Nintendo Stopped Selling to Amazon Over Price Fight

Reggie Fils-Aimé, who used to run Nintendo of America, recently revealed that Nintendo cut off its direct sales to Amazon in the late 2000s. The reason: Amazon asked Nintendo for money to help it undercut Walmart's prices on Nintendo products.

According to Fils-Aimé's account, an Amazon executive asked Nintendo for what he called an "obscene amount of financial support" — essentially, money to help Amazon sell Nintendo games and consoles cheaper than Walmart could. The request moved up through Nintendo's sales team and eventually landed on Fils-Aimé's desk for a final decision.

What Was the Problem

Amazon wanted Nintendo to give it special pricing that would let Amazon beat Walmart on Nintendo products. Fils-Aimé told the Amazon executive that doing this would be illegal and would damage Nintendo's relationships with other stores like Walmart. When Amazon kept pushing, Nintendo made its choice: it stopped selling Wii and DS systems directly to Amazon.

At that time, Nintendo was selling around 10 million DS handheld systems every year across North and South America. Cutting off Amazon meant losing a huge sales channel — and this happened right when the Wii console was in the middle of its peak popularity. It was a costly decision.

Why This Matters Legally

What Amazon asked for breaks antitrust rules — the laws that stop companies from acting unfairly to crush their competition. The Robinson-Patman Act specifically says manufacturers cannot give special price deals or money to one retailer if it's meant to give that retailer an unfair edge over rivals. That's exactly what Amazon was asking for.

Nintendo's legal team was right: the Federal Trade Commission has been enforcing these rules for decades. Manufacturers have to treat their retail customers fairly, or they end up in legal trouble.

The Context: Amazon's Early Days

In the late 2000s, Amazon was pushing hard to become the place where people bought everything, not just books. The company was willing to lose money on things like video games and electronics to attract shoppers and build its market share against traditional retailers like Walmart.

Think of it like this: when a new coffee shop opens on your block, it might sell coffee for half price for a few months just to get customers in the door and away from the existing café. Amazon was doing something similar across many product categories — using cheap prices and financial pressure on manufacturers to build its hold on the market.

The broader context here is that we've seen this pattern before. During the early days of the internet in the 1990s, venture-backed startups burned through investor money to undercut established stores and grab market share, betting they'd become profitable later once they'd won customers over.

The Relationship Recovered

The gap between Nintendo and Amazon didn't last forever. By 2012, the two companies had worked out their differences enough to announce partnerships around the Wii U console, including services like Netflix and Hulu Plus. This suggests they found a way to work together on digital services — like streaming — without running into the same pricing problems that sank their physical product relationship.

What This Tells Us Today

Fils-Aimé's story is worth paying attention to. Most of these kinds of high-stakes negotiations between huge companies happen behind closed doors, in confidential meetings, and if they break down, the two sides usually sign non-disclosure agreements and move on quietly. Rarely does a former executive go public with the details the way Fils-Aimé did here.

His account shows how Nintendo has stuck to its principles over the years: it's been willing to give up access to major retailers and distribution channels rather than agree to pricing deals that could get it into legal trouble. That same approach shows up in how Nintendo works with app stores and gaming subscription services today.

Amazon faces much more regulatory scrutiny now than it did in the 2000s, especially around how it runs its marketplace and treats third-party sellers. Fils-Aimé's disclosure offers a rare window into how these negotiations work at the highest levels — negotiations that shape what you see in stores and online.