The History of Nintendo: Driving the Gaming Industry One Console at a Time

The Nintendo brand is recognized all over the world and is one of the biggest names in the entire gaming industry. The company began as a manufacturer of playing cards over a century ago and has evolved to be a leading force in gaming and technology. It hasn’t been an easy ride, however, and the history of Nintendo has been hard-fought battles with fierce competition and changing consumer behavior.

At Business2Community, we’ve analyzed our trusted sources to give you an in-depth history of the Japanese gaming giant. Keep reading to find out how Nintendo has adapted and innovated to remain at the top of its game.

Who Owns Nintendo?

Nintendo is a public company, headquartered in Japan. It has around 7,300 employees worldwide. The company’s largest shareholder is the Master Trust Bank of Japan, Ltd. (Trust Account), with 194,104 shares, representing a 16.54% ownership stake in Nintendo.

Nintendo was founded in 1889 as a playing card company by Fusajiro Yamauchi. Originally based in the ancient Japanese city of Kyoto, the business sold handmade Hanafuda cards. The cards were beautifully decorated by hand and quickly became so popular that Yamauchi had to recruit staff to help him make them.

Who is the Nintendo CEO?

Shuntaro Furukawa has been CEO of Nintendo since 2018. He succeeded Tatsumi Kimishima who served for just three years following the death of the former president, Satoru Iwata.

Satoru Iwata is remembered in the business and gaming world for taking a 50% pay cut to avoid staff lay-offs after the Wii U console flopped, pushing the company into several loss-making years. He believed that by holding on to its talent, Nintendo would have a better chance of making a successful comeback.

A full list of CEOs/Presidents is below:

Growth and Development of Nintendo

Based in Japan, Nintendo has been a leader in the at-home video game industry since the early 1980s.

Here we’ll run through some of the important moments in Nintendo’s history to help you understand how the company developed into a truly global brand.

1889-1962: Nintendo Begins as a Manufacturer of Japanese Playing Cards

In 1889, Fusajiro Yamauchi began making playing cards for the Japanese game of Hanafuda. Hanafuda playing cards were intricately decorated and Yamauchi made them by hand.

Hanafuda cards became popular in Japan after the government banned most forms of gambling. Many other card manufacturers had moved out of the market for fear of being linked to criminality, but Yamauchi persisted and soon became the main producer of Hanafuda playing cards. With this increase in demand, Yamauchi had to hire staff to help him produce cards on a more industrial scale.

In 1925, the company started to export Hanafuda playing cards to Japanese communities around the world. The Second World War left its mark on the Japanese economy but the playing card industry handled the turmoil better than most. In such difficult times, people needed cheap entertainment and the company thrived in the post-war years.

In 1950, the great-grandson of the company’s founder, Hiroshi Yamauchi, took over and was intent on modernizing and improving the way the company was run. In 1951, he changed the company’s name to the Nintendo Playing Card Company, or Nintendo Koppai. The meaning of the word Nintendo isn’t fully understood but it’s thought to loosely mean “leave luck to heaven” in Japanese.

By 1959, Nintendo had become powerful enough to attract a partnership with Walt Disney to design and manufacture playing cards featuring Disney characters. Business was booming, and in 1962, Nintendo decided to go public on both the Osaka and Kyoto stock exchanges.

1962-1985: Nintendo Makes its First Moves into the Video Game Industry

Throughout the 1960s, Hiroshi Yamauchi led a push to diversify the company’s products. In 1963, the company began to sell board games. By 1969, the games division had become so successful that Nintendo was able to build a brand-new facility for manufacturing games.

However, it was in 1970 that Nintendo made the move that would eventually transform the business going forward, introducing its Beam Gun Series of arcade games. Selling electronic technology in Japan for the first time, Nintendo produced games, such as the laser clay shooting system, that gave arcade players an exciting new digital experience. The new products were so successful that, by 1974 Nintendo had begun international exports to both the USA and Europe.

Over the coming years, Nintendo led the way in advancing arcade game technology. In 1975, Nintendo partnered with Mitsubishi Electric to design and produce a video game system: the Nintendo Color TV Game 6. While the technology remained fairly simple, by 1977, Nintendo was marketing the Color TV Game as part of the first generation of home video games.

Nintendo continued to develop its arcade games, adding increasingly more sophisticated technology. In 1978, Nintendo created video games with innovative built-in microcomputers. This development enabled Nintendo to design arcade video games with more complex graphics and better sound, including the 1981 smash hit Donkey Kong. In the early 1980s, Nintendo released the Game and Watch series of handheld electronic games.

In 1980, with business growing rapidly overseas, the company decided to set up a US-based subsidiary, Nintendo of America, Inc.

Throughout the 1980s, Nintendo focused on the design and development of home video game technology. In 1983, Nintendo built a new production center in Japan to meet demand for its new flagship product, the Famicom. Famicom games were arcade-quality video games that could be played at home. Despite the crowded marketplace, including the Sega SG-1000, the Famicom was an immediate success with more than 2.5 million sold by the end of 1984.

Nintendo began to prepare to export the Famicom to the USA. However, by the time Nintendo was ready, the US home video market had experienced a sharp decline. After an enormous boom in the late 1970s and early 1980s, the US market was in freefall, leading to large losses across the industry. Industry revenue fell by 97% between 1983 and 1985, plummeting from $3.2 billion to just $100 million.

This, however, didn’t appear to faze Nintendo. The company continued to market its games amid the downturn and received a positive response. This led the company to believe that the US industry’s problems were down to an influx of dull, poor-quality, and cheap games.

1985-1990: Nintendo Proceeds to Dominate the US Market

Undeterred by the challenging marketplace, Nintendo brought the American version of the Famicom to the USA in 1985: the Nintendo Entertainment System (NES). The NES was an incredible success, and it went on to dominate the US market. It even started to catch on in Europe too. It’s estimated that the NES was in almost one-third of US homes by the end of 1990.

Interestingly, to get it into as many homes as possible, the NES was sold at about $100 which was close to cost price. The profit for Nintendo was in the sale of its exciting licensed game cartridges made in partnership with software companies. In this way, Nintendo built up significant customer loyalty and enthusiasm. By 1989, this had led to almost an 80% share of the $3.4 billion home video game market for Nintendo.

Nintendo’s dominance soon led to scrutiny, criticism, and litigation from disgruntled competitors, the US government, and game licensees. A lot of this was caused by Nintendo’s demanding market controls which it believed safeguarded it against a similar market crash to that of the early 80s. For example, Nintendo licensees were only permitted to release six new games each year.

In 1989, Nintendo also made a landmark return to the handheld electronic games market with the launch of the iconic Game Boy. The battery-operated Game Boy offered gamers interchangeable game cartridges, stereo sound, and state-of-the-art graphics.

The same year, in Japan, Nintendo also released a 16-bit version of the Famicom, known as the Super Family Computer. Through its improved technology, the Super Family Computer was able to provide more challenging games with better graphics and more realistic sound. This would later become the Super Nintendo Entertainment System or SNES.

1990-2002: Nintendo Battles Sega and Sony for Gaming Supremacy

The 1990s gave Nintendo its first real competitor in the form of Sega Enterprises, a company that was seeing increasing success in the market. Sega’s 16-bit Genesis System had been the driving force behind Nintendo’s upgrade of its 8-bit technology.

Nintendo did benefit from exceptional customer loyalty and engagement. While video game sales generally dropped by 40% in 1990, Nintendo managed to increase sales by 63%. The 90s saw the release of some of Nintendo’s most recognizable game titles such as Street Fighter II – an immediate success – and a sequel to its Zelda character. Both brands would quickly become cash cows that would support the company for decades to come.

By the end of 1992, Nintendo held 80% of the US’ $5.3 billion market despite competition from Sega. However, Sega launched an aggressive marketing campaign that effectively deemed Nintendo’s games to be children’s toys.

The competitive threat heightened in 1994 when a new generation of video game consoles was released. Sega’s Saturn and Sony’s PlayStation both boasted 32-bit systems and CD-ROM drives. Both machines also offered large storage capacity but, on the downside, they weren’t particularly fast. Nintendo, however, used faster but pricier silicon storage cartridges. Committed to following its own path, Nintendo concentrated on developing a 64-bit processor with even better capability.

In the meantime, Nintendo tried to entice customers to stick with the 16-bit SNES by bringing out exciting new games. The company released a 16-bit version of Donkey Kong Country, originally designed for the upcoming 64-bit system. The game received several accolades, sold 9.3 million copies worldwide, and was the fastest-selling video game at the time.

Nintendo had always relied heavily on independently produced games, but in 1995, the company bought a 25% stake in UK developer Rare Ltd. to enhance its in-house software development capabilities.

The Nintendo 64 (N64) was finally released in 1996. Its launch price in the USA was $199, making it an affordable new console compared to the PlayStation and Saturn. With several games ready to go, it also got a launch in the UK, Europe, and Australia in 1997. By the end of Nintendo’s financial year, it had sold 5.8 million units of the N64.

The N64 launch got off to a good start but came up against some challenges. Only a few games were ready and the market had a new competitor: the personal computer (PC). PC manufacturers were releasing more and more sophisticated games and poaching top software developer talent.

Crucially, however, the N64 had a limited number of games available, which is where Nintendo made its profit. Another gripe of Nintendo’s game makers was the lack of capacity in the N64. The company began to work on a magnetic disk drive and communications device. Progress was slow, but Nintendo received a much-needed boost in 1997 with the release of the new Pokémon game for the Game Boy.

In 1998, Nintendo released the Game Boy Camera, which sold more than 700,000 units in its first five weeks on the Japanese market. Nintendo also released the Game Boy Color in 1998 and GoldenEye for the N64, a game based on the latest James Bond movie, was another hit.

Later that year, Nintendo launched The Legend of Zelda: Ocarina of Time. It won the AIA Game of the Year award and, according to Guinness World Records, it is the most critically acclaimed video game in history.

Sony’s new PlayStation 2 (PS2) was released in 2000 and was a huge success, eating into Nintendo’s market share. Nintendo had to work hard to ensure its next console could compete. It partnered with several top players in the electronics and computing world to create the media system for the new game console, the Nintendo GameCube. With the launch of titles such as Diehard and Resident Evil, Nintendo managed to attract a more mature audience.

In 2001, Nintendo celebrated the 20th anniversary of both Mario and Donkey Kong with new games released to coincide with the introduction of the Game Boy Advance. The Game Boy Advance received a positive reaction, but the entire gaming market suffered following the 9/11 attacks.

2002-2024: A Turbulent Time Ended by the Switch

Hiroshi Yamauchi stepped down in 2002 after 52 years at the helm and was succeeded by software developer Satoru Iwata.

In 2003, the Game Boy Advance SP was released. Despite the new product’s success, Nintendo suffered unexpected losses thanks to the poor performance of the yen. In response, Nintendo lowered the price of the GameCube and got ready to make bigger moves into China’s video game market. The company also bought a 3% stake in Japanese software developer and toy manufacturer Bandai Company.

In a bid to tempt customers away from its rivals, Nintendo lowered the price of its popular Game Boy Advance, released two new Pokémon games, and its latest handheld device, the Nintendo DS. The Nintendo DS was wireless and featured surround sound, top-quality graphics, and voice recognition. The company had high expectations for the Nintendo DS.

While Sony’s sales were far bigger than those of Nintendo and Microsoft’s Xbox, Nintendo’s products continued to draw in new gamers, as well as loyal fans, and the company’s creative games and characters remained popular.

In 2006, Nintendo introduced the Wii console which came with some innovative new features, such as motion-sensitive controllers and built-in Wi-Fi. By 2008, the Wii had become the first video game console to sell more than 10 million units in the USA in one year. These features gave gamers a completely different at-home experience, opening up access to a range of new game styles. The Wii Sports game, for example, has sold over 82 million copies worldwide, more than any other individual Nintendo game.

Another innovative release came in 2011 with the Nintendo 3DS which opened up 3D content for gamers without the need to wear 3D glasses. While Nintendo was forced to sell the device at a very low profit, it became a big hit. Nintendo then cleverly cashed in by launching a bigger XL version which was cheaper to produce but retailed at a higher price.

However, 2012’s Wii U release was less successful. Selling just over 13 million units, the Wii U was one of Nintendo’s poorest-selling systems. It marked a difficult time for the company. For the 2012 financial year, Nintendo posted an annual operating loss of $459.54 million and a net sales decline of 36.2%.

The Nintendo Switch, the console that many hail as the savior of Nintendo, was then released in 2017, following several years of challenging financials. The Nintendo Switch has been an enormous success for the company. Since its release, it has regularly been top of the sales charts and, within the first six months of launch it had already outsold the total sales of the doomed Wii-U.

Even though the Nintendo Switch is more than 7 years old (nearly twice as old as the Xbox One and PlayStation 5), the company isn’t expected to launch its next console (the Nintendo Switch 2) until March of 2025 at the very earliest. Some of Nintendo’s newest flagship games, including the latest Legend of Zelda game “Tears of the Kingdom,” runs relatively poorly on the old and underpowered device.

History of the Nintendo Logo

Despite its innovative nature, Nintendo has changed its logo very little since 1967. The company’s simple logo design has kept the brand recognizable for decades.

The current version, which was introduced in 2016, features a return to the red and white color scheme. Nintendo has switched between black, grey, and red over the years, as well we experimenting with different enclosures for the lettering.

The first logo from 1898 shows three Japanese Kanji characters that spell Nintendo. This original phrase is still used in Japan as the official company name.

Latest Update: Nintendo Switch 2 is Coming

The highly anticipated Nintendo Switch 2 has been generating buzz in recent months as rumors and leaks suggest its release could happen between April and June 2024. Here are some of the key updates:

• Bigger Screen: The Switch 2 is rumored to feature an 8-inch LCD screen, a step up from the current 7-inch OLED model. There may also be multiple models available, including one with OLED technology.
• Improved Power: The new console is expected to have a performance level comparable to the PlayStation 4 Pro, which would bring much-needed graphical enhancements, enabling it to handle larger, more demanding games.
• Upcoming Games: One of the first confirmed games for the Switch 2 is My Time at Evershine, a crowdfunded title, alongside popular first-party franchises like Pokémon.
• Release Timing: Speculation points to a potential launch window in mid-2024, though no official date has been announced yet.

The Future of Nintendo

Nintendo has overcome several challenging periods in both the gaming industry and the global economy, thanks to its innovative approach and commitment to bettering competitors’ devices rather than matching them. In 2020, Nintendo was named the richest company in Japan.

Looking to the future, Nintendo appears to be focusing on fostering deeper loyalty and engagement with its customers. This relationship and insight into customer behavior and needs may help the company develop the next big thing in video gaming.

In 2021, Nintendo President Shuntaro Furukawa said:

We seek a virtuous cycle with our integrated hardware-software business and the provision of services and content based on Nintendo Accounts, in which touchpoints are created with ever more consumers and strengthened to establish long-term, mutually positive relationships

What the next big thing will remain to be seen, but history suggests that Nintendo will quite likely lead the way.

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