The full details for the Nintendo Switch Online Expansion Pass have been announced, and the
price point is somewhat higher than many potential subscribers had been expecting.
Access to Nintendo 64 and Sega Mega Drive games, along with Animal Crossing: New Horizons
DLC Happy Home Paradise, will cost $50 a year in the US, or £35 in the UK.
Many fans are less than impressed by this cost, so why has Nintendo set the Expansion
Pass price so high?
As we noted in our video on Super Mario 3D All-Stars last year, Nintendo has always planned
to build up their online subscription service – and that plan has always involved offering
N64 games.
Said Nintendo president Shuntaro Furukawa: “Subscription-based services are becoming
common in all sorts of industries, not just the games
Industry…
“We believe that we need to further enrich these sorts of services in the future.”
When asked in an investor meeting about bringing N64 games to Nintendo Switch Online, he said:
“We are currently offering Nintendo Entertainment System titles as part of the Nintendo Switch
Online service.
This is just one of a variety of forms in which consumers could play past titles, and
we'd like to deliver them in some form.
We are very aware that many of our consumers have been asking for a way to play older titles
like this.”
The challenge that Nintendo Switch Online has faced is this “variety of forms” that
offer competing ways to play iconic Nintendo games.
The hugely successful Super Mario 3D All-Stars highlights how Nintendo has struggled to commit
wholeheartedly to a subscription service.
However, over the past couple of years, something big has shifted.
According to an investor presentation, in the first year that Nintendo Switch Online
was available, it gained approximately (the official numbers aren’t clear) 10 million
subscribers.
By the end of its second year, the service had reached 26 million subscribers.
The cause for such a large increase in subscribers: Animal Crossing: New Horizons.
The game convinced tens of millions of players to embrace the online subscription service,
with the result that the subscriber base is now far more lucrative for Nintendo.
The next step, according to Furukawa, is to add greater value to the service - and see
how many of these subscribers can be convinced to pay even more money:
“For Nintendo Switch Online, it's important not only to increase the number of new members,
but also to encourage existing members to continue using the service, so we are working
on increasing the appeal of the service to make it even more fun and convenient to play
with Nintendo Switch.”
While the most dedicated of Nintendo fans have been asking for N64 and GameCube games
for years, the biggest proportion of subscribers are more interested in Animal Crossing.
Happy Home Paradise is the main seller for the Expansion Pass at present, and Nintendo
has priced the service to reflect the money they would otherwise have made selling the
DLC to consumers.
Nintendo, after all, has a history of refusing to reduce the price of their products, even
if it loses them sales in the long term.
It’s also worth mentioning issues surrounding licensing.
According to industry insider Emily Rogers: “Licensing costs are likely main culprit
behind NSO expansion's bold price.
I heard Sega were paid very, very well… “3rd parties titles (Konami, Capcom) are
also being licensed for Genesis NSO.
So the licensing costs begin to add up after awhile.
And who knows what licensing agreement/arrangement Nintendo had with Rare/Microsoft...”
It is likely true that licensing costs are only set to increase over time for subscription
service offerings.
With Microsoft throwing billions of dollars into building up Xbox Game Pass, it’s going
to be increasingly difficult for other gaming subscription services to keep up financially.
At the same time, Nintendo being Nintendo, it’s unlikely that the company would have
agreed to any deal with Sega unless they were absolutely happy with it.
Licensing may be a factor, but Nintendo likely wouldn’t want to give too much money away
for Mega Drive games that can already be purchased for cheap on the Switch.
It’s also worth noting that the goal here is not just to make subscription money.
Nintendo is hoping to use these classic games to lure in nostalgic parents, who will then
introduce iconic Nintendo brands to their children.
Said Furukawa: “We always hope that our products are enjoyed
by a broad audience of many generations, from children to adults.
In the many years we have been in the video game business, we imagine people from a very
broad range of generations have been playing Nintendo platforms.
“We'd like to continue to consider methods for communicating the appeal of Nintendo products
to the parent generation, including series such as the NES and SNES versions of Nintendo
Classic Mini as well as classic content in our online services.”
So the moral of the story?
The family that plays together, pays together.
Considering our daughter’s continuing Zelda obsession, we can’t fault their logic.