoyu]

Actually, you do not have this right in Japan. Several years ago Japanese video game producers lobbied for and got a law which essentially made it illegal to sell used copies of video games at stores. I am not all that familiar with Japanese laws regarding the sale and resale of media, but I believe this restriction also applies to movies.

The reasoning behind the law states that the sale of the video game represents the sale of the video game experience to the consumer, not the media itself. Thus the consumer does not actually buy the video game, but a licence to play the video game which is theoretically still the property of the producer.

This is clearly nonsense, but that is the way it goes with laws, eh?

Re:Not Quite True

[Eamon C]

Several years ago Japanese video game producers lobbied for and got a law which essentially made it illegal to sell used copies of video games at stores.

Holy Sh*t, thanks for the wake-up call! We're going to have to keep our eyes open for the RIAA and MPAA pushing for something like this (probably at the state level) soon.

Re:Not Quite True

[mink]

If this is true for video there are a number of stores that seem to visibly ignore the law.

Nintendo provide poor support in Australasia

[Anonymous Coward]

Nintendo's reputation is tarnished with their slow releases in differing regions.

Here in New Zealand, sales of Xbox and PS2 far outnumber the Gamecube sales.

To make things worse... Nintendo seem to not even care about releasing games within a reasonable timeframe. Generally a game will arrive many months after it has been released in the US. (In some cases 6 months after US release). Microsoft seem to have noticed this and release games in other regions with a much smaller delay - in some cases no delay at all. Nintendo may not realise how much this hurts their reputation.

One example is the recent release of Zelda. Zelda was released in New Zealand officially on the 9th May. They released a special edition of Zelda for people who pre-ordered the game which came with a bonus disk of N64 Zelda ported to GC and an extra memory card.

They didn't supply enough copies to meet demand. Many stores were only able to supply 50-60% of their pre-orders.

Why is this bad? It is a month later and the second shipment of Zelda has still not arrived - leaving many angry gamers. To make things worse, the second shipment has been announced that _when_ it does arrive, it won't have the bonus disk or memory card as with the first shipment.

Pretty good way to build and sustain customer base.... annoying the customers who care enough to pre-order and then show a lack of concern or care to meet demand within a reasonable timeframe then not supply what was originally advertised...

If they keep it up their customer base will halve with each new console.

Unfortunately for me, I bought a GC and a Gameboy Advance... luckily I can import games but seriously, we shouldn't have to import games. Mass importing obviously shows that a company is not listening to their customers!

Don't leave Out Microsoft!

[ronfar]

Don't leave out Microsoft!

I originally thought that Microsoft would be OK, I mean, how could an American based company figure out how to screw American gamers? (Of course, Europe is another story, but I'm making a point...)

Well, as it turned out, I was wrong. After getting us all hyped up for Shenmue II on the Dreamcast, SEGA makes a deal with Microsoft to not bring out the fully translated Dreamcast version in the United States! Technically, it was SEGA who screwed us, but I tend to feel some sympathy for "dying video game company on life-support" versus "800 lb. gorilla of the American software industry."

I'll admit that from SEGA's perspective, it would've been a good gamble if the Xbox version had been a hit, but it wasn't. They probably lost some goodwill from some Dreamcast owners on that.

Of course, I bought the European Dreamcast version from National Console Support. Incidentally, it made me wake up from considering buying an Xbox, myself. I mean, whatever expedient arguments I made to myself to justify buying it, just evaporated when I heard about the Shenmue II thing.

Articles like this make me really regret owning a Gamecube (I knew what Nintendo was like though... but I can't afford to by a new PC right now and I like playing games, damn it!) Oh well, I won't have to worry about them for much longer, I guess, if they make stupid decisions like this. Soon it will be Sony versus Microsoft, I guess. (Nintendo is not doing well in Europe, and they aren't doing so well overall that they can afford to spit on customers. I know they have Gameboy, but I could see them deciding to focus on portables in the future and leaving TV consoles to the "big boys.")

Are you that stupid?

[Inoshiro]

In the same paragraph, "Resident Evil can only be done so many times before the series just bloats and dies." and "It took them this long to release a Mario Kart game?"

So, what, you do or do not want them to overdo sequels? A whole bunch of Mario Karts per system, or only one?

The same thing is happening with sports titles. Unlike back in the day, when all I'd have to do is buy Blades of Steel and enjoy the best damned hockey game ever, EA has made a franchise out of releasing the same damned crap over and over again. Unforutunately for us gamers, the people who buy sports titles are stupider than the people who buy Army Men games (the other great Trip Hawkins money making scheme), so EA's not going out of business any time soon.

Capcom may have the most manic depressive release cycle ever, but Nintendo -- thankfully -- has not overdone its sequels. You can whine about the same thing two different ways in the same breathe all you want.

Parent +1 informative (N/T)

[gmhowell]

thx for the info.

Forgot about the PAL conversion. Didn't know they did language translations.

desist and cease

[Anonymous Coward]

And I thought I'd buy a GB Advance for my holiday.

Now I'll desist and cease to use my other 'tendo stuff.

For those of you who didn't read the article...

[jxa00]

What I found most interesting in the article, rather than the distributor crackdown was this quote from the author:

"...it's hard not to see this latest move as the thrashing of a platform holder which is becoming increasingly irrelevant in this territory and is grasping at straws to explain its own miserable failure."

Thats a big call, but Rob Fahey (the author) knows his stuff. I'm not sure if I agree with him here though...???

Live in Europe? Lobby for a change to laws

[Kris_J]

I'm fairly sure "parallel importing" of games is legal. I know it is for music. I also know it's legal in New Zealand. Region coding is illegal in New Zealand. If you think Nintendo is doing something wrong in your region, you really should be talking to your polititions in an attempt to get parallel importing protected. It should be your right to get products from wherever you want, as it should be your local store's right to do the same. The Global Economy doesn't just mean that companies can use slave labour in one country without any fear of their products being blocked in other countries, it means (or should mean) you can buy whatever you want from wherever you want too.