Nintendo’s new boss has his work cut out for him


Nintendo has appointed a new president following the death of its former boss as the Japanese video games maker tackles the challenge of pushing into mobile and keeping its console sales strong.

Tatsumi Kimishima, the current head of human resources, will take on the new role from Wednesday after former president Satoru Iwata died of cancer in July.

Kimishima takes the reign of the Japanese gaming giant, known for its iconic Super Mario character, as the company tries to re-establish itself as a leading console brand in the face of stiff competition from Sony's PlayStation 4 and Microsoft's Xbox One, as well as mobile gaming.

"They are in a vulnerable position," Heloise Thomson, analyst at Enders Analysis, told CNBC by phone.

"From a brand perspective, they have a golden brand. But you can't survive off nostalgia and they haven't done enough in marketing in international markets to tell people what Nintendo is right now."

Mobile push

Nintendo has been struggling in the last couple of years but swung to a surprise profit in the three months to the end of June. The company has been on a big drive towards mobile gaming over the last few months, a path set out by Iwata and unlikely to be changed by Kimishima, analysts say.

Getty Images

In March, Nintendo struck a partnership with Japanese mobile gaming firm DeNA to produce titles for smartphones and tablets. And last week, Nintendo announced it was working on an augmented reality mobile Pokemon game as it looks to get its innovative edge back.

But at the same time, Nintendo will have to make sure that mobile gaming does not cannibalize its profitable hardware division – with consoles such as the Wii and 3Ds – which accounts for nearly 50 percent of sales. In order to do this, Nintendo will need to make games that are distinctively different on mobile than on its consoles, according to analysts.

"They cannot take a game that lives on the WiiU and port that over to mobile because they know that it will not be good gameplay and they don't want to cannibalize their software or hardware sales," Thomson said.

Temporary job?

Kimishima, 65, is a former banker and was head of Nintendo's U.S. operations from 2006 to 2013. He was chosen ahead of Genyo Takeda, and Shigeru Miyamoto, both directors at Nintendo, who were running the company after Iwata's death, to the top post.

How will Nintendo fare in 'tough' quarter?

With his background in finance and human resources, Kimishima appears to bring steady leadership to the top of Nintendo, but some analysts said that with his "traditional" background in banking, the promotion is temporary while the games giant looks for a more forward thinking leader.

"He will retire in one or two years. This might be a temporary position," Satoshi Tanaka, an analyst at Daiwa Securities, told CNBC by phone.

"Nintendo wants to push the company to mobile, he is not bad, but he is a very old type personality. His first job was at a bank, his way of thinking is still traditional. They need someone with a new way thinking."