The SFC Sold Out

At Nintendo Headquarters Yamauchi Haku Kyoto, on Hiroshi Yamauchi's desk, there was only a thin sheet of fax paper, but the numbers on it weighed a ton.

"Two and a half million -"

He exhaled a smoke ring, the sound not loud, but even Shigeru Miyamoto standing to the side could feel the barely suppressed smugness emanating from him.

"President, this has far exceeded our most ambitious expectations." Shigeru Miyamoto said, proud of the success of his Mario game, but that was all. He was more concerned about the player experience after getting the game.

Yamauchi Haku didn't look at him, but tapped the paper with his knuckles. "Expectations? My expectations are much higher than that."

He abruptly changed the subject, his tone turning cold. "What did the production line say? Why did the shipments drop in the second week? Tell them, I need machines, as many as you can!"

"President, the suppliers—" a department head explained hesitantly, "This year's economy is sluggish, they—they dare not stock up on materials on a large scale, the financial pressure is too great, unless we can pay in full in advance—"

"Useless!" Yamauchi Haku his cigar into the ashtray. "A bunch of idiots who can only see the ground beneath their feet! Can't they see how big this business is?"

The air pressure in the office instantly plummeted to freezing.

No one dared to speak again.

Everyone knows the president's temperament; he only cares about results.

The result is that the market is extremely hungry, but they can't supply any goods.

Meanwhile, the entire Japan game industry was stunned by the results Nintendo had delivered in the past two weeks.

Major gaming magazines went to extra print overnight, reporting on the social phenomenon sparked by "Mario" with the most sensational headlines.

Analysts were making pronouncements on television, asserting that Sega's era was over and that Nintendo would usher in an unprecedented and more solid dynasty with the Super Famicom.

This wave of fervor naturally reached everyone at Sega Headquarters as well.

The confidence that had been built up in the conference room thanks to the executive's encouragement was completely washed away in the face of the staggering figure of 2.5 million units.

In the corridor, employees met but with fewer smiles than usual, and their voices were much lower. The topics always circled back to that red name.

"Have you heard? The latest data shows it's already at 2.5 million."

"My God, it's only been half a month!"

"MD is probably... - throat."

When the assistant walked into Nakayama Takuya's office with the latest summary report, his palms were sweating. He felt as if he were holding not a report, but a letter of defeat.

"Special Affairs."

Nakayama Takuya was looking out the window when he heard the sound. He turned his head, his expression as calm as ever.

"Speak."

"The Nintendo Super Famicom (SFC) has sold over 2.5 million units in just two weeks since its release." The assistant's voice was a little hoarse. He quickly added, "However—the report analysis shows that their sales declined significantly in the second week, not because of decreased demand, but because production capacity couldn't keep up."

He carefully observed Nakayama Takuya's expression, afraid of seeing even the slightest wavering.

However, Nakayama Takuya simply nodded and took the report from his hand.

"Productivity—" he murmured, a strange smile suddenly appearing on his face, "It seems the aftereffects of the bursting bubble are more severe than I imagined."

The assistant was taken aback.

"Nintendo's suppliers are all local companies. These factory owners are like frightened birds now. They want to hold onto any money in their pockets tightly. Who would dare to spend money and materials to expand production?" Nakayama Takuya's finger lightly traced the declining sales curve on the report.

"He wanted the horse to run, but he didn't consider that the horse also needs to eat grass. Now look what's happened, the grass is gone."

He casually placed the report on the table and looked at his assistant, "This perfectly proves my judgment. Yamauchi Haku's foundation lies entirely in Japan. And Japan today is sick."

The assistant's eyes slowly lit up.

Yes, the executive director said before that the Japan market is no longer the most important!

As if remembering something, he quickly added, "By the way, Executive Director, there has indeed been some activity regarding the third-party developer recently."

"Oh?"

"Many large and medium-sized game companies have purchased Super Famicom development kits from Nintendo, even Bandai, in which we have already invested—but they informed us in advance." The assistant said this cautiously, afraid of offending the executive director.

Nakayama Takuya simply smiled, completely unconcerned. "Let them buy it. How will they know how well Sega has optimized the development for the Mega Drive if they don't experience the development difficulties of the Super Famicom themselves?"

This half-joking remark eased the assistant's tense nerves. He chuckled and said, "You're right. However, there are tough nuts to crack. On Square's side, President Miyamoto Masashi and Department Head Sakaguchi Hironobu are very resolute and haven't bothered with this at all."

"Hmm." Nakayama Takuya nodded in satisfaction. "I didn't misjudge you."

A single sentence is worth more than a thousand words of praise.

Sega has finally found a staunch ally.

"I still don't understand," the assistant scratched his head, genuinely perplexed. "Nintendo clearly has all the advantages, so why do they act so superior when it comes to development kits? I've heard that getting one from them now is not only ridiculously expensive, but you also need connections and seniority—it's like praying to a god."

"Because in Yamauchi Hiroshi's Kyoto, he's a god." Nakayama Takuya picked up his teacup and blew on the steam. "For decades, everyone has worshipped him; he's used to it. He doesn't need to win over developers; he only needs them to be loyal to him."

The assistant was completely stunned.

"But we--"

"We're different." Nakayama Takuya put down his teacup and looked at him. "We crawled out of hell, and we know how precious every ally willing to fight alongside us is. Remember our development machine policy?"

The assistant immediately straightened his back and recited, "Yes! Any game company whose past titles have sold over 10,000 copies can apply to Sega for a Mega Drive or GamePocket development kit. The first one, we'll give away for free!"

"The only condition is that they produce their first game within eighteen months, or we will take back the development kit."

"Anything else?" Nakayama Takuya pressed.

"And another thing!" The assistant's eyes lit up even more. "As per your instructions, for those veterans who joined our ranks before the large-scale defection of third parties, Konami has fully refunded the money they paid for their first development machine, offsetting the royalty fee!"

He couldn't help but laugh as he said this, "Executive, you didn't see it. Konami's Finance Department personally called, stammering, and asked three times if we had made a mistake in the accounts. He probably's never seen anyone voluntarily refund money in their life."

A light laugh rang out in the office.

Nakayama Takuya leaned back in his chair, his fingers tapping lightly on the armrest, enjoying the rare moment of relaxation.

He knew perfectly well that Yamauchi Haku wasn't unaware of the importance of appeasement, but rather simply disdained to do so.

In the world of that old man in Kyoto, there were only rulers and the ruled.

The third party is just someone who carries the sedan chair for him; whether the sedan chair is stable or not depends entirely on how hard the whip in the hand of the person carrying the sedan chair is.

Whether carrying the sedan chair was tiring or whether he wanted to take a different route was never a question he needed to consider.

This arrogance, ingrained in its very being, is what made Nintendo a dominant force, but it will also become its greatest Achilles' heel.

Of course, this matter cannot be entirely Yamauchi Hiroshi.

Looking across Japan as a whole, how many business leaders can break out of this circle?

They all want to treat their partners like servants and their employees like consumables, trying to make every last Japanese yen at every stage, otherwise it's like the business has lost money.

A grand scheme? It doesn't exist.

Nakayama Takuya could even imagine that if this had happened at Sega in the past, let alone voluntarily refunding the money, even discounts on each royalty would probably have required Nakayama Atsuo.