The Mount Rushmore of Nintendo Part One: Hiroshi Yamauchi

There are many people who’ve made Nintendo the giant it is today. Join us as we take the next four weeks to dive into the lives of four people who left an indelible impact on one of the games industry’s largest corporations.

Hiroshi Yamauchi lived a complex life. Born in 1927 and abandoned at five years old by his father, Yamauchi grew up under the tutelage of his strict grandparents and rebelled under their intense pressure. [1] Handsome, bitter, and richly dressed, Yamauchi became the third president of Nintendo upon his grandfather’s death in 1949, assuming his role with a house-cleaning that saw every manager from his grandfather’s tenure fired and replaced. [2] Dissatisfied with the company’s role as a manufacturer of playing cards and traditional Japanese hanafuda cards, Yamauchi attempted to utilize Nintendo’s flow of capital toward other ventures, from instant rice to “love hotels,” before settling upon entry into the toy market. [3]

Starting in 1970, Yamauchi employed Gunpei Yokoi to come up with ideas for Nintendo to market. Yokoi’s first idea, the Ultra Hand, sold 1.2 million units, earning Nintendo roughly $6 (in 1970 dollars) per toy, an incredible margin for the emerging manufacturer. [4] From there, Yamauchi dabbled in several other projects (e.g. “love testers,” beam guns, and indoor lase clay ranges), before deciding to take Nintendo into the video games industry. It was there that Yamauchi made his mark, catapulting Nintendo into a household name

Naturally ruthless, with a taste for power and control, Yamauchi molded Nintendo into the force that it would become. He worked with Nintendo engineer Masayuki Uemura to create a cheap and affordable game console after the success of Color TV Game 6, Color TV Game 15, and the Game & Watch series of handhelds. [6] Strong-arming semiconductor manufacturer Ricoh to get rock-bottom prices on the system’s main CPU, the Ricoh 6502, Yamauchi put Nintendo in advantageous position once the system released in 1983, selling half-a-million units in the first two months alone. [7]

Enduring setbacks with the same ferocity with which he attacked opponents, Yamauchi made the tough, but correct, call in recalling all initially sold units when a previously undiscovered glitch was found within the Famicom’s integrated circuits. [8] Despite the image he projected at work, the anger he let out, and the fact that he didn’t even play video games, he read the market for games well, managing to select hit after hit for the Famicom in Japan. [9]

Domineering, cold, and calculating, Yamauchi’s family feared him nearly as much as his competitors did. His daughter, Yoko, hated him fiercely. She noted how he frequently forbade her from being out late at night and required a strict curfew. Yet, he was eerily acquainted with the geisha at bars and returned home late at night. His habitual philandering, while endured by his stoic wife, caused seething hatred in his daughter. [10]

As Nintendo’s position in the games market came under attack, Yamauchi made costly errors. First, he squeezed game publishers as tightly as he could. With 80% of the games market under Nintendo’s control in the early 90s, Yamauchi forced publishers into watertight agreements that curtailed several of their most deeply held rights. [11] This, in turn, bred resentment for Nintendo among game developers, who routinely looked for alternatives that were less strict in their requirements.

Secondly, he reversed a deal made with Sony to manufacture CD-based components for Nintendo’s consoles, choosing to go with Philips instead. Besides the ignominy of Nintendo’s IP on Philip’s CD-i, Yamauchi watched as Sony’s PlayStation dominated the market, trouncing Nintendo’s technically-superior but complex Nintendo 64 on its way to over 100 million units.

Finally, Yamauchi’s decision to position the GameCube as the more powerful competitor to Sony’s then-upcoming PlayStation 2 hurt the system appreciably. Throttled by the Xbox in North America and pummeled by the PlayStation worldwide, the GameCube was neither the most powerful nor the most versatile console on the market. Sandwiched between two giants, it did not survive, selling less than 22 million units worldwide.

Yet, despite these mistakes (and his flamboyant philandering), there is no doubt that Yamauchi had an enormous impact on Nintendo, helping to shape the Kyoto-based company’s fortunes as it gradually worked its way into the video game market. His relentless, dominating persona, so wearisome at both home and the office, was the catalyst that drove Nintendo to produce better games, create cheaper consoles, and innovate.

Without Hiroshi Yamauchi, there would be no Nintendo as we know it today.

For more information on the life of Hiroshi Yamauchi and other members of Nintendo’s early leadership, check out Game Over by David Sheff. You can find it on Amazon.

Footnotes:

[1] David Sheff, Game Over: How Nintendo Conquered The World (New York: Vintage, 2011), Locations 288-296.

[2] Ibid., Locations 321-336.

[3] Ibid., Locations 344-352.

[4] Ibid., Location 384.

[5] Ibid., Location 392-458.

[6] Ibid., Location 474.

[7] Ibid., Location 521, 538-546, 594.

[8] Ibid., Location 602.

[9] Ibid., Location 649.

[10] Ibid., Location 1356-1364.

[11] “Wham! Zap! You just made a million,” The Economist, August 18, 1990, 60; Dominic Arsenault, Super Power, Spoony Bards, and Silverware: The Super Nintendo Entertainment System (Cambridge: MIT Press, 2017), 33-34.

PART 1 | PART 2 | PART 3 | PART 4