ESA on Trump Tariffs: 'More Than Just Switch 2'

The past 48 hours have been a whirlwind for those keeping up with economic news, and even more so for Nintendo enthusiasts. On Wednesday, it was revealed that the Nintendo Switch 2 would be priced at $450 in the United States, a figure analysts attribute to anticipated tariffs, as well as factors like inflation, competition, and rising component costs.

The situation escalated when the Trump Administration announced sweeping 10% tariffs on goods from nearly every country, with significantly higher tariffs targeting nations such as China, the EU, Japan, Vietnam, Canada, Mexico, and others. In a swift response, China imposed a 34% reciprocal tariff on all U.S. goods. Amidst this turmoil, Nintendo made the decision to postpone pre-orders for the Nintendo Switch 2 in the U.S. to assess the impact of these tariffs on their console strategy.

This unprecedented series of events has left everyone, from gamers to industry analysts, scrambling to understand the full implications. Just before Nintendo's announcement, I had the opportunity to speak with Aubrey Quinn, a spokesperson for the Entertainment Software Association (ESA), about the potential effects these tariffs could have on the gaming industry at large.

The ESA, like many others, is still piecing together how these developments will unfold. Quinn noted that while tariffs were anticipated due to previous actions and campaign rhetoric from the Trump administration, the extent and retaliation from other countries, particularly China, were not fully predictable. The ESA is cautiously monitoring the situation, aware that further U.S. tariffs and international responses might still be forthcoming.

Quinn was clear, however, about the expected negative impact of these tariffs on the video game industry. She stated, "We really are, at this point, just watching and trying not to have knee-jerk reactions, because we don't think that what President Trump announced this week is the end of the story, but what was announced this week and the tariffs as outlined, we do expect these tariffs will have a real and detrimental impact on the industry and the hundreds of millions of Americans who love to play games. And so our goal is to work with the administration, to work with other elected officials to try to find a solution that doesn't damage U.S. industries, U.S. business, but also American gamers and families."

The ESA foresees a broad range of consequences, from increased system prices to reduced consumer spending, which would in turn affect company revenues, job security, and investment in research and development. Quinn emphasized the interconnected nature of the consumer ecosystem, suggesting that these tariffs could influence the design and capabilities of future consoles.

In response, the ESA is actively engaging with policymakers, though Quinn acknowledges the challenges. With a new administration and many new appointees, it has been difficult to leverage previous relationships. Nonetheless, the ESA is determined to foster dialogue with key figures to highlight the potential harm to businesses and consumers alike.

Quinn highlighted the ESA's involvement in a coalition of trade associations that reached out to U.S. Trade Representative Jamieson Greer before the tariffs were announced, expressing their concerns. They are also seeking meetings with legislators and administration members to discuss these issues further.

When asked about the effectiveness of these efforts, Quinn confirmed that conversations are taking place at various levels of government, including with the White House and the Office of the United States Trade Representative (USTR). She stressed the broader impact beyond just the video game industry, noting that all consumer products could be affected.

For concerned consumers, Quinn recommended reaching out to elected representatives through letters, calls, emails, or social media to express their worries. She believes that increased constituent feedback could lead to greater attention and potential action from government officials.

Shortly after our conversation, Nintendo announced the delay of Nintendo Switch 2 pre-orders due to the tariffs. While the ESA does not comment on individual company decisions, Quinn did address the broader implications of these tariffs on the gaming industry. She pointed out the unfortunate timing of the Switch 2 reveal coinciding with the tariff announcement and emphasized that the impact would extend to all gaming devices, from consoles to VR headsets and smartphones.

Quinn concluded by underscoring that the effects of these tariffs are not limited to any single company but will affect the entire industry, regardless of where the products are made or sold.