Switch Can Break The Traditional Hardware Cycle And Become Nintendo’s iPhone, Says Analyst – Nintendo Life

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Nintendo Switch© Nintendo Life

The Nintendo Switch is selling amazingly well – so well, in fact, that Nintendo is struggling to keep pace with demand after more than three years from launch. Switch sales up are up 95% in the first half of the current financial year, and that has seen Nintendo’s share value rise 30% in 2020 alone.

Much of the current confidence in Nintendo stock is down to the Switch’s astonishing success, but in the eyes of more cautious investors, the firm is now at something of a crossroads; the Switch isn’t going to be around forever, and the circular nature of the video game hardware arena means there’s the risk that the Kyoto-based veteran could fumble its next machine, just as it did with the Wii U, which followed-on from the insanely popular Wii.

However, there are some which believe Nintendo has learned its lesson and that instead of creating an entirely new hardware platform, it will follow Apple’s iPhone model by simply upgrading the Switch and keeping players firmly rooted in its current software ecosystem.

Speaking to Bloomberg, Toan Tran of investment manager 10 West Advisors said:

With every console generation, the install base resets to zero and their earnings power essentially resets to zero. They can continuously have an install base of say 100 million consoles out there, that just moves along over time.

The logic is sound – by keeping people tied to the
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