The president of the major Japanese video game company was speaking at a Nintendo management strategy meeting in Tokyo two days after the company booked solid sales of its "Gameboy Advance SP" handheld unit but poor sales of home-use "GameCube" game console for the three months ended June 30.
Iwata said many video games lost their allure as they gradually became too difficult for average users to enjoy. Today's sports video games that make users almost feel like they're playing the real thing won't keep game fans hooked indefinitely, Iwata argued.
Despite the popularity of such virtual reality-focused high-tech video games, Iwata said investing too heavily in developing such games "would be an extremely dangerous idea."
Those aren't surprising remarks coming from Iwata, who's been pushing hard to strengthen Nintendo's new identity as a developer of simple game products.
One relatively down-to-earth product, "Gameboy Advance" handheld game player, has been a hit for the game manufacturer.
For the three-month period to June 30, Nintento sold 3.24 million units globally of the toy, and Iwata reiterated the company is on track to sell 20 million units of the products worldwide in the year ending March 2004.
He said Nintendo is boosting production to meet strong demand for "Gameboy Advance SP", and by the end of August, monthly output will slightly exceed 2 million units.
Nintendo's home-use "GameCube" game console, on the other hand, has been a disappointment, selling only 80,000 units worldwide During the April-June quarter, as the company worked off its inventory.
But Iwata said the inventory "has now gone back to an appropriate level."
Brushing off skepticism among analysts that the firm can meet its six-million unit sales goal for "GameCube" for the fiscal year to March 2004, Iwata said "it is possible to meet the annual target."
He reckons new releases of software titles such as "Mario Kart" series starting November and "Pokemon Coliseum" will boost the sales of "GameCube" consoles globally by the end of March 2004.
"Pokemon Coliseum" will be released in November in Japan, while its release overseas may slightly be delayed to sometime between January and March of 2004, Iwata said.
The Nintendo president also said the company is going to release a "GameCube" version of its popular "Wario Ware, Inc." software in October this year, as well as a new "Donkey Kong" title that it is co-developing with Namco Ltd. (J.NAO or 9752) by the end of 2003.