We’re back again with another collection of book notes. I’ll be cranking these out as I continue doing the research for “The Internet is Magic”, which is the follow-up to “Social Media is Bullshit”. There are roughly 200 books (111 on the Kindle and about 86, and counting, in print) that I’m working on.

Speaking of “Social Media is Bullshit”  …

If you like what I’m doing here with these book notes and podcast, I have a specific ask: I encourage you to buy a USED copy of Social Media is Bullshit and do one of the following:

1. Read it and keep it.
2. Read it and donate to your local library.
3. Read it and share with a friend.

None of the above should cost you more than $10 if you get it through Amazon USED.

Cool?

Standard disclaimer: These are my notes. There are probably typos and spelling errors as these are not meant to be a finished product. I didn’t even bother to put this all in AP style. My goal right now is to read as many of these 200 books as I can, do the summaries, and keep rolling so I can get to the book proposal stage by May. So, time is short. Pardon the lack of formatting.

Also: I use MBAs to describe not just people with the degree, but people who are generally shortsighted and obsessed with data. I’m sure there’s a better term for this, but I have yet to settle on one.

The Console Wars Or How Sega of Japan Ruined Everything

This is the first (of the 111) Kindle books that I’ve worked through. Copy and pasting my notes out of Kindle.Amazon.com was convenient, but I much prefer writing in the margins of print books and dog ear pages that I found useful. The other downside to importing notes from the Kindle? I can’t give you the exact page I pulled this content from, instead I just have the location number. I know it’s sort of the same, but also super fucking annoying.

Also: If you’re looking for a modern analog between Sega vs. Nintendo from the ’90s, look no further than T-Mobile vs. AT&T (and Verizon). MANY of T-Mobile’s tactics today completely mirror the upstart Sega’s tactics used against Nintendo back then.

On to the notes …

–“Between Barbie, He-Man, and everything in between, people would say that Kalinske had the “magic touch.” He liked when people said it, even though he knew it wasn’t true. There was no such thing as a magic touch, and it wouldn’t have mattered if there were, because the only thing it takes to sell toys, vitamins, or magazines is the power of story. That was the secret. That was the whole trick: to recognize that the world is nothing but chaos, and the only thing holding it (and us) together are stories. And Kalinske realized this in a way that only people who have been there and done that possibly can: that when you tell memorable, universal, intricate, and heartbreaking stories, anything is possible.”(Location 604)

This is something I’m always advocating, but it’s hard for people to wrap their head around, particularly if they’re of the MBA / obsessed variety. You know why most startups fail? They always complain, “We ran out of money. We didn’t have the right team. The market conditions were bad.” Meanwhile, (most) startups and tech companies I encounter have an absolute disdain for marketing and marketing people, and THAT is why I think most of them fail. The other shit? It’s all excuses. None of them know how to tell good stories and make themselves stand out, they don’t get (or want to get) branding and the importance of PR, and so they lean on the same set of stupid tricks (see: “Growth Hacking” and other bullshit surrounding Lean Startup methodology), and then complain when they don’t get anywhere.

McDonalds, through Ray Kroc, had the story concept nailed. So did Sega. The thing that killed both companies, or in McDonald’s case, grossly harmed them, was what happens to most successful companies after a while: They let the MBAs and Shareholders start making the decisions, or they let corporate people make bad decisions for petty reasons (Sega of Japan basically destroyed Sega as we know it because they felt inferior to Sega of America’s success).

But those problems come later. If you can’t get your story right, you’ll never get to that point anyway. Or in the case of a lot of startups, you’ll just never get out of the gate.

–“Kalinske nodded, returning to the moment. But before the girl could fix him a drink, she suddenly became transfixed by the Game Gear and, as with the well-dressed man, the world suddenly shrunk around her. Well, would you look at that, Kalinske mused, while having a revelation that would shape Sega, the videogame industry, and the face of entertainment as a whole. Videogames weren’t just for kids; they were for anyone who wanted to feel like a kid. Anyone who missed the freedom and innocence that comes with endless wonder. Videogames were for everyone; they just didn’t realize it yet.(Location 611)

Related to the above: Walmart, Starbucks, Sega, McDonalds, Uber, Airbnb, Facebook, Apple, what do they all have in common? They wanted everyone. So this whole “You gotta focus on a niche audience” thing is stupid to me. Customers personas can be helpful, so can data, but too often both of those things are used to stuff outreach campaigns into very small buckets, and those buckets don’t fit everyone who may be a potential customer of yours. Why? Again: We let the MBAs take over, and all that’s done is make us all risk averse and data obsessed in our decision making.

And it’s not just the MBAs. Startups in particular are fanatical about targeting a narrowly defined customer because they can quantify that and feel better about themselves in the process. All the while, ignoring everything else that’s out there.

The lesson here for you is to just swing for the fucking fences. If you’re going to go broke anyway, you might as well go broke taking your best shot at it.

–“Finally there was a respite to the chaos when the verbal daggers were momentarily replaced with collective giggles. “Sgt. Kabukiman,” Sega’s director of licensing, Diane Drosnes, repeated over laughter, “Yup, that’s right, he’s back.” Sgt. Kabukiman N.Y.P.D. was a 1990 comedy about a clumsy New York cop-turned-superhero with powers like heat-seaking chopsticks and fatal sushi. Only a few Sega employees had actually seen the movie, but those who had all agreed it had to be among the worst ever made. Yet despite its seemingly obvious horridness, Sega’s game developers in Tokyo thought it was a wonderful film and the Americans needed to obtain the license to make a game based on it. Every month, Drosnes and her colleagues would send faxes explaining why this was a bad idea. But without fail, the suggestion kept coming back from Japan. This perpetual cultural difference was a source of great levity, but after everyone had a quick laugh the bickering resumed in full force.” (Location 690)

I had to look this up. The movie is real. There is no fucking way this movie would get made today. Thank you, the ’90s.

–“On September 23, 1889, just weeks before his thirtieth birthday, an entrepreneur named Fusajiro Yamauchi opened a small, rickety-looking shop in the heart of Kyoto. To attract the attention of passing rickshaws and wealthy denizens, he inscribed the name of his new enterprise on the storefront window: Nintendo, which had been selected by combining the kanji characters nin, ten, and do. Taken together, they meant roughly “leave luck to heaven”—though, like most successful entrepreneurs, Yamauchi found success by making his own luck.” (Location 742)

I included this note here because I read a lot of Geek Culture websites. And every so often you see one of those “Nintendo is DYING” posts popup, and my response is always, “No stupid, Nintendo has been around since 1889. The odds are good that, in one form or another, they will outlive both you and your media outlet.

–“In an era where most businessmen were content to survive off the modest returns of regional mainstays such as sake, silk, and tea, he decided it was time to try something new. So instead of selling a conventional product, Fusajiro Yamauchi opted for a controversial one, a product that the Japanese government had legalized only five years earlier: playing cards.” (Location 746)

Huh. Look at that. In 1889, someone decided to try something new instead of doing what everyone else was doing. Sure seems like there’s something we can learn from there.  😉

–This task was given to Shigeru Miyamoto, a floppy-haired first-time game designer who idealistically believed that videogames should be treated with the same respect given to books, movies, and television shows.(Location 862)

I included this here because, back in 2010, Roger Ebert went and pissed everyone off by declaring that video games are not art. He’s dead now (sadly) and it seems like as a culture we’ve move past this silly debate, but … Here’s what I think is a good answer to that question:

–“His efforts to elevate the art form were immediately given a boost when he was informed that Nintendo was close to finalizing a licensing deal with King Features, enabling him to develop his game around the popular cartoon series Popeye the Sailor Man. Using those characters, he began crafting a game where Popeye must rescue his beloved Olive Oyl by hopping over obstacles tossed in his way by his obese archenemy, Bluto. (Location 863)

So, Donkey Kong was originally going to be a Popeye game. Can you imagine how different things would have been, not just for video games, but for Popeye, had that happened? Not to mention, my life growing up, since I was raised on a steady diet of Atari games. Including what eventually did get released as a Popeye game:

Man I used to play this thing all the time and always thought it was similar to Donkey Kong. Now I know why.

–“Through it all, Lincoln and Arakawa had forged an unshakable lifelong friendship. Which is why Lincoln was the first person Arakawa contacted when, in April 1982, MCA Universal sent a telex to NCL explaining that Nintendo had forty-eight hours to hand over all profits from Donkey Kong due to the game’s copyright infringement on their 1933 classic movie King Kong. (Location 888)

Thankfully, there seem to be fewer and fewer Patent Trolls out there today, but MCA Universal (now NBC Universal) provides here a classic example of a patent troll. How Nintendo beat them in court is fantastic …

“There was no doubt, of course, that they had made the movie, but Lincoln believed that they had failed to take the necessary measures to own what they thought they owned, and that the famous gorilla belonged to public domain. And in early 1983, when both parties revealed their cards, Judge Robert W. Sweet sided with Nintendo. He concluded that they had not infringed and, as Lincoln had predicted earlier, he awarded Nintendo over $1 million in legal fees and damages.” (Location 900)

Fun fact though: King Kong’s copyright status still remains hotly contested. Even with Skull Island about to hit theaters, there is yet another lawsuit in the works over issues of ownership in the Kong universe.

“Mystique, whose flair for pornographic titles was highlighted by their 1982 anticlassic Custer’s Revenge, which follows a naked cowboy on his quest to rape Native American women). (Location 912)
custers-revenge

Yup. This happened.

–The Famicom stumbled out of the gate but was soon rescued by heavy advertising consumer recognition that Nintendo had achieved a new echelon of gaming. (Location 922)

Wait, you mean advertising is good? All those tech people are telling me it’s dumb! I have to be lean and growth hack by my way to success by spamming people. What is this advertising shit? I can’t quantify that!

(Yes Virginia, advertising works. Stop fighting it because your friends from Silicon Valley, mostly fat with venture funding and well-connected people, are telling you it’s dumb.)

–Though Main lacked any videogame experience, his outsider mentality allowed him to look at the business not as an offshoot of the toy, arcade, or electronics industry but as something novel and spectacular. (Location 1039)

Above, I’m poking fun at tech people. This note helps to illustrate why. They all think the same, but here was someone at Nintendo who was an outsider, and that mentality turned out to be incredibly valuable for the company to have. You won’t find that in a lot of industries these days. I spent a year (in 2014) trying to quit being an author / consultant and work for an advertising agency or two in New York City. But I didn’t have an MBA and didn’t go to the “right” schools and get the “right” degree (Marketing, ect.). So I wasted a whole lot of time.

Now the industry is in a crisis where Brands are moving more toward doing their own advertising without the agencies, thanks in large part to the groupthink the ad industry suffers from. Can’t imagine why!

(But also: This goes double for tech, where people are obsessed with people with Ivy league degrees or who went to places like Stanford or MIT. And yet, so many tech companies fail. Hmmmmmmmm.)

–To spread this new gospel, he choreographed what he would later describe as Nintendo’s “storming of Normandy,” a full-out advertising, promotion, and distribution blitz that accompanied the rollout of the NES into stores nationwide. (Location 1040)

Not to beat a dead horse, but again … this is how Nintendo became “NINTENDO” the thing almost all of us owned in our homes or knew someone who did. It didn’t just happen magically.

–“Month after month, Nintendo of America grew stronger. They sold 2.3 million consoles in 1987 and 6.1 million in 1988. As staggering as these numbers were, sales of the hardware were nothing compared to the software: the company unloaded 10 million games in 1987, and 33 million more in 1988. With numbers like these, it didn’t take Main long to realize that, at the end of the day, it was the software that drove the hardware; the console was just the movie theater, but it was the movies that kept people coming back for more. This personal revelation led to a Hollywood-like title-driven business strategy, and his coining of the phrase “the name of the game is the game.”(Location 1046)

I LOVE “The name of the game is the game.” First, it’s true for a lot of products in the entertainment industry. But second, and more importantly, it emphasizes a focus on the quality of the product above everything else, and that’s something I don’t think any of us can lose sight of. If your product sucks, nothing you is going to matter over the long term. You might get people through the door at first, looking at you touring YouTube celebrities, but you’re not going to keep that audience once they figure out you and your product kind of suck.

–“Main’s approach to sales and marketing coincided with Arakawa’s overarching philosophy of “quality over quantity.” As Nintendo exploded, there were plenty of opportunities to make a quick buck (hardware upgrades, unnecessary peripherals), exploit the company’s beloved characters (movies, theme parks), or dilute the brand by trying to attract an audience older than Nintendo’s six-to-fourteen-year-olds. But these kinds of things didn’t interest Arakawa. He wasn’t driven by making money, at least not in the short term. What propelled him, what kept him up at night, was a desire to continually provide Nintendo’s customers with a unique and flawless user experience. As proof of this never-ending obsession, he set up a toll-free telephone line where Nintendo “Game Counselors” were available all day to help players get through difficult levels, and he initiated the Nintendo Fun Club, which sent a free newsletter to any customer who had sent in a warranty card.  (Location 1051)

So again, “The name of the game is the game”. This strategy, by the way, is ultimately why Nintendo outlasts Sega (when Sega of Japan starts rushing shit products with no support into the marketplace like the Sega CD, 32X, and the Saturn.) Nintendo stayed the course and focused on great games like Mario Kart, Star Fox and Donkey Kong Country. I can tell you, growing up, I had both the Genesis and the SNES and the SNES was almost always the one that got used because the Genesis had few games that were great. There were some (Sonic, Streets of Rage, Mutant League Football), but nowhere near what Nintendo had available.

One of the more frustrating things I’ve encountered since 2012 in the Tech world is the complete and total lack of attention given to the customer. Any time it’s mentioned doing something like Nintendo did here, you get greeted with this “That doesn’t scale” shit from the MBAs and other shortsighted people who only think in terms of metrics they can quantify now, not later. As Ray Kroc pointed out, he didn’t have that worry while growing McDonalds. He knew he’d make the money he put into advertising and customer service from good word of mouth.

Oh, sorry, we can’t quantify that!

–To build the brand, White courted Fortune 500 companies, resulting in pivotal promotions, like Pepsi placing a Nintendo ad on over 2 billion cans of soda and Tide featuring Mario on the detergent maker’s giant in-store displays. His coup came with the release of Super Mario 3, when he negotiated for McDonald’s to not only make a Mario-themed Happy Meal but also produce a series of commercials centered around the game.(Location 1081)

In the book I ghostwrote, one thing I found was that a lot of the multi-billion dollar tech companies got to where they are because of PR, good connections, lots of venture funding (allowing them to fuck up and transition to another business model), and strategic alliances. So here we see Nintendo doing the same thing to grow, and Sega later would do the same by teaming with celebrity athletes to promote Sega Sports. (Later: Nickelodeon, McDonalds with Sonic as a happy meal toy, and software developer Tengen as well.)

The name of the game might be the game, but if nobody knows that game exists? It won’t matter.

–After earning Arakawa’s trust as a tastemaker, he would scour the arcade scene and write detailed assessments that would go to Japan. Sometimes his advice was implemented, sometimes it was ignored, but in the best-case scenarios he would find something hot, such as the 1982 hit Joust, alert Japan’s R&D to it, and watch it result in a similar Nintendo title—in this case a 1983 Joust-like game called Mario Bros.(Location 1109)

Steve Jobs (stop laughing, I know it’s a cliche to quote him) once claimed Pablo Picasso once said “Good artists copy; great artists steal”.  Here’s the funny thing: Picasso probably never said that. We’re not sure who said it. That just makes the quote hilarious to me.

More importantly though, the FIRST Mario game turned out to be a ripoff of another game. That’s wonderful because not only does it support that quote, it’s also something you see all the time in the tech world. Everything is a copy or inversion of something someone else is doing. Part of that is because of the groupthink and fear based decision making the MBA types make, but another is that it’s not a bad idea if you can do something better.

We wouldn’t have Mario beyond a red pixelated blotch named Jumpman (from Donkey Kong) without this.

–Maybe Nintendo really did know best, but if there was one thing Kalinske had learned about consumers throughout his career, it was this: the only thing they valued more than making the right decision was making their own decision. So if Nintendo represented control, Sega would represent freedom, and this cornerstone of choice would be the foundation of Kalinske’s plan to reboot, rebuild, and rebrand Sega. (Location 1197)

This was something discussed in the Ries and Trout book. Essentially, to define yourself in opposition to the lead competitor in the category. (Law #9, the Law of the Opposite.)

Also:

–“You have to hand it to Nintendo,” Schroeder said, finishing the article. “Like them or not, everything those guys touch turns to gold.” “You’re right,” Kalinske replied, turning on the coffee machine. “So I guess we’ll just have to make sure everything we touch turns to silver. And, you know, while we’re doing that, we’ll find a way to convince the world that silver is more valuable than gold.” (Location 1202)

–“Sega did a good job of positioning themselves as the offbeat alternative to Nintendo’s autocratic reign, but that alone didn’t make their booth spectacular. Any mutt trying to out-bark the top dog would have done the same. What Sega did that no other company would have dared to do was acknowledge that it was a dog-eat-dog world. At the heart of their booth was a television displaying highlights from Super Mario World. Directly below it was a television showing off Sonic The Hedgehog. In an industry where Nintendo coated the ground in eggshells and cautioned all to walk slowly, Sega was going head-to-head at full speed. The differences between the two games were self-evident: Sonic ran laps around Mario. The Super Nintendo was still three months away from being released, and already it looked extinct.” (Location 2395)

Here’s a quick refresher on the 22 Immutable Laws of Marketing:

“The name of the game is the game,” Nilsen said, with the bouncy, uplifting rhythm of a prayer worn into the soul by repetition. If Nilsen had known that the originator of the phrase was none other than Nintendo’s Peter Main, he likely would have washed his mouth out with soap. But with the bliss of quotational ignorance, Nilsen repeated the mantra and then pointed to a copy of Atari’s game E.T., which was framed on his wall. “I keep this here as a reminder. Most consider it to be the worst game ever made.” Nilsen pressed his finger up against the glass. “Look at this thing: based on a blockbuster movie, blessed by none other than Steven Spielberg, and had more marketing money pumped into it than any other game.” “And still it failed?” “Miserably! You can still see the markdown stickers on the game,” Nilsen said, pointing to the tiny stickers showing its various price points. “It went from $49.95 to $34.95 then, ouch, $12.99, $3.99, and finally I became a proud owner of the worst videogame ever at $1.99.” (Location 1240)

I loved this documentary. In part, because I owned the Atari 2600 ET game, but also because it’s probably the best, most insightful look into the rise and fall of Atari, as a company, that I’ve come across. Highly recommended.

“I understand,” Kalinske said, standing to leave. “And I appreciate your ode to better, simpler times. But you know what the sad thing is? The man in your story, the one who tipped off Nintendo, I don’t really blame that guy. He was just trying to find an angle. If you ask me, the people really killing this country are the ones who realize the American dream is being crushed but don’t bother to do anything about it.” (Location 1348)
Kalinske was talking business here but I feel like that quote applies to a lot of things these days. (Looking at you, people who don’t vote and gutless politicians from both major political parties.)

–Toy stores were more than just a comfort zone or realm of inspiration to him. They were like a library of cultural mythology. His biggest takeaway from the toy industry had been the importance of story. A toy might be just a piece of plastic, but if you added a compelling narrative and a character mythology, you could transform that piece of plastic into the next big thing. He had proved it with Barbie and with He-Man and the Masters of the Universe, and he was starting to feel more and more confident that he could do it with Sonic as well. (Location 1399)

–Kalinske knew this was the moment that could make or break the company. He had to put it all on the line and urge Nakayama to reconsider. “I’ve been in the videogame business for about five minutes,” he began, “but I’ve been in the toy business for over twenty years. You know what the toy business really is? It’s not about size, shape, color, or price; it’s about character. You want to play with characters you like. You want to become a part of their world and let them become a part of yours,” Kalinske said, overwhelmed with passion. “I can only speak for myself, but there’s not a character out there that I’d rather spend some time with than our new Sonic The Hedgehog. And if I feel this way, I think there are a lot of others who will feel exactly the same.” (Location 1445)

–Kalinske understood and respected that. He knew from Mattel that these weren’t stocks, bonds, and commodities that they were selling; these were emotions, experiences, and ideas. (Location 1563)

I don’t want to sound like a broken record here, but I tell people all the time that if they want to be good at marketing, they need to read “Story” by Robert McKee and, to a lesser extent, The Hero with a Thousand Faces by Joseph Campbell. Yeah, I know “Star Wars” is basically Hero with a thousand faces, but still. No one ever believes when I tell them to read these books, but it’s all about the story. In the case of Sonic, Sega of America put together a 13 page story bible that completely filled in the character’s story, and later did the same for Tails.

Both characters outlasted the company as we remember it. So yeah, go ahead and NOT read those books I just mentioned and keep talking about quantifiable shit over everything else.

“It doesn’t matter what I think. It only matters what will sell.” (Location 1437)

The sign of any good decision maker, especially when it comes to marketing, is to think beyond themselves. You might think something sucks, but that something might be what your customers like, so you gotta do what they like and get past yourself. If you don’t remember this, you’re going to fail.

–“My nonsmirking friend here is correct,” Kalinske said. “A big opening weekend for a movie isn’t proof that it’s any good. It just means they had a nice poster.”(Location 2017)

It’s true, and something to remember because it ties back to what I’m saying: IF your product sucks, even if you have a great initial launch, sooner or later, the word is going to get out that it sucks, and you’re going to be toast when it does.

–“Whenever you’re at war, you must hit the other guy in the mouth as hard as you can with the first punch,” Rioux explained to Kalinske and Toyoda as they plotted Sega’s strategy for the upcoming Consumer Electronics Show. “And if you can’t hit ’em hard, you might as well not even fight. That’s the attitude in real war, and that ought to be our attitude here as well.” (Location 2168)

I’ve said this before in a different way (“You want to hit them so hard that they won’t even think of getting up”) but I like the way the same philosophy is described here. It’s a cliche, and a little on the nose since this is a book about video games, but you play to win or you don’t play at all.

— “Kalinske went on to explain that Nintendo was a victim of the worst enemy of all: high expectations. This was a burden Sega didn’t have to carry. They were underdogs through and through, and this was their greatest advantage. “We have nothing to lose,” he said. “And that’s how we’re going to win.” (Location 2265)

This, to me, was the key to Sega’s success. They really didn’t have anything to lose, and in the end when they DID have something to lose, that’s what killed their company because Sega of Japan started making fear-based decisions given the impending launch of the Playstation and Nintendo 64.

Startups often like to describe themselves as underdogs, but that’s really hard to take seriously sometimes, particularly when we’re talking about ones from Silicon Valley with all their funding, connections, and talent pool. Sega was a real underdog here. Nintendo basically had a monopoly and Sega broke it by being the scrappy upstart startups today could only wish to be.

–“Lincoln finally announced, now ready to reveal the plans for Nintendo’s new CD unit. Olafsson stirred in his seat as the crowning moment inched closer. “And who better to partner with than the company that invented the audio compact disc: Philips Electronics.” Wait, what? A tremor of shock and confusion swept through the room as journalists raced to take note that Lincoln had said Philips and not Sony. After Lincoln said it again, confirming that his words were not a slip-up, all eyes turned to Olaf Olafsson, who tilted his head and furrowed his brow. Was he shocked, appalled, furious? In truth, he was none of those things. He was merely plotting his next move. “(Location 2360)

The story of Sony’s Playstation is fascinating. They wanted to work with Nintendo, and Nintedo fucked them in favor of the long forgotten CD-I. Then Sega and Sony were going to team up, but Sega of Japan got weird about working with SONY and killed the deal. (Later, they would do the same with Silicon Graphics, which would lead to the birth of what became the Nintendo 64.) So the Playstation, which today with Microsoft’s Xbox dominates the video game industry, was born in part out of spite (Sony of America poached a lot of Sega of America’s best employees in the run up to the PS1 launch), but also out of gross incompetence on the part of both Sega and Nintendo.

zelda-cdi

Kind of reminds me of that time Yahoo could have bought Google … And yes, that’s from the Zelda CD-I game that everyone forgets exists.

“Grand aspirations were certainly admirable, but without proper execution they were nothing more than delusions of grandeur. Transforming a 16-bit critter into the next Mickey Mouse, however, presented the same problem as marketing against the Super Nintendo: money. Without a war chest full of financial resources, Sega relied on the kindness of strangers. Or, more specifically, writers from the most popular gaming magazines of the era: GamePro, VideoGames & Computer Entertainment (VG&CE), and Electronic Gaming Monthly (EGM), which had been created to fill the growing appetite for videogame previews, reviews, and rumors. Though they differed in subtle ways (GamePro slanted younger, VG&CE skewed older, and EGM swung for mainstream), the editors at each all had one thing in common: a distaste for Nintendo.

–“To make the math work, Kalinske relied on Nilsen. Ever since joining Sega in 1989, Nilsen had always made it a priority to build strong relationships with the press. He made it a personal policy to return every call, from anyone at any publication, and when doing so he would always have a memorable quote ready. He was all about going the extra mile, whether that entailed flying out to Los Angeles to have lunch with writers from VG&CE or trekking out to Lombard, Illinois, to meet new members of the EGM team. Nilsen took great pleasure in seducing the tastemakers, but what really made his tactics work was that they were not tactics at all. As he saw it, these people were devoting their lives to writing about what he did for a living; they made his life easier, and he wanted to return the favor. It was less about sneakily seeking competitive advantages and more about demonstrating good manners. And if his sentiment contrasted with that of Nintendo, then that was just the cherry on top.” (Location 2526)

Further proof that PR matters. Also: The gaming magazines had problems with Nintendo because Nintendo had their own magazine (one I LOVED when I was little) and “Nintendo Power” got all the good stuff, leaving the gaming mags in the dark for the most part.

–In 1976 Rosen negotiated with Nolan Bushnell for Sega to acquire Atari, but on the day that they were to draft the contract, Bushnell backed out because he learned that his company had successfully developed a new console that could play more than one game (through the innovation of cartridges). (Location 3373)

I’m fascinated by this. Not only did Sega almost buy Atari, but they almost had the Playstation AND almost had what became the Nintendo 64. That’s three major strikeouts, and very likely the reason they just release games these days.

–“Though Atari wouldn’t be launching the 16-bit console, Michael Katz would: Rosen hired Katz to become Sega of America’s second president and release this new console that Rosen had named Genesis, in the hopes that it truly would represent a new beginning for the company. (Location 3432)

I was always curious as to where the name “Genesis” came from, assuming it wasn’t a Bible reference. Now we all know.

–“I made a deal with Mr. Kozuki that I would stick around and continue to take Konami to the top as long as we never did anything worse than cartoon violence. He didn’t hesitate for one second and agreed to the deal. Even more important, he backed up his words with actions. Right around that time we had a game out of Japan called Dracula Satanic Castle, and he let me rename it Castlevania and make other slight modifications. I consider Mr. Kozuki a great friend and I have no doubt that there is eternal truth to his words, but as I look around this industry that we’re all creating, I can’t help but realize it’s only a matter of time.” (Location 3495)

Also included this here because I was curious where Castlevania got its name from. And yes, “Symphony of the Night” is the best game ever made. (Ok. At least … as far as Playstation 1 games go.)

–“Though he was able to change the name, there was not enough time to order new uniforms with the navy and red colors from those Brewers teams of yesteryear. Instead, the newly minted Milwaukee Brewers were forced to adopt the blue and gold of the Seattle Pilots, a color scheme that the team still wears to this day, and on April 7 this new-old team squared off against the California Angels. They lost 12–0. (Location 3847)

I’m a big fan of both baseball and American History. The history of Seattle as a city is basically the history of people being hilariously stubborn and dumb. So I kind of like that they lent their dumbness to the Brewers. (Also fuck Bud Selig. Putting him in the Hall of Fame is ridiculous.)

–Experiences like these led him to believe that the fundamental problem with marketing was its reliance on the past. It looked backward, not forward, and failed to take into account innovation, trends, or cultural shifts in taste. (Location 4049)

Ries and Trout said the same thing, but it’s worth repeating here. People get obsessed with what’s worked in the past. How else do you explain the Lean Startup / Growth Hacking craze in the tech world and the social media craze in the marketing and advertising industry? We took the long lessons from warped interpretations of history and kept trying to repeat them. The only people benefitting were the assholes peddling the bad advice.

The past is the past, and nobody knows what the future holds, so you have to work with what you have in the present.

–It was a marketing ploy, yes, but it worked in the same self-fulfilling way as a blockbuster film did. They’re not called “blockbusters” just because of their budgets; rather, it’s because of the event-like, don’t-be-left-out way that they are marketed, which makes people rush to the theater for the opening weekend, which then makes more people rush to the theater when they hear how big that opening weekend was. (Location 4779)

–“The art of the blockbuster is that it popularizes something before it ever even exists, and though Sonic 2 was still months away from completion, Sonic 2sday gave Kalinske and company an opportunity to unleash the biggest blockbuster the videogame world had ever seen.” (Location 4782)

YES! Of course, as I’ve pointed out here, if the film sucks, you’re fucked, but the point of having tentpole movies and hyping them, that logic makes a lot of sense and is worth studying for your own efforts. Hype is fine. To be clear. Just make sure the thing you’re hyping is good. Otherwise you get this:

–“It’s all about cool; that’s the holy grail. You’re born, you die, and in between you spend a bunch of years searching for it—looking cool, sounding cool, buying cool, and, no matter what, not being uncool. That right there, that’s the secret formula. It’s addictive, it’s enlightening, and it’s goddamn recession-proof. In a world full of too many people shouting too many things, it’s the only adjective that really matters: “cool.” (Location 5085)

True today as it was then. Maybe more so thanks to the Internet.

–“We’ve spent the past month traveling around the country and living with gamers,” Steel said. “We got to know them and understand what they want.” (Location 5218)

–“As laughter emanated from the Sega crowd, Goodby gave an unapologetic shrug. “Hey, I’ve never had a problem with getting my hands a little dirty,” he said. “But before we get into the campaign, I wanted to first show you how committed to Sega our agency really is. So in preparation for the pitch, I went around the office and assigned everyone a Genesis game to master.” Goodby took a step forward and pointed to his employees in the stadium seats. “Over there, we’ve got an expert on every single game that you guys make. Go ahead and ask them any question about any game. I’m totally dead serious.” When the Sega folks realized that Goodby was, in fact, totally dead serious, Nilsen was selected to come up with some brain busters. “In Phantasy Star III: Generations of Doom, what is the name of the main character in the First Generation?” The agency employee assigned to Phantasy Star III stood up. “That’s a tough question,” he said, making Goodby sweat for a second. “But only because there are six playable characters: Rhys, Lyle, Mieu, Wren, Lena, and Maia. If I had to narrow it down to one, though, I’d go with Rhys, the Crown Prince of the Orakian Kingdom of Landen.” “I couldn’t have put it better myself,” Nilsen said amidst applause for the Phantasy Star III expert. (Location 5222)

This echoed what Ray Kroc was saying about knowing your customer inside and out. That’s the trick to selling people something. It’s not hard, but nobody fucking does it these days. “It doesn’t scale”.  That’s bullshit.

I’ve said this before, but it’s like what Robert De Niro says in “Ronan”: “I never walk into a place I don’t know how to walk out of.” The same is true for sales. If you want the deal, you have to do the research.

–“Ultimately, by virtue of these innovations, Street Fighter II was the first fighting game that was actually based on skill and not luck. That’s what made it really click. Well, that plus the fact that it was so goddamn cool to control fighters who possessed the same kind of depth, backstory, and superpowers as iconic comic book characters. (Location 5421)

To say Street Fighter II was a hit doesn’t even begin to describe the amount of success the game had. The fact that right now, for the Nintendo Switch, Capcom is working on the 30th anniversary edition (Ultra Street Fighter II: The Final Challengers) for the Nintendo Switch says it all. And again, it’s all about the story. The fact that most of you can name those characters easily says it all. (Although you’ll be forgiven if you forgot about all of the new characters that came into Street Fighter II with Super Street Fighter II. Except Cammy. Everyone loves Cammy. Everyone.)

–“In some cases, these plans were about identifying Nintendo’s weaknesses and planting a flag where their competitor had not yet broken ground, while in other cases it was simply a matter of taking something that Nintendo already did well and doing it better. (Location 5898)

Yup yup. By the way, we’re almost like 7,000 words in, so can I just say: The fact that Sega of America died because of corporate stupidity just kills me. Nothing lasts man. Nothing.

–“For Kalinske, peddling this version of the truth to the media was no problem, but selling it to his employees was another story. That was the disheartening part, to have to look them in the eye and optimistically explain how this was actually a good thing. Sure, it would have been a lot easier to share in his employees’ collective groan, but the problem with managing that way is that although the bad news is easier to swallow, it also inherently lingers longer. That’s why Kalinske always walked around the office with a smile, saving the frowns for his own time. (Location 6396)

This is a great lesson in leadership. Unfortunately, I would not be very good at hiding my feelings like this.

–“Fischer leaned in. “This is one of my favorite stories. Naka-san gets all the credit, because he designed the game and, you know, he’s this powerful personality, but because of that I think Oshima-san gets lost in the shuffle. So one time I went up to him and asked Sonic’s true creator where that spark of an idea had come from. He’s really shy, this unassuming kid, and I expected him to say something like ‘It was a team effort,’ or ‘It was just one of those things,’ but he smiles really small and he says: ‘I just put Felix the Cat on the body of Mickey Mouse.’ (Location 6550)

So just like how we got Mario because Nintendo needed a Joust like ripoff, thus Sonic was born by remixing Mickey and Felix.

–” And that’s when Nilsen finally realized the fundamental difference between Sega of America and Sega of Japan. They weren’t willing to take the risk, to race Sonic against Mario or welcome a generation to the Next Level. These people were highly talented and certainly not lazy, but deep down they weren’t as interested in winning as they were in not losing. Without risk, there is no reward, and so Nilsen lifted his chopsticks and pulled the plate toward him, proudly eating every last piece of the pufferfish all by himself. (Location 6684)

This, for those of you reading the book because you want to know why Sega died, is your answer. The risk-averse Sega of Japan eventually started calling the shots, and when they did, they killed the company by making irrational, fear-based decisions.

“The world is full of misconceptions, but perhaps none more fatally fantastical than those involving the lemming. As legend has it, these feisty creatures are prone to combating periods of overpopulation by blindly marching one by one off tall cliffs and unceremoniously plummeting to their deaths. It’s unclear where this global rumor began, but evidence suggests that its popularity spread from Disney’s 1958 Academy Award–winning documentary White Wilderness, which highlighted this unusual and unnatural behavior. Although it was later discovered that the filmmakers had flown in the featured lemmings from Canada and had actually tossed them off the cliffs by hand, it was too late to reverse this morbid misconception. (Location 7469)

For whatever reason, this reminded me of Malcom Gladwell. How he grossly oversimplifies or exaggerates, or uses faulty studies to make what New York City intellectuals think are profound statements, but are ultimately empty. I talked about Gladwell and his bullshit in my last book, so it’s not worth rehashing here beyond saying he’s a con artist and you shouldn’t read anything he writes. Fuck that guy forever.

–“It was October 19, 1994, and Nintendo of America’s three amigos were bracing themselves to boldly go where no videogame executives had gone before: cyberspace. Six days earlier, NOA had announced that in an effort to make Donkey Kong Country the biggest game ever, Nintendo would become the first videogame to utilize online technology for a new product launch. Nintendo’s three-month online campaign would be available exclusively on CompuServe, the leading worldwide Internet service with 2.3 million members. To attract attention and bridge the gap between corporation and consumer, the campaign would kick off with a live, one-hour chat hosted by Arakawa, Lincoln, and Main. (Location 8816)

–I know people get bent out of shape over Reddit and their mostly bullshit story of how they got to where they are (I covered Reddit extensively in the ghostwritten book, but here’s the short story: PR and relationship with Condenast’s Wired + Sockpuppets + Copyright Infringement + Questionable photos of Teen Girls  + Collapse of their rival Digg + Blogs using them as a source = More media hype = Alexis Ohanian constantly getting blown for being a genius for no reason.  Fuck that guy forever as well. But also, that’s seriously the story of Reddit. And another one of the things they get praised (and credited for) are the Ask Me Anything threads. While fun to read (I’m a reddit user since 2007, I can throw shade at them if I want), the AMAs are actually things AOL and Compuserve did long ago.

” Nearly ten years earlier, Arakawa, Lincoln, and Main were plotting how to get a product nobody had ever heard of into stores everywhere. Slowly at first, and then quickly as credibility grew, these men succeeded in spectacular fashion. Inch by inch, they willed their way into more than 20,000 stores, and Nintendo products were available in just about every retail space imaginable. (Location 8825)

A long, LONG, time ago, I read this thing on how Jerry Seinfeld stays so productive. You should read it. And then after you do, look at what Nintendo did here. “Inch by inch”. If you want to be successful, you have to know what you want, and then break down that thing into a thousand small steps, one of which you can take every day, to make it happen. That’s not groundbreaking advice. Everyone says that, but it’s the truth.

“Inch by inch anything’s a cinch.” Funny enough, Sega learned a lot from Nintendo, but Sega of Japan didn’t learn and remember this one thing, and that’s why the company died.

One last thing …

“First to market doesn’t mean much,” Lincoln started. “It’s what you do, not when you do it.”

There’s this belief among tech companies about First Mover Advantage. It CAN be true, but more often than not, being first doesn’t mean shit. It means being best, and THEN in the mind of your customers, being first. So you’re not the first to market, but you’re the first that’s AWESOME. Peter Thiel talks about this in “Zero to One”. It’s not a great book, but that was one of two things I came away from that book remembering and thinking it was smart. (The other being that you can’t just be better than your competitor, you have to be so much better that they can’t just copy you and steal any advantage you had away.)

Nintendo knew that lesson well. Sega was first to market with the 16 bit Genesis and the 32 bit Saturn, but the Super Nintendo and the SONY Playstation beat them both because both companies put the priority on having the best games. Like I don’t know how many of you remember, but I bought a Playstation not long after launch, and they had so many games that were awesome at the time that I didn’t even know what to buy. Twisted Metal. Warhawk. Ridge Racer. Ray Man. NBA Jame. Hell even Toshinden was cool. (So cool, I went and watched the anime. And then not long after that, you had Tekken and just wave after wave of games.

You couldn’t say that for the 32X, Sega CD, Saturn, or even later, the Dreamcast. All these things were first to market, and they all failed.

And if you want an Internet example, how about this: Netscape, despite people saying otherwise, was not the first graphical interface browser. Facebook was not the first social network (not by a long shot). Google was not the first search engine. Reddit is an (admitted) ripoff of Digg because Ohanian’s first idea was dumb. The list goes on.

I’ll close with this

 

High School Me was SUPER excited about this bad, bad film.

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