Credit: Shutterstock photoIn September 2016, Super Mario decided to go down a tube in Japan and wind up on an iPhone in Cupertino, California.
Now, both the beloved plumber with the red hat and overalls and the iconic smartphone maker are poised to have record setting sales this holiday season. But there's more to this relationship than meets the eye.
Two companies, worlds apart, have never had their futures more intertwined than they are now, as Nintendo and Apple (AAPL) are now venerably linked at the hip -- or chip, I should say.
Since Nintendo announced Super Mario Run would be coming to the iPhone in December, more than 20 million people have signed up for notifications when the game will be announced. That number seems likely to grow as the game gets closer to launch and Nintendo actually announces the launch date and pricing.
Apple, for owning the App Store, will get its custom 30% cut of whatever revenue is generated from the game. Assuming no growth from that 20 million figure -- which is hard to believe -- and an average revenue per user (ARPU) of $10 from the game, Nintendo stands to make $170 million in revenue and Apple $30 million -- not huge amounts for either company, but not exactly nothing, either.
Given the success of Pokemon Go, which has been downloaded more than 500 million times, it's a good bet that a character as popular as Mario is likely to be downloaded significantly more than 20 million times from a user base of over 1 billion devices.
In addition, Nintendo is also likely to benefit from the increase buzz around the company because of Pokemon Go, Super Mario Run and its latest console, the Nintendo Switch. The announcement of Nintendo Classic Edition was met with considerable excitement earlier this year and reviews of the system have been nothing short of astounding.
For $60, people can relive their childhood and play 30 classic games such as the Super Mario Bros. series, Donkey Kong, TecmoBowl and a host of others. Gizmodo called it "a great gift" and said unboxing it almost made the author cry.
For Apple's sake, the iPhone 7 and 7 Plus have been more well received than anyone in the media and on Wall Street anticipated. This goes back to brand cache, something both Apple and Nintendo have in spades.
Apple refreshed nearly its entire product line in the past few months, from the iPhone to the iPad to the MacBook Pro. Apple's legions of fans, despite some harsh criticism surrounding the new MacBook Pro laptops, have been buying its products faster than Apple and its partners can make them.
A look on Apple's website shows the new MacBook Pros with Touch Bar and TouchID have longer than usual shipping dates. The iPhone 7 Plus in Jet Black, which seems to be the most desirable of the new lot, still has a shipping date of 3-5 weeks nearly two months after it announced.
That's a good sign for a company that has struggled to grow revenue in recent quarters.
Both companies have a history of secretiveness and have been around and more importantly, relevant, for nearly 40 years in technology -- a feat that isn't easily done. Both have reinvented themselves multiple times, have had iconic figure heads and are beloved by millions.
With the two companies working relationship seemingly getting closer than ever, it's not hard to see why as the fortune of one company goes, the other may follow.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
