With little exception, having age-appropriate gaming tournaments is a good thing for a game (and the company behind it). Big communities getting together to play their one-on-one games means people bringing guests who might be interested enough to buy a set of cards or minifigs after and play in the next get-together.
Some companies even make guides for tournament hosters, partially as an investment in the community, partially so any tournaments hosted using that pack won’t reflect poorly on the parent company. Others go even further and sponsor tournaments themselves, like Capcom with its Street Fighter tournaments. Copyright permissions are handled differently by different companies in different mediums, but generally the tournament event can use their game’s imagery and names to advertise for-profit events as long as the event follows rules established by the company.
If done right, the players have a fun and exciting time, the game company gets a bunch of free (or subsidized) advertising, and everybody wins.
Nintendo’s decision to ban large tournaments in this environment is nothing short of bizarre!
The Announcement
Nintendo’s announcement regarding tournaments using their games boils down to: no huge events (200 spectators or less IRL, 300 or less online), no use of Nintendo copyright properties to advertise (including game names), no merchandise, food or drink sold in-person at the events, and no profit (ticket prices and winning pools are capped to ensure this). Organizers also can’t raise the prize money from ticket sales or use modified versions of the game, either, and must obtain a special license from Nintendo before the event takes place. While Nintendo is legally well within their rights to do this, why would they? Capcom enjoys a huge amount of positive publicity thanks to it’s 2D fighter tournaments. Magic: The Gathering is known for drawing large crowds to events, and Wizards of the Coast, its owner company, is pleased to see it. Nintendo was not.
As you may guess, this severely handicaps future tournaments! Smash tournaments, one of the cornerstones of the early online competitive gaming communities, have just been slashed pretty hard. For context, Smash Summit has had final winning pools in the five-digit range since 2016. Smash Ultimate Summit has hit the six figure range. Smash tournaments have been running since the last decade. Hundreds, perhaps thousands of players have passed through these tournaments hoping to win, and the spectator count is magnitudes higher. Nintendo may not have set out to make tournament-ready games, but by golly they did, and now they want to take it back.
What Now?
Playing a game competitively is very, very different from playing it for fun. People dedicate huge chunks of their life to trimming off inefficiencies and practicing. For many, it is literally a second job, during which they may stream their practice to make some money off of all of the hours they’re investing into learning. The people viewing those streams then go on to watch them in the tournament, bringing money in for the tournament host, too.
Nintendo effectively just crushed an entire industry. Rather than work with the fans and try to spin their tournaments into advertising the way many other companies do, they instead decided that the current tournament fanbase was unreconcilable with their goals and simply cut them off. Already, Smash tournament organizers (often retired tournament winners themselves) are promising they’re going to keep going until they personally receive a cease and desist from Nintendo. They don’t really have another choice – players aren’t typically interested in switching games and losing all their practiced skill to switch over to Street Fighter or any other 2-D fighting game.
Who knows what happens next. Nintendo owns the intellectual property that this industry is built off of, but rug-pulling it like that has generated a lot of backlash from adult fans, even ones who weren’t watching tournaments before. It echoes the move that Unity just made, and before that, Adobe. The average consumer is getting sick of companies squeezing them out of stuff they already spent their money on. Nintendo may have underestimated the negative press from this announcement, but whether or not they’ll walk it back remains to be seen.
Sources: https://www.yahoo.com/lifestyle/fun-sponge-nintendo-places-strict-094104104.html
https://kotaku.com/smash-bros-ultimate-switch-nintendo-tournaments-1850955614 (warning – link contains foul language sourced from tournament competitors’ tweets in direct citation)