Nintendo just abandoned its biggest gamble since the Switch
Dragalia Lost is no more.
Dragalia Lost has reached its final chapter ... literally. Nintendo announced it will stop supporting the mobile game shortly after the July 2022 update. (If you’re one of the few whales who has dropped thousands of dollars in the game, we are sorry for your loss.) Dragalia Lost isn’t just the latest casualty of Nintendo’s experimentation in the mobile market — it also sheds light on the idiosyncratic way that the company approaches gaming trends at large.
What happened — “After the main campaign has ended, service for the game itself will end at a later date,” the official Dragalia Lost Twitter account announced Tuesday. “Please see the message linked below for more details, and thank you for playing #DragaliaLost.”
In the accompanying blog post, Nintendo reveals that Chapter 26 Part 2 will bookend the four-year campaign. The actual closure of the game will be announced at a later date.
Dragalia Lost is Nintendo’s first original mobile game developed in collaboration with Cygames, the studio that published Granblue Fantasy. An engaging story and satisfying gameplay drew praise from Metacritic users, but it didn’t prevent Nintendo from pulling the plug.
An end in sight — A dip in revenue in the 2020 fiscal year most likely marked the beginning of the end.
“Dragalia Lost earned around $22M only from April 2020 to March 2021. This is quite alarming because it might mean the game will end in its third year,” one Redditor predicted in an April 2021 post. “I don't want DL to die because this is such a good game.”
One commenter also noted that Dragalia Lost’s free-to-play design could be partly to blame as “both its best trait and its worst.” Nintendo’s foray into the gacha market, where simply getting the best characters can feel a lot like gambling, was a refreshing change of pace. But there simply isn’t much to buy in Dragalia Lost, and that means that players don’t spend as much money.
It bucks the biggest trend in mobile gaming: deliberate design choices that force players to pay to win — or even just pay to keep playing.
Lack of IP awareness — Dragalia Lost is an original IP, and that may have been its biggest hurdle to overcome. Companies like Activision Blizzard and Square Enix develop mobile spinoffs of hit franchises to draw in consumers. Nintendo fans already know and love the characters of Fire Emblem Heroes, but Dragalia Lost never had an existing fanbase to leverage.
According to Niko Partners analyst Daniel Ahmed, Nintendo recently generated about $450 million from its mobile and IP licensing business. Dragalia Lost is also Nintendo’s most notable mobile game shutdown after Dr. Mario World, which it shut down in 2021.
Nintendo’s unorthodox approach — Nintendo is notoriously protective of its IPs and hesitant to branch out of what it knows best. Back in 2011, then-president Satoru Iwata expressed cynicism about mobile gaming to Japanese media outlet Nikkei.
"This is absolutely not under consideration," Iwata told Nikkei (via IGN). "If we did this, Nintendo would cease to be Nintendo.”
Nintendo’s past reluctance to invest in mobile gaming mirrors its vocal reservations with esports, so it isn’t the first time that it only dipped its toe into an adjacent industry after a push. But company leaders likely changed their minds about mobile gaming after the tremendous success of Niantic’s augmented reality phenomenon, Pokémon Go.
Nintendo has dabbled in the mobile market for years with intermittent since 2016. Besides Dragalia Lost, it’s currently supporting Mario Kart Tour, Fire Emblem Heroes, Mario Kart Run, and Animal Crossing: Pocket Camp. Success has varied, but Fire Emblem Heroes generated $656 million in revenue worldwide as of 2020. Nintendo experiments with unorthodox game formats — like the mixed reality approach of Mario Kart Tour — but it isn’t afraid to call it off if an experiment doesn’t work.
Dragalia Lost is the only original IP among Nintendo’s mobile offerings, and will probably be the last experiment of its kind. Meanwhile, mobile games like the aforementioned titles and Pokémon Unite will likely remain an ongoing focus for Nintendo.
The Inverse Analysis — Nintendo might not invest in any more original mobile games. However, it might be learning from its competitors and past experience about what kind of games to put out at a lower risk. It hasn’t quite nailed it with its mobile gaming campaigns, but that doesn’t mean it’ll necessarily stop. Nintendo didn’t release many mobile games in the past two years, but it did green light Pikmin Bloom (which, again, is based on an existing IP). Hopefully, this lesson with Dragalia Lost won’t be for naught.
Dragalia Lost is currently available for iOS and Android devices, but not for long. Its final chapter is coming in July 2022.