Nintendo and Sony's Agreement
"And then there's profit sharing," Howard Lincoln, standing next to Minoru Arakawa, added, his tone as if discussing the weather. "Nintendo takes the lion's share of all royalties and publishing profits generated from Super Famicom cartridge games. As for the meager profits from your CD-ROM drive, Sony can keep that."
This is practically treating Sony as Nintendo's contract manufacturer and a free hardware R&D department.
The Sony representative wanted to slam his fist on the table, throw the stack of documents at Minoru Arakawa's face, and yell, "Fuck you!"
But they cannot.
Norio Ohga's bottom line was: preserve the flame.
As long as the name "PlayStation" still exists, and as long as the console can be released, we'll swallow this bitter pill, even if we have to kneel down.
The pen scratched across the paper, making a sickeningly sharp sound.
Minoru Arakawa watched the other person sign their name, then finally picked up his coffee, which had long since gone cold, and took a sip.
Bitter, but with a sweet aftertaste.
That evening, an overseas call came into Nintendo Headquarters in Kyoto.
"President, it's all done."
Minoru Arakawa stood in front of the floor-to-ceiling window, looking at the dazzling night view of Chicago, his tone exuding an air of complete confidence.
"Sony has kept its name, but lost its soul. They're just helping us sell cartridges now. That machine will become the best accessory for the Super Famicom, and we won't need to spend a single penny on hardware development."
On the other end of the phone, Yamauchi Hiroshi remained silent for a long time.
This tyrant who has been at the helm of Nintendo for half a century seems to be weighing the pros and cons.
Even if you let a wolf into your house to guard it, and it has its teeth pulled and is chained up, a wolf is still a wolf.
"Indeed," came Yamauchi Hiroshi's aged yet authoritative voice, "Don't underestimate the power of resentment. But since we've signed, let them do what they want. As long as we retain control of the cassette tapes, they can't cause any trouble."
After hanging up the phone, Minoru Arakawa loosened his tie.
In his view, the crisis had been perfectly resolved.
Sony invested heavily in research and development, but ultimately only managed to create a deformed "Frankenstein".
A freak with Nintendo cartridges inserted and Sony blood flowing through its veins.
Sony Headquarters, Shinagawa Ward, Tokyo.
A strong smell of tobacco filled the air.
In the center of the table sat the prototype exhibited at CES—a "freak" with the Sony logo on the bottom but Super Nintendo cartridge slot on the top.
"Take it away." Norio Ohga frowned in disgust, tapping his cigar heavily against the rim of the ashtray twice. "Looking at this thing reminds me of Minoru Arakawa's face."
Without saying a word, Ken Kutaragi unplugged the power and tossed the prototype onto the sofa in the corner like trash.
"That slot is our pillar of shame." Ken Kutaragi turned around, his voice hoarse, clearly having barely slept for days. "As long as we keep this cartridge slot, we have to be compatible with Nintendo's old system. They control the cartridge production rights, the royalties, and even the game censorship."
He walked up to the whiteboard and forcefully drew a huge X.
"If we continue with this approach, no matter how well the machines sell, Sony will just be a high-end OEM for Nintendo. For every machine sold, we earn the hard-earned money from the hardware, while Nintendo reaps the huge profits from the software."
"This is handing bullets to the enemy," Nobuyuki Idei added coldly from the side.
Norio Ohga exhaled a puff of smoke, his gaze sharp. "What did the legal department say? About that name?"
Since we've already torn off relations, let's tear them off completely.
Nintendo's lawsuit against Sony in Chicago for infringing on the "PIayStation" trademark is indeed a ruthless and decisive move.
A Legal Department manager stood up nervously, clutching a thick document in his hand.
"President, we've checked with the trademark offices in United States and Japan."
Nintendo does indeed have the right to use the phrase "PlayStation"—note the space between the two words—based on a previous cooperation agreement.
95
"So we even have to change our names?" someone muttered in dissatisfaction.
"No." The legal manager pushed up his glasses, a sly glint in his eyes. "Trademark law is very rigid."
"Station" is a combination of two generic words, meaning a game's workstation. But what if we remove the space in between?
He picked up Mark, wrote two words on the whiteboard, and then forcefully joined them together.
PlayStation.
"This is a neologism," the legal director's voice rose a few decibels. "It's not in the dictionary. It's a completely new proper noun, a brand unique to Sony. Nintendo's agreement governs Play..."
"Station has no control over PlayStation."
There was a two-second silence in the conference room, followed by a few suppressed chuckles.
This is simply a word game, but in the battlefield of commercial law, this kind of rogue word game is often the most effective.
"Very good." Norio Ohga finally showed his first smile since returning to Japan, though it was tinged with a hint of ferocity. "Remove the spaces. Tell the whole world that the PlayStation that used to work for Nintendo is dead. What lives now is Sony's PlayStation."
With the name resolved, the most crucial issue remaining is the hardware.
Ken Kutaragi walked back to the table, placed his hands on the surface, and burned with a fanatical light in his bloodshot eyes.
"Now that the name has been changed, the machine's soul must also be replaced."
"President Ohga, I want to completely remove the SFC's cartridge slot."
Upon hearing this, many conservative executives in the conference room gasped in shock.
"Kutaragi! Are you crazy?" A director couldn't help but stand up. "Without Nintendo's cartridge compatibility, what are we going to use for launch titles? Mario, Zelda —all those resources will become worthless!"
"Those are games from the last era!" Ken Kutaragi retorted bluntly. "Cartridges only have a few megabytes of capacity; that's a product of the past! What we need to create is a future that only CD-ROMs can hold! Look at Sega with the Sega-CD..."
The game quality showcased in Chrono Trigger! Players say that's the next generation of games, while that was just an upgrade based on the Mega Drive.
He pulled a stack of new design drawings from his briefcase and slammed them onto the table.
"Furthermore, since it's incompatible, we no longer need to cater to Nintendo's pitiful 16-bit architecture. I'm going to upgrade our console to 32-bit. I want this machine's performance to leave Nintendo and Sega's current toys a whole era behind!"
"If we continue to carry the burdens of Nintendo's past, we will never run fast."
The smoke in the conference room seemed thicker than before.