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use of the camera and GPS systems on mobile devices to combine reality with the virtual reality of Pokémon. Despite adding little revenue, Pokémon Go took the world by storm with millions of downloads within the first few days of the launch. Following the app release, Nintendo’s market value increased by about $9 billion. In 2017 Nintendo’s latest console the Nintendo Switch was released, which is a hybrid console that can be used as a stationary and portable device. The Nintendo Switch can be played in three different modes, TV mode—where the Switch can be docked to enjoy HD gaming on the TV, Tabletop mode—where the stand can be flipped open and games can be played with multiple players, and the final Handheld mode where the player can pick up the Nintendo Switch and play an individual game with the Joy-Con controllers attached. These recent developments showthat Nintendo’s ability to provide entertaining games paired with the introduction of new software and new ways to enjoy gameplay has appropriately kept them at the top of the video game industry.External Environment5
The external environment of the video game industry are the factors that affect its ability to fulfill its aims and functions properly, also known as the operating environment. These are also the conditions that influence the activities and choices of an industry and determine the available opportunities and risks. The six factors in the external environment are customers competition, economy, technology, political and social conditions and resources.The first part of the external environment is the macro environment which includes the industries, companies, competitors and clients of a particular industry. The factors that affect the macro environment are technology, economic conditions, legislation, regulation, population demographics and societal values. Technology is vital to the video game industry because the constant evolution of technology results in the development of new ways to bring video games to their users. The economic conditions of a country are also an important factor because it will affect how consumers react to new video game releases. If the economy isn’t doing well then consumers will be less likely to spend money on a video game, while on the other hand when the economy is doing well video games sell more. Additionally, legislations and regulations determine the framework for which companies within the video game industry operate. All video games released must comply with industry code of conduct in order to avoid lawsuits. Finally, population demographics and societal values play a large role in the macro environment. Video games are largely targeted towards male gamers, so if the population consists of more men than women, it will increase sales and profitability. The second factor of the external environment includes the customers. The video game industry relies heavily on customer feedback andsatisfaction in order to remain successful. There are various video game