Nintendo offloads games distribution

The computer games market received further notice that the boom times might be over yesterday when Nintendo, the Japanese computer giant, said it would close its Hampshire offices with the loss of 150 jobs. Distribution was handed to a division of John Menzies.

The decision gives John Menzies subsidiary Total Home Entertainment control over Nintendo's UK advertising, pricing and distribution in Britain. It is the first time Nintendo has surrendered such control anywhere.

Dermot Jenkinson of John Menzies said: "It's a compliment that Nintendo have come to us. We will be trying out some new games before Christmas."

The computer games market has been undergoing a recession after the boom years of the early 1990s. UK sales of computer games fell from pounds 750m in 1993 to pounds 510m last year. Consumers hungry for the successors to Sonic the Hedgehog and Super Mario have been frustrated as they waited for new console technology to reach the market. Nintendo says its Ultra console should be available early next year at around pounds 200. The Sony PlayStation, a CD-based machine, is expected to hit the market in autumn along with the Sega Saturn. But reports that bigger, more powerful machines were on the way put customers off buying older, smaller systems. Retailers such as Our Price and Virgin were forced to cut prices to shift stock.

John Menzies said it will create around 100 jobs at a new distribution centre near Derby. Following closure of its Eastleigh offices, Nintendo will relocate its UK head office to London. Howard Lincoln, managing director of Nintendo UK, said: "The move is intended to improve efficiency of and breadth of distribution in the UK."