The sales data of 500,000 PCEngine units in its first week quickly reached Nintendo Headquarters in Kyoto.
Hiroshi Yamauchi promptly convened a meeting with his executives.
Hiroshi Yamauchi's face was still ashen, but deep in his eyes, there was a rare hint of gravity.
He didn't erupt in a thunderous rage as he had last time; his fingers merely tapped rhythmically on the table, emitting a monotonous "tap, tap" sound, each tap like a hammer striking everyone's heart.
"Five hundred thousand units,"
An executive repeated the number with difficulty, his voice filled with disbelief.
"To achieve such sales in just two weeks, solely relying on an anime tie-in like immortal demon war."
"This indeed exceeded our initial estimates."
Gunpei Yokoi pushed up his glasses, his eyes behind the lenses gleaming with analytical light.
"This once again proves the enormous pull of popular anime tie-ins for initial market promotion."
"However, as we previously judged, PCEngine's high price of 24,800 yen and the current predicament of only two launch titles remain their fatal weaknesses."
"How long the immortal demon war craze can last is unknown. Once players' novelty wears off, if the subsequent game lineup doesn't keep up, this momentum will inevitably decline rapidly."
Shigeru Miyamoto also nodded in agreement, his tone steady.
"Yes, the short-term burst of power is indeed astonishing, but the console war is ultimately a long-term positional battle, competing on the ability to continuously output high-quality games and the stable ecosystem built from it."
Hiroshi Yamauchi's tapping stopped.
His sharp gaze swept over everyone, and he slowly spoke, his voice low but carrying an undeniable authority.
"The emergence of PCEngine and its initial market performance have given us a wake-up call."
"But, it's not enough to shake Nintendo's foundation."
"However, this also exposed some issues we had previously in third-party management."
An executive responsible for third-party liaison showed a hint of awkwardness, carefully interjecting.
"President, previously, we dispatched 'game content consultants' to some key third-party development teams, intending to assist them in improving quality and ensuring compliance with Nintendo platform's overall tone."
"But in practice, it did — well, it caused some unnecessary friction."
He weighed his words, trying to take some responsibility while not completely denying the president's original intention.
"For example, over at Konami, I heard that some of their younger developers had quite a few complaints about the modifications suggested by our consultants, believing it interfered with their creative freedom and even affected development progress."
"This method of directly embedding personnel now seems to be a bit excessive, and may instead damage the trust between us and our important partners."
Hiroshi Yamauchi snorted coldly, tacitly acknowledging the existence of this viewpoint.
"Since direct guidance on content is ineffective and prone to backlash."
His eyes narrowed, his tone carrying an undeniable determination.
"Then, we will change our approach."
"To ensure the continued leading quality of Nintendo platform software, and to safeguard the healthy and stable development of our important third-party partners, preventing them from falling into financial difficulties due to blind expansion or poor project management, thereby affecting game supply to our platform."
His tone shifted, his voice carrying a "sincerity" of "thinking for your benefit."
"I have decided, effective immediately, to adjust the cooperation management model for third-party developers."
"We will no longer directly dispatch 'game content consultants' to supervise specific game design aspects."
At these words, several executives breathed a slight sigh of relief, thinking the president was finally going to relax some controls.
However, Hiroshi Yamauchi's next words made their hearts leap into their throats again.
"Instead, we will shift our monitoring focus from 'game content creation' to 'project financial health'."
"All third-party developers who have signed royalty agreements with Nintendo must, starting next month, regularly report the detailed financial status of all game projects they are currently developing for FC or future Nintendo platforms to Nintendo."
"Specifically including, but not limited to: the amount of reserve funds at project initiation, the status of subsequent fund availability, and regular expenditure reports."
The corner of Hiroshi Yamauchi's mouth curved into a cold arc, as if he could already see those third parties unable to escape Nintendo's control.
Nintendo's legal department, finance department, and third-party liaison department were highly efficient.
Within just a few days, a meticulously worded, detailed, and authoritative "Notice on Strengthening Transparent Financial Management of Cooperative Development Projects," full of "professionalism" and undeniable authority, was delivered via encrypted fax and express delivery to the desks of all third-party game developers who had signed cooperation agreements with Nintendo.
Every line of the document exuded "goodwill" for "your benefit," ensuring that partners could "focus" on developing games for Nintendo, and a "sense of responsibility" for "jointly maintaining market order."
However, the presidents who received this notice, without exception, felt a chilling coldness and intense humiliation.
Tokyo, SNK Headquarters.
President Eikichi Kawasaki watched the document slowly emerge from the fax machine, the flesh on his face twitching violently with anger.
He snatched the thin paper, his eyes blazing.
"Outrageous!"
A roar shook the office windows, making them hum.
He slammed the notice onto the expensive mahogany desk; the paper bounced up from the immense force and then floated down.
"What do they take SNK for?"
"Nintendo's subsidiary? Or their accounting department?"
"They want us to report every single entry in our own company's ledgers to them? What exactly does that old bastard Hiroshi Yamauchi want?!"
"Does he think he's the Shogun?!"
Eikichi Kawasaki paced back and forth in his office, his chest heaving with rage.
"We work so hard to develop games, earn money, and how we spend it, where we spend it, Nintendo has to dictate it?!"
"Who is the president of this company, after all?!"
Almost simultaneously, in Namco's president's office.
Masaya Nakamura's brows were tightly furrowed, the notice clutched between his fingertips as he repeatedly read every word on it.
His anger was not as outwardly expressed as Eikichi Kawasaki's, but the gloom in his eyes was heavier than the sky outside, which was about to rain.
"Reserve funds, fund availability, detailed expenditure reports."
He mumbled these words, a bitter, cold smile playing on his lips.
"Hiroshi Yamauchi, he no longer treats us third parties as independent companies."
"This is blatant financial monitoring, a disguised takeover!"
He gently placed the document on the table, his gaze directed out the window, seemingly contemplating something.
PCEngine's 500,000 first-week sales were now exceptionally clear in his mind.
Perhaps, it was time for deeper contact with Hudson and NEC.
Putting all eggs in the basket of Nintendo, this increasingly tyrannical despot, was simply too risky.
Meanwhile, within a game development department at Konami.
Several young developers were gathered, discussing in low voices.
"Did you hear? That Nintendo 'consultant' who always dictated our projects seems to have been recalled."
"Really? That's great! I was sick of him!"
"Now it's quiet, we can finally polish the game according to our own ideas."
Their faces were alight with relaxed smiles, as if a great mountain pressing down on them had been removed.
They did not know that a larger, heavier pressure had silently shifted onto the shoulders of their president, Kozuki Kagemasa.
At this moment, Kozuki Kagemasa was staring at the notice, his face ashen, not uttering a word.
As night fell, in a secluded private room of a Tokyo ryotei.
Several presidents of prominent third-party game companies in the home console market were, uncharacteristically, gathered together.
The initiator was none other than the furious SNK President Eikichi Kawasaki.
Attendees included Masaya Nakamura of Namco, Kozuki Kagemasa of Konami, Kenzo Tsujimoto of Capcom, and the president of Taito Corporation was also present.
After several rounds of drinks and dishes, the atmosphere in the private room remained oppressive.
Eikichi Kawasaki put down his sake cup and slammed his hand on the table.
"Gentlemen, I presume you all received that notice from Nintendo, correct?"
Everyone nodded silently, their expressions grim.
"That old man Hiroshi Yamauchi, this time he's gone too far!"
Eikichi Kawasaki's voice carried an uncontrollable rage.
"Before, sending some 'consultant' to dictate our game content was one thing; after all, the game sells on his platform, and he wants to ensure quality, so we grudgingly accepted it."
"But now, they want to inspect our ledgers directly!"
"Are they treating us like thieves, or like three-year-old children to be disciplined?"
"By what right does Nintendo dictate our company's internal finances?!"
"Who is the president, after all?!"
This question, filled with humiliation and anger, was like a spark thrown into boiling oil, instantly igniting the resentment in everyone present.
"President Kawasaki is right!"
Even Kenzo Tsujimoto of Capcom, who usually had a strained relationship with SNK because of Yoshihiko Arai, slammed his thigh, his normally composed demeanor now unable to hide his excitement.
"We painstakingly invest capital, organize teams, and take risks to develop games, and Nintendo enjoys the royalties, which is fine, but now they want to reach into our pockets to see how we spend our money?!"
"This is an utter disgrace!"
The president of Taito also sighed, his tone full of helplessness and indignation.
"FC's market share is too high; we have no choice but to bow our heads."
"However, this paternalistic financial monitoring severely violates our dignity as independent enterprises and our right to independent operation."
"If this continues, what's the difference between us and Nintendo's OEM factories?"
Masaya Nakamura picked up his sake cup, took a sip of sake, his eyes deep.
"Gentlemen, anger aside, we must admit that in the home console market, Nintendo's FC and NES are still the absolute overlords."
"Publicly breaking ties with them would not benefit any of us."
His words cooled the agitated atmosphere slightly.
Everyone fell silent; they all understood this cruel reality.
Kozuki Kagemasa put down his chopsticks, his voice low.
"President Nakamura is absolutely right. But, are we just going to let Hiroshi Yamauchi manipulate us like this forever?"
"This time it's financial monitoring; what about next time? Will he directly demand we hand over our company seals?"
His words carried a hint of self-mockery, yet also expressed everyone's deeper anxieties.
Masaya Nakamura put down his sake cup, his gaze sweeping over everyone.
"The more forceful Hiroshi Yamauchi is, the more it indicates he feels pressure from changes in the market."
"The emergence of PCEngine, although it seems to have many issues currently, at least proves that there isn't only Nintendo as an option in the market."
He paused, lowering his voice further.
"I've maintained some private contacts with the Kudo brothers at Hudson, and with NEC."
"If you are interested, I can connect you; at the very least, learning more about the situation is not a bad thing."
At these words, the air in the private room instantly became subtle.
A glint flashed in Kozuki Kagemasa's eyes, and he interjected.
"Speaking of new options, you might not know this yet."
"Sega also seems to be secretly developing a brand new 16-bit console."
"I've received some fragmented information; it's said to be quite powerful, far surpassing PCEngine, and may even pose a real threat to Nintendo's future console plans."
This news exploded like a bombshell in everyone's hearts.
Sega? The Sega that dominated the arcade market but repeatedly failed in the home console market?
Did they really have the ability to challenge Nintendo's hegemony?
Despite being filled with questions and uncertainties, one thought quietly began to sprout in the minds of these presidents, who were suffocated by Nintendo.
Don't put all your eggs in one basket.
Especially when the owner of that basket increasingly disregards them.