Before Nintendo was established, a Japanese card game called Hanafuda was already around. The flower-themed card game was closely associated with gambling and organized crime. Unlike the playing cards the West is familiar with, Hanafuda cards were small and thick.
A deck consisted of twelve suits with a flower representing each one. Japan banned gambling in 1882, but tolerated Hanafuda as the cards didn’t have numbers or designations of value. The Yakuza, a criminal group, set up Hanafuda parlors to entice gamblers.
Nintendo’s first product
Nintendo’s early history and journey are not ordinary ones. Its first product was the hand-painted Hanafuda playing cards. They were launched in 1889 in Kyoto, Japan. Many other companies had stopped making Hanafuda because of the associations with the Yakuza, but this didn’t stop Fusajiro Yamauchi, the founder of Nintendo Koppai.
In 1959, Nintendo secured a deal with Disney to print Disney characters on its cards. This helped to rebrand the company for families. The company experimented with various projects unsuccessfully before landing on electronic games. It was only in the 1970s that the shift towards electronics started taking place, and it pivoted to gaming under the leadership of Hiroshi Yamauchi.
Nintendo has a long history with gambling, from producing the hand-painted cards to approving casino games for their consoles. Bringing online casino games to consoles opened the hardware up to new audiences and further expanded entertainment options.
The Yakuza connection
When Nintendo started producing the Hanafuda cards, its headquarters were in an area of Kyoto associated with one of the oldest and most powerful branches of the Yakuza. The relationship between the two wasn’t official, but Nintendo’s cards were the premier choice for the Hanafuda parlors set up by the Yakuza organized crime syndicates. Nintendo could quickly grow its brand as it had many customers, an essential factor when starting a business.
Gunpei Yokoi, father of the Game Boy, was supposedly killed at the hands of the Yakuza. He would check the printing machines and inspect the cards to ensure they were uniform to prevent any kind of cheating. The Yakuza didn’t like his uprightness, and when his life ended in a freak car accident, conspiracy theories abounded.
The clean-up and ‘Operation Midnight’
By the 1960s, Nintendo had moved away from its association with gambling. However, when it launched the Super Famicom (SNES) in the late 1980s, yakuza-related interests were planning hijackings so they could profit from the black market. Nintendo ran ‘Operation Midnight’ to distribute the consoles late at night and ensure they reached legitimate retailers.
Today, Nintendo has strict compliance policies that prohibit partners from working with or providing benefits to anti-social forces. This is a common term in Japan for organized crime.
An innovative giant
Nintendo holds intellectual property that includes Pokémon, Mario, and Zelda. It offers these games exclusively on its devices, forming strong relationships with customers. Satoshi Tajiri created Pokémon, a game of collecting and trading creatures, which grew into one of the most influential pop culture franchises around the world.
Today, Nintendo is moving towards a more durable business model with account systems and digital subscriptions that create higher recurring revenue than hardware sales alone.
How Nintendo competes
When comparing Nintendo vs. Xbox vs. PlayStation, these are all good options that offer great gaming experiences.
The Nintendo Switch is the oldest of the three consoles. However, players can play some incredible games on it, such as The Legend of Zelda: Breath of the Wild. Over the years, there have been imitations of Nintendo’s games, such as Mario Kart, but few have come even close to the same quality.
Nintendo focuses on high-margin, family-friendly content, which is a core philosophy it has stuck to over the years. Despite its interesting origins with the connection to gambling, Nintendo’s success was rooted in its early ability to create products that were high in quality and in demand.
