Here�s a good example of this: Why does Nintendo simply refuse to make standard CD-based games and systems? There are tons of reasons for this, some less obvious than others. Nintendo has had an issue with allowing people to "steal" their games/money since the late 80�s. They filed multiple lawsuits against video-rental stores, trying to make it illegal to rent games. They�ve had different lock-out chips in their systems and games since 1985, which allows nobody but Nintendo licensees to make games on their systems.
Another reason is their deep-seated spite for Sony, who made their own CD-ROM games mainstream. Some know that Sony and Nintendo originally had plans to make a game system together, ironically called the "Sony Playstation." Sony would make the system, which would have a CD-ROM that played Sony�s games, called "Super Discs," and it would also have a SNES port on it. It sounded great: two Japanese companies, giants in there own respective industries, joining forces. But Nintendo, led by the insanely-proud Hiroshi Yamauchi, knew that this was Sony�s way of crippling Nintendo. It was perfect: they would become the sole worldwide licenser of their Super Discs, they could win Nintendo�s customers, steal licenses from them, and then discard the company. They were also the sole supplier of the SNES�s audio chip, and the chip could only be used to it�s full extent by an expensive programming tool that only Sony had. Obviously, Yamauchi would not stand for this. As one industry consultant put it, "Sony had Nintendo by the balls�" He soon instructed the president of NOA (Nintendo of America) to go ahead with "The Philips Deal." The deal gave Philips, Sony�s tech-rivals, the right to make Nintendo games for their failing CD-I system.
Publicly, Yamauchi said that the deal was made because Philip�s CD-ROM technology was superior to Sony�s. Privately, it was known that Yamauchi had allied with Philips because Nintendo would not become dependent on any other company. No one, not even Sony, intimidated him. When Sony learned of this, they were stunned. Threats of lawsuits flew about, pressure was put on Nintendo, then Philips, but in the end, Nintendo stuck with their plan, and as a Sony executive put it, "They stabbed us in the back." The shockwaves would be devastating. They had humiliated Sony (creating a new enemy), and had breached the unwritten law of turning against a reigning Japanese company in favor of a foreign competitor. This story is one of the bigger examples of how Nintendo is a proud, stubborn company, who ONLY goes to the beat of their own drum. Sony is now the reigning giant of video-game systems, and Nintendo may never fully overthrow them.
Can you blame Hiroshi Yamauchi for his decisions at the time? Nintendo was still huge. The Super Nintendo reigned supreme, but the empire was slowing crumbling under the weight of burnt bridges, bitter enemies, stinging lawsuits, and Sega. Eventually, the industry changed. Competitors changed. Gamers changed. Nintendo stayed the same. Sega fell to it�s knees. Microsoft took up the challenge. Atari became a faded memory of college students. But throughout it all, Nintendo stayed the same. Maybe it�s good that Sony and Nintendo went their separate ways. Competition makes people work harder. This has certainly became the case. Japan now prefers Sony over Nintendo. Hardcore Americans prefer Xbox, but Sony is still mainstream. Some things will never change though. Most adults know video games in general as, "Nintendo games," like Kleenex to tissues. Those Atari college students make fun of Mario�s water gun, and Link�s new look, but still come flocking back for the new Metroid. Some things never change, and some never should.
So, what went wrong with Nintendo? Nothing. Nothing went wrong; they just never changed. As the world turned clockwise, Nintendo went counter-clockwise. Why? Because they could "back in the day," and they�re not quite ready to move on yet. Look out though, because Nintendo CAN�T continue to sit back and watch as their world falls down around them. Something has to happen. Something has to give. I just hope that what gives isn�t Nintendo.