112. monster game machine
“good. Then, let me tell you my request later, and I will tell you the solution first.”
“yes.”
“We are not breaking our contract with Sony, we are going ahead with it.”
“yes?”
Shigeru put on an absurd expression.
“If the contract goes through, as I just said, when third parties develop games on CD-ROM, all rights to approve and manage the project will be passed on to Sony.”
“you’re right. Let Sony actively manage that right.”
“What is that…”
When Shigeru still couldn’t understand exactly what Hoyoung meant, he continued with Hoyoung.
“However. Any game publishing contracts with third parties should be done by Nintendo. You’ll have to review the full contract to find out, but my guess is that Sony holds the license for the CD-ROM, but there’s no provision that Sony holds third party contracts either. Is that correct?”
“Hmm···. It certainly is.”
“Now, if you go back to Japan, call the representatives of the third party. And we are presenting new contract terms.”
“Which contract is it?”
“Currently, every time I release a game, 15% of the mask ROM cost per ROM cartridge, 15% production consignment royalty, 10% software development cost, 10% software maker margin, 6% advertising cost, risk aversion I understand you are paying 6%. Is it true?”
“fit···. It is.”
“Furthermore, 13% on margin for wholesalers and 25% for margins for retailers… This would be the current contract between Nintendo and the third party. Even if the game fails, even if the company goes bankrupt, Nintendo does not lose money, and if it becomes a hit, most of the profits go to Nintendo.”
Shigeru’s face turned red.
He seemed to think that it was too much tyranny even to himself.
“Furthermore, the structure that cannot be talked about even if there is a complaint is the most problematic. You can’t dare to go against Nintendo, which has a monopoly on the platform.”
“then···. What should we do?”
“First, clean up complex cost relationships. As much as it is carried out on CD-ROM, it eliminates the cost of basque rom and royalties for consignment production. And leaving only two things, the cartridge license fee and the platform fee, you can set the license fee low and the platform fee relatively high.”
Shigeru thumped his own knee.
“The cartridge license that will be handed over to Sony… So, you are saying that instead of lowering the CD-ROM license, we should make up for the loss as much as possible by increasing the Nintendo platform usage fee that comes directly to us.”
“That’s right. There will be no provision anywhere that says Sony will take over the right to change contracts with third parties that are already in contractual relationships.”
Shigeru nodded, and Hoyeong continued.
“Many third parties will once again pledge their allegiance to Nintendo. First of all, the manufacturing cost of the CD-ROM method is incomparably cheaper than the cartridge method, and it is impossible to pre-order and predict sales demand. Besides, royalties will also decrease? There will be no third parties to object.”
“okay. I see what you mean. In the end, it seems that our biggest misjudgment was trying to stick to Nintendo’s name only with cartridges vs. CD-ROMs.”
“yes. You got it right.”
Hoyoung smiled softly.
Actually, it was something that could make you feel bad if you heard it wrong, but Shigeru listened to Hoyeong’s story with an open mind.
“But I do have one concern.”
“Are you worried?”
“yes. Minoru Arakawa is the one who most strongly advocates breaking the contract with Sony.”
“Arakawa Minoru?”
“yes. That person is the son-in-law of Yamauchi, the current president of Nintendo.”
After Hoyoung pondered over her memories, she was able to recall memories of him.
‘Arakawa Minoru. He was the representative of Nintendo America. He is a man of great merit in winning the battle against Sega America. He must have been the son-in-law of Yamauchi’s son-in-law.’
After thinking, Hoyoung opened her mouth.
“Does he have any reason to want to break the contract?”
“The external reason is that Sony will take away all of our interests with this contract.”
“Outside? Is there any other reason then?”
“Actually, Minoru was almost fired from the company once. In the early 80’s, he was in charge of exporting a game called ‘Radar Scope’ to North America. However, he made a mistake in forecasting demand, so the radar scopes were barely sold and remained in bad inventory.”
“I know that story. It was Shigeru you who remade the radar scope into Donkey Kong and brought it to the North American market, and then grew it into a $100 million annual sales company while handling all the inventory.”
“That’s right. From then on, Minoru said that the achievements of Nintendo America today were not his own, but mine… I suffer from some sort of inferiority complex.”
“That’s why there is an obsession to be acknowledged by your father-in-law, and you’re risking your life for this.”
“That’s right.”
Hoyeong said as if it was no big deal.
“How is his job performance?”
“In fact, I also acknowledge only the work ability. I made Donkey Kong, but he was the one I sold. I couldn’t have done this without the ability.”
“Then do this. I will be in the US soon. You are going to see him right now.”
“So?”
“Tell him about the conversation you had with me a moment ago, and induce him to lead this contract change.”
“Will he really follow me? I am now strongly insisting on breaking the contract with Sony.”
Hoyoung looked straight at Shigeru.
“That is the point of this work. There are only two ways Nintendo can avoid losing in this situation. Either persuade Minoru to convince Chairman Yamauchi, or you, Shigeru, convince Chairman Yamauchi.”
Shigeru narrowed his brows involuntarily.
Neither Minoru nor Yamauchi were easy opponents for him.
“If I can tell you one thing clearly, the evaluation of the public in the future will praise the person who led to change this contract.”
Shigeru responded by clapping his hands.
“Then let’s go to Minoru. If I emphasize that point to Minoru, I think he might come over.”
“But if that happens, all the accolades and the reputation for setting a new paradigm in relationships with third parties will be his, okay?”
Shigeru smiled.
“Fame? Do I need more fame? I am Shigeru Miyamoto.”
“Haha, sorry. I brought up a useless story in front of Shigeru.”
“no. And if Minoru refuses, it’s only then that I can go to the president directly.”
Shigeru thought to himself that he wished it hadn’t happened that way.
If he went directly to the chairman and insisted on maintaining the contract with Sony, then it was because he would have to face Minoru’s forces.
“Thanks to the conversation with Hoyeong, it seems that my eyes are opened to some extent.”
“Thank you for thinking so. If it is in the form of an agreement as it is now, there is nothing stopping you from doing business with us.
“By the way, didn’t you say you had a favor? What is your request?”
Hoyoung straightened her posture and said.
“It’s none other than the story of the Japan Telecommunications Agency.”
“Correspondence?”
“Shigeru-san, do you have any connections with the Communications Agency?”
“It’s a communication request… There are a few people I know well. When releasing a game, the government has to go through deliberation, and the subject of that deliberation is the Communications Agency.”
Hoyoung’s eyes sparkled.
“Then can I take a seat with the Telecommunications Agency’s Wired Communications Division?”
“The Wired Communications Department?”
“yes. Currently, the speed of PC communication in Japan is terrible. I want to export the ADSL technology of one of my companies, Hermes Telecom, to Japan.”
“ADSL technology, it seems to be a type of communication technology.”
Hoyoung briefly explained ADSL to Shigeru.
“A technology that is dozens of times faster than the current PC communication and can use the phone line as it is, so if it enters the Japanese market, it will probably cause great innovation.”
“But what I hope is more than just introducing fast internet.”
Shigeru felt that Hoyoung was dreaming of a bigger future.
“In addition, we will create a communication port in the new game machine and add communication function. So that users can all play net play together.”
“okay. It’s like playing an online game.”
Hoyoung nodded.
Shigeru looked at Hoyoung calmly and felt something boil in his heart.
‘Honestly, I thought I was a genius too, but Hoyoung is a real genius.’
Whether or not Hoyoung knew what Shigeru was thinking, he opened his mouth.
“It is difficult to play games smoothly with the current PC communication speed in Japan. However, at the speed of ADSL, you will be able to enjoy a pleasant game. If you happen to come to Korea later, check the speed.”
“Hmm… Okay. Sooner or later, I will arrange a place for you. Will you come by yourself then?”
“no. I’ll send someone else. Shigeru is someone I know well.”
“okay? Who are you talking about?”
“This is Kim Joo-jung.”
“ah! state summit. There was a time when I was contacted that I was leaving H&H and changing jobs.”
“yes. Hermes Telecom was the place I came to after leaving the company.”
“Kim Ju-sang is fluent in Japanese and well versed in Japanese affairs, so he will undoubtedly communicate well with the person at the Korea Communications Agency.”
Hoyoung had the same thoughts as Shigeru.
“Oh, it’s already approaching 9:00 AM.”
“okay. So, today’s story should end here. I need to get some rest and fly to Nintendo America headquarters in Washington.”
“I hope for good results.”
“yes. Thank you for those kind words.”
Hoyoung and Shigeru toasted the last of the wine, drank it in one go, and stood up.
Shigeru called a taxi to return to the hotel, and Miru, who was waiting at the corner of the store, approached Hoyeong.
“Director. Are you okay? It looks like you drank too much.”
“I drank a lot, but I’m not drunk.”
Hoyoung really smelled like alcohol, but his eyes were clear.
‘If this goes well, the two game machines that should have been born in the original history will not be born.’
The two game consoles Hoyoung thought of were the Nintendo 64 and PlayStation.
‘Instead, a monster game machine that combines only the strengths of the two machines will be born.’
Hoyoung seemed to be thrilled for a moment.
What if Nintendo 64 masterpieces such as The Legend of Zelda, Ocarina of Time and Super Mario 64 were played on hardware like the PlayStation?
‘It will definitely make a big mark in the game world.’
And Hoyoung had taken a step forward in this project.
However, this project was not completely Hoyoung’s own project.
‘I’ll have to hurry up a bit more.’
However, Ho-young owned a company that would become just as huge.
“Chief. How many days do we have until our flight back to Korea?”
“Five days later.”
“Enough. Since you haven’t had a day off today, could you take a day off and look for a plane ticket when you have time?”
“of course. I will find out first before resting and rest comfortably.”
“Don’t push yourself too hard.”
“It’s because I’m the type of person who can’t rest when I have things left to do. Where is your flight going?”
Hoyoung laughed as if he couldn’t help it.
“I’m going to Irvine, California. No, should I just cancel the flight back to Korea and change it to one departing from Irvine? There is nothing to see in New York anymore.”
“All right. I think that would be good. If it’s Irvine…”
“I’ll stop by Blizzard and then go back to Korea.”
Hoyoung was thinking of urging Blizzard.
