Ten million units. That was the annual scale of Nintendo DS sales in the Americas during the height of the handheld’s dominance. At that volume, the hardware company maintained a strong position in a marketplace where retail partners sought consistent inventory. However, this high volume of sales coincided with a period when Amazon, then an e-commerce entity rapidly expanding its footprint into video games, attempted to leverage its growth to dictate pricing terms.
The tension culminated in a direct confrontation between the former president of Nintendo of America and an Amazon executive. According to details shared during a lecture series talk, the retailer sought a specific type of financial arrangement to ensure it could maintain the lowest price point in the market.
The demand for an obscene amount of support
Amazon’s objective during this period involved expanding its presence in the gaming market. The company aimed to position itself as the cheapest option for consumers, specifically targeting the ability to undercut big-box giants like Walmart. To achieve this, Amazon sought financial concessions from Nintendo that would effectively subsidize their retail pricing.
The former president described the request as a push for an obscene amount of support, financial support, so they could have the lowest price and beat Walmart
. The request did not reach the executive level immediately; it first progressed through various levels of the sales organization before the former president intervened directly.
A disagreement developed between the two parties. When the former president confronted the Amazon executive about the nature of the request, the executive maintained the desire for the requested outcome despite the legal warnings. As recounted in the lecture, the former president asked the executive, You know that’s illegal, right? I can’t do that
. The result was a period of silence on the line, followed by a reiteration from Amazon that the requested support was still what they wanted.
Retail parity and the risk of legal breach
The core of the conflict rested on the legality of the requested financial arrangement. For a hardware manufacturer, granting one retailer the financial means to systematically undercut all others is viewed as a significant risk. Nintendo’s leadership determined that providing this specific type of preferential support to a single partner to manipulate market pricing was an unacceptable business practice.
Beyond the legal risk, there was the matter of retail relationships. Nintendo’s distribution model relied on a network of partners who required a level playing field to remain viable. If Amazon were allowed to artificially lower prices through manufacturer subsidies, it would have jeopardized the company’s standing with every other retailer in the Americas.
“Literally we stopped selling to Amazon, and it’s because I wasn’t going to do something illegal. I wasn’t going to do something that would put at risk the relationship we have with other retailers.” Nintendo executive, lecture series
By cutting off sales to Amazon, Nintendo chose to prioritize legal compliance and partner stability over the volume that the rising e-commerce giant could provide. This decision effectively removed Wii and DS systems from the Amazon storefront for a period, creating a void in the marketplace during the consoles’ peak popularity.
Building respect through corporate boundaries
The cessation of sales served as more than a legal safeguard; it was a strategic signal. The former president noted that the decision set a precedent for how the company would interact with the e-commerce giant moving forward. By refusing to be pressured into an illegal arrangement, Nintendo established a boundary that defined the terms of their business relationship.
The executive explained that the move was intended to demonstrate that the company would not be pushed around, stating, This is the way we do business. And so that’s how over time you build respect
. This philosophy of maintaining strict boundaries appears to have characterized the long-term, often tumultuous relationship between the two companies.
The friction did not end with the DS era. Kotaku reports that the two sides have stopped working together on multiple occasions over the years. This has manifested in first-party games becoming unavailable on the platform or pre-orders being cancelled. As recently as 2024, the relationship paused again, with some speculating the turmoil was linked to third-party sellers undercutting Nintendo.
The history of the partnership reflects a clash of cultures: one company focused on the curated control of its hardware ecosystem and the other on the aggressive, low-cost expansion of a digital storefront. While the two companies eventually patched things up for the launch of the Nintendo Switch 2, the legacy of the DS era remains a case study in the risks of preferential retail support.
The fallout from that initial phone call underscores the precarious nature of the “lowest price” strategy. When a retailer’s growth strategy relies on manufacturer subsidies to defeat a competitor like Walmart, it creates a vulnerability that a disciplined hardware provider can exploit by simply removing the product from the shelf.