I appreciate Business Insider’s spunk, and would actually welcome Nintendo games on my iPhone and soon-to-be purchased iPad, but let’s be honest and completely un-fun for a second:

With the exception of that Philips CD-i Zelda disaster that we’ll never speak of again, Nintendo will never, ever put their games on another company’s hardware.

But like I said above, it would be pretty awesome, right? Who in their right mind wouldn’t buy a “Virtual Console app” from the App Store? It’d sit there on your iPhone screen, waiting to be pressed, and when it was, it would open up and show you all the 8-bit titles you’ve purchased from Nintendo, through Apple, thus far. And there’s the first rub, the

Profit

problem. Nintendo is notorious about making oodles of cash from all of their products and software, from day one. Case in point: Every single fricking thing they’ve ever done, with the exception of possibly R.O.B, the Power Glove and the Virtual Boy. Wii? Profitable from day one. No loss leader there. Same with the never-ending stream of DS hardware they’ve paraded out over the past five years.

Do you know what happens to a developer that puts their app in the App Store? Or a musician who bites the Apple and starts selling Mp3s through iTunes. Well, yes, they sometimes make insane amounts of profit themselves, but they also pay a 30% fee to Apple for the privilege of doing so.

In Nintendo’s case, they already have a wildly successful console, and a moderately successful download service in WiiWare/Virtual Console, from which they derive 100% profit on all first party titles, and a % profit from third party games downloaded through the platform, just like iTunes or Xbox Live Arcade or PlayStation Network. Put simply, there’s no need to try and sell games via the App Store, so why bother?

Now, when I say that I’m sure people are already rushing to the Google to get a link to this graph, but wait a second. Chill. Numbers are fun, and stats are grand, but the big picture is probably less-than-worrying to the Big N.

First, the iPhone/iPad platforms are relatively new, cool and fresh. I’m completely unsurprised that they’ve been able to secure 20% of a generation that’s entering its sixth year in existence and is about to be turned on its head by Nintendo’s unicorn-powered three-dimensional mystery portable, the 3DS. Anyone care to make a guess as to what the App Store’s slice of pie will look like in one year, should the 3DS prove wildly successful? Probably substantially less than 20%. And even if the number stays the same, there’s nothing wrong or worrying about a company controlling 70% or even just 50% of an entire market. You don’t see Apple complaining that their stale as dirt iPods control “just” 60% of a market they used to dominate, right?

Also, and perhaps more importantly, have sales numbers really declined for DS products over the past year? Is Nintendo even “threatened” by the 20% number, in terms of units sold and games devoured? Nothing I’ve read beyond that graph seem to indicate that this is the case at all. It’s no surprise that rampant Internet-driven hyperbole has made it seem like it is though.

And then there’s the PSP/PSPGo trainwreck (U.S./Europe only, as in Japan it’s actually selling at a brisk pace), which is another large reason, IMO, why the App Store has been able to secure such a large 20% portion of that Digg’d–to-death graph and pie chart above. When the number two seller in a two-person race is fading fast, who can say, with a straight face, they’re surprised that an up and coming third challenger is gaining ground?

Then there’s

Control

Put simply, Nintendo is one of the most controlling, domineering hardware/software companies on the planet, matched only in obsessiveness by Apple. A big reason why their first party games are successful is because from top to bottom they control everything. Just like Apple.

Nintendo developers have first crack at Nintendo systems. Nintendo marketers have first crack at seeing and selling Nintendo games. This says nothing of the fact that masterminds like Miyamoto, Iwata and pre-Metroid Other M Sakamoto are at the controls of these games to begin with. A major plus there, to be sure.

But the moment Nintendo puts a Virtual Console app on the iPhone or iPad, a part of that control goes away. The games, as good as they are, are now at the mercy of another company’s terms; another company’s OS; another company’s touchscreen interface. It sounds stupid and overly simplified, but it’s true: Something as mundane as someone not liking Super Mario Bros 3 controlled with a touchscreen could have a negative impact on Nintendo’s brand, image, and profit. I know that I, for one, really don’t like playing platformer-type games on my iPhone. In fact, beyond Fieldrunners-style games or other kind of slow-moving simplistic fare, I really haven’t found much of a robust gaming experience on my iPhone. It’s no arcade machine, for sure, which means that many of the NES-era games (arcade ports with arcade interfaces) just would not work on the iPhone.

So the moment Nintendo puts these games on the iPhone and they don’t work, which they don’t really, a number of negative things, outlined above, start to happen. That equates risk. Unnecessary risk too, as Nintendo is currently the undisputed champion of gaming—portable or otherwise. So why take it? Why even upset the cart with an “experiment,” as the baiting commentary over at Business Insider wants Nintendo to do?

Then theres the issue of Apple control. Talk to any developer, even successful ones, and you’ll hear of all the hoops they have to jump through, from approval process to scheduling to pricing to everything else Apple’s Draconian T&C’s have them do—and I’m saying this all as an Apple fan!! Again, though, more loss of control. Nintendo would never allow that.

Of course, I’ve been wrong before (saying Okami would do well on Wii is one example). And in this case, I actually supported the idea of a Virtual Console app on my iPhone when David and I discussed it at PAX East. But it was pipedream talk. I’d support it if it happened, but it’s not.

That said, if I’m wrong about this, and Nintendo unveils some uncontrolled, Wild West iPad Virtual Console app at E3, it’ll be the best bad call I’ve ever made. As penance, I’ll download the app on day one and play the ever-loving sh*t out of it. It will be, without a doubt, th best punishment ever.