Sony and Microsoft have frequently been making headlines for a while now, with both giants seemingly being on a shopping spree for acquisitions. Microsoft not only completed its purchase of ZeniMax Media, but also announced a record-breaking acquisition of Activision-Blizzard for a whopping $70 billion. Sony has also been acquiring studios such as Housemarque, Nixxess, Firesprite, and most recently Bungie for $3.6 billion.
It seems as though both are constantly trying to one-up each other in this war of acquisitions, even if that isn’t the case. Either way, Nintendo doesn’t seem interested in the idea of acquisitions at this point, which many fans have found to be pretty surprising. As it turns out, though, there is a multitude of reasons as to why this is the case.
Why Nintendo Doesn't Need Acquisitions To Stay Relevant
Nintendo has been one of the industry’s fixtures for decades at this point, long before Sony and Microsoft made any moves in the space. The Kyoto-based giant is also behind some of the most iconic and longest-running gaming franchises of all time, including but not limited to Super Mario, Metroid, and The Legend of Zelda. As such, it has cemented its place within the industry by earning the trust and respect of billions of gamers around the world.
Nintendo primarily sells consoles through its excellent first-party franchises, meaning it doesn’t rely too much on third-party support to warrant a purchase of its systems. This is precisely the reason why its biggest failures such as the likes of Virtual Boy and Wii U didn’t hurt the company as much as many might have expected them to. Even when its systems might not match up to the competition in terms of horsepower, they have remained the only platform to play the latest Super Mario and The Legend of Zelda, which on its own guarantees an impressive amount of sales.
Sony and Microsoft absolutely have their own impressive first-party libraries, although they don’t hold the same attach rate as Nintendo’s best IPs. Thus, when Microsoft fumbled with the Xbox One and its lack of compelling exclusives - Sony was able to gain the upper hand by offering compelling exclusives such as The Last of Us 2, Uncharted 4, and God of War. When Microsoft brings a popular third-party publisher like Bethesda or ABK to its first-party roster, Sony has no choice but to answer that with key acquisitions of its own. Nintendo’s insistence on first-party driven sales not only ensured decent sales figures for the unanimously panned Wii U, but also invited a lot of newcomers to its ecosystems with its hybrid-handheld Nintendo Switch.
Another reason why Nintendo isn’t looking out for acquisitions is its unmatched diversity in its first-party portfolio and output rate. Nintendo easily outmatches Sony and Microsoft in terms of the sheer diversity of its first-party games. In addition to platformers like Donkey Kong and Super Mario, there are JRPGs such as Fire Emblem and Pokémon, racers like Mario Kart and F-Zero, fighters such as Smash Bros, action adventures such as Metroid and The Legend of Zelda, shooters such as Splatoon, and more.
Many of these franchises are considered to be one of the best in their class, which isn't the case with Microsoft or Sony, who have focused primarily on one type of experience for the longest time - multiplayer shooters and cinematic AAA blockbusters respectively. To address these criticisms, both Sony and Microsoft have to bring in even more studios to diversify their portfolios, all while keeping their output rates of compelling exclusives and popular IPs in check. Nintendo, on the other hand, already has a consistently high output rate of exclusives that matches that of the competition.
Without any acquisitions at all, Nintendo is currently growing stronger than ever in key markets such as Japan (where Sony used to be a stronger presence). With the company’s financials looking better than ever and its business model looking sustainable for the near future, Nintendo simply doesn’t need to go out of its comfort zone just yet.