Bill Gates Wanted to Buy Nintendo

The world has changed a lot since the dawn of the century. Reality TV is a thing now, the world is in recession thanks to a handful of ridiculous wars and greedy bankers, and Australia “voted” in a female Prime Minister.

But these pale in comparison to a potential change that would’ve shifted everything we know about this planet; Microsoft’s aquisition of Nintendo.

Back in 2004, Bill Gates was still at the helm of Microsoft. The new Xbox console had only been on the market for a couple of years, and Nintendo’s GameCube was a solid, but quiet impact on the video game industry. Xbox was revered for it’s powerful looking games and, more importantly, it’s online functions – but what it lacked was an identity.

Nintendo GameCube, on the other hand, was a console known for it’s strong marketability, despite how Nintendo handled that potential. All the gaming icons of old were there, rendered for the first time in stunning, crystal clear graphics: Mario, Samus, Link, Pikachu; these guys can sell units.

Speculation of a Nintendo buy-out was rife, as it is today. Despite Nintendo’s ability to make itself look bad in the financial sector, the fact remains that it sits on a huge pile of cash. Today, it’s over $10 Billion – back in 2004, it was roughly half that. Still, buying a company with a huge pile of cash is a good move; you can get a bank loan to raise the funds to buy the company, and then once it becomes yours, use the acquired company to pay back your loan. Profit.

And since GameCube wasn’t exactly the most popular console back then (PlayStation 2 was tearing up the charts), many assumed the company was “going down” and a buy-out was inevitable. Another factor is the company’s president, Hiroshi Yamauchi, had retired in 2002 after running the family business for over 50 years, taking 10% of the company with him. To this day, Yamauchi is Nintendo’s largest shareholder.

But perhaps the biggest threat to a hostile takeover of Nintendo was Bill Gates’ remarks at a private cocktail party in Germany. Like most billionaires often do, Gates was entertaining a small but incredibly rich group of friends at a social function, where he quipped the line “When Hiroshi Yamauchi calls, he will get me on the phone immediately.”.

The tabloids exploded. Nintendo’s shares shot up 5 percent, and Microsoft went into lockdown. The press bombarded the firm with questions and while some PR reps used the “it was taken out of context” defence, eventually Microsoft instructed it’s staff to invent the now immortal line; “Microsoft does not comment on speculation or rumour”, which has been the calling card for many companies ever since.

Even analysts got into a spin; many said it “made sense” and that Nintendo would benefit from Microsoft owning a large stake in the company. Others, admittedly, thought it was a load of rubbish but the fact remained; Bill Gates said it.

The story of a potential aquisition was so big, it hit worldwide headlines. The story spread from Germany to the New York Times, showed up in all kinds of financial papers, hit the gaming media on sites like IGN and GamesIndustry, and even showed up on Australian news broadcasts.

Alas, it wasn’t to be. It turned out that Gates was just trying to be friendly, making a half-serious joke about how his company is making a massive impact on the gaming industry. It must be nice to be that well off that you can laugh about buying a multi-billion dollar company and actually have people take you seriously.

What would the world be like had Gates been serious all those moons ago? Would motion gaming still exist? Would we still have titles like Pikmin or, for that matter, Halo? Would Microsoft use Nintendo to run their whole gaming sector, or would the company just be absorbed? It’s an interesting thought – share yours in the comments below!

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  • http://twitter.com/KnucklesSonic8 KnucklesSonic8

    “It must be nice to be that well off that you can laugh about buying a multi-billion dollar company and actually have people take you seriously.”

    Ha ha. I like that.

    Nice article! Wasn’t aware this ever occurred.

  • mario vendetta

    clayton christensons scheme of cheap hardware only works once. reggie fil-aimes will run nintendo so down, that a common paserby could grip a whole lotta stocks, if even anyone wants em. Any lower nintendo will be back to making playing cards.

  • cbarroso09

    Nintendo is sold and stop being Nintendo

  • http://www.facebook.com/JPW83 Jpro Walkom

    It’s amazing how bad people are at the mentality. They think just because you’re having a bad hair day, you’re ready to be bought out. If that’s the case why hasn’t Microsoft bought EA out yet?

    Back then, yeah Nintendo wasn’t making much money from the gamecube, they were in a world of hurt, but they weren’t broke. They had the gameboy at the time they had Pokemon and they were doing fine.

    Nintendo will always have money from us. They will never go fully broke. It’s not like Sega where they screwed up the Saturn, ran their mascot and company into the ground, and then screwed up the Dreamcast.

    All Nintendo needs to survive are 4 franchises. Mario, Zelda, Pokemon, Smash Bros., they release any one of these games and it practically sells a million like that! Boom! There’s our financial crisis saved!

    As long as they have those 4 they’ll never lose their game. I’m not being fanboyish, i’m not being naive. IT IS A FACT!. DS Lite gets a rough start. They release a Pokemon game. Boom. Sells a million overnight. becomes the highest selling handheld console. 3DS not a good start. Christmas rolls around Mario Kart 7 and Super Mario 3D Land. All of a sudden 3DS is flying off the shelves. Shops were out of stock at christmas. Skyward Sword brought the Wii back to life. If only for the Christmas period.