ABSTRACT
This chapter draws examines the company’s economic profile, drawing on historical patterns. Like the rest of the industry, Nintendo has centered around console cycles, releasing new consoles roughly every three to five years. But more so than most other companies in the industry because of its narrow focus, it has operated with much thinner margins. With this in mind, the chapter examines the company’s two primary markets – hardware and software – in order to better understand the role each of them plays in the company’s success. It, then, looks at the company’s use of licensing and outsourcing, its patterns of intellectual property control, maintenance of cash reserves, and minimizing of component costs as key strategies in navigating those margins. Next, it examines how the company is structured to facilitated relationships with key production partners and related industries. It concludes by looking at the company’s recent moves toward integration and expansion beyond video games.
