Nintendo just released a trailer for its next generation console, which now finally has a name: The Nintendo Switch.

After the phenomenal success of the Wii, Nintendo still has around $10 billion of cash reserves in the bank. However, their failure to convince customers of the capabilities and values of their follow-up system, the WiiU, led to that system being a bit of a flop.

The Nintendo switch, highlighted in this new trailer released above, appears to be a change in direction for the company, focusing more on hardware quality, gameplay and individual gaming than the family-friendly atmosphere of previous generations.

Here are a couple of things we can determine about not only the hardware, but also the innovation route which Nintendo is targeting:

  1. The console, as long rumored by leaked specs sheet in previous months, consists of a tablet-style gaming unit with two detachable controllers either side of it. These controllers can be used  while connected to or seperated from the device, and appear to have movement-sensing capabilities similar to those in the Nintendo Wii. These controllers are allegedly called “Joy Con” according to the Verge.
  2. The screen can also be used in a multiplayer mode, with several people each using a single controller while sharing a single screen or multiple screens.
  3. The system will be powered by a custom graphics system by Nvidia, based on the Tegra X2 architecture. Exact performance expectations have not been outlined, but some industry analysis suggest the chip may be capable of graphics more powerful than a Playstation 3, but less than a Playstation 4. It is also possible that performance may be different when the unit is plugged into its base station and connected to a large TV for higher resolutions, compared to more battery-efficient lower resolutions while operating off a battery.
  4. Games for the system will be loaded onto custom cartridges, like with older Nintendo mobile systems. No news yet on whether games will also be downloadable.
  5. Nintendo appears to have a very specific target market in mind here as shown in the video: Young adults. Whether they are on the sofa, going to a rooftop bar or playing basketball, they show their users as being in their 20s or so. This is important to note as it gives us some insights into their target market, which could be gadget-hungry millenials who want to stay at the forefront of technology, and this might also indicate that the price of the system, which looks significantly more high-end and component-heavy than Nintendo’s previous consoles, will also be much more expensive than their previous systems. This is a distinct shift in their innovation strategy compared to previous console generations.
  6. Nintendo also likely learned a lesson about this from the failure of the WiiU compared to the original Wii. While the Wii appealed families due to its simplicity and low price, Nintendo quickly found out that these same consumers were less likely to upgrade to a newer version of the system, resulting in the terrible sales of the WiiU. Nintendo is likely therefore shifting its focus away from families (where the market may already be more saturated), and towards gadget-hungry individuals again.

If you want my take on it, I think the system will sink or swim depending on the hardware cost to Nintendo and therefore the system’s profitability. If they are lucky, the demand for smartphone processors will quickly help drive down the cost of their Nvidia chips, but this is still to be seen.

The greater challenge is in convincing the customers of the value of all these new innovations. Gamers nowadays are split more distinctly between core gamers who want a powerful system at home (Playstation 4, Xbox One or PC), or mobile games which they play on their smartphones. Nintendo may end up finding itself in no-man’s land between these two camps, with a home console that can’t compete with the established brands from Sony and Microsoft, and mobile gamers who are happy enough with their phone’s performance that they wouldn’t consider an additional large tablet to carry around.

But best of luck to them. I love Mario Kart and can’t wait to see what they do with the system.

This story will be updated as we get more details on this innovative new piece of technology, due to be released in March 2017.