According to MacDougall, game development is, by nature, dynamic. Relationships continually change to meet the needs of both manufacturers and publishers. "The disposition of this investment leaves us in a position to become even more aggressive in expanding our development capacity, both internally and externally. Aside from several partnerships already announced over the past year, we are currently in similar talks with several other prospective partners around the world."

In the past year, Nintendo has added emphasis on games which offer true innovation to video game players, and especially those with appeal to older players. Key current and upcoming NINTENDO GAMECUBE(TM) titles include Eternal Darkness: Sanity's Requiem(TM), Animal Crossing(TM), Metroid® Prime, The Legend of Zelda® and Capcom's upcoming Resident Evil series exclusively for NINTENDO GAMECUBE.

"Although we declined the opportunity to continue our exclusive agreement with Rare, this announcement does not diminish our respect for their work or the past contributions they have made to Nintendo," adds MacDougall.

As the worldwide leader and innovator in the creation of interactive entertainment, Nintendo Co. Ltd., of Kyoto, Japan, manufactures and markets hardware and software for its popular home video game systems. The systems include Game Boy®, Nintendo® 64, Game Boy Advance and NINTENDO GAMECUBE. Since the release of its first home video game system in 1983, Nintendo has sold more than 1.6 billion video games worldwide, creating enduring industry icons such as Mario(TM) and Donkey Kong® and launching such franchises as Zelda(TM) and Pokemon®. As a wholly owned subsidiary, Nintendo of America Inc., based in Redmond, Wash., serves as headquarters for Nintendo's operations in the Western Hemisphere.