TOKYO — Hiroshi Yamauchi, who transformed his great-grandfather’s playing-card company, Nintendo, into a global video game powerhouse, died on Thursday in Kyoto, Japan. He was 85.
The cause was complications of pneumonia, the company said.
Mr. Yamauchi, who led Nintendo from 1949 to 2002, was Japan’s most unlikely high-tech success story. Named president of the family business at 22, he steered Nintendo into board games, light-emitting toy guns and baseball pitching machines — fruitless forays that he later attributed to a “lack of imagination” — before the company arrived at arcade games.
Its Donkey Kong and the original Mario Bros. became hits and gave rise to Nintendo’s wildly successful home video game business.
The Nintendo Entertainment System, a console first released in Japan in 1983 as “Famicom,” unseated early leaders in the video game industry, selling more than 60 million units thanks to shrewd marketing, close attention to product quality and a crop of games based on unlikely yet endearing characters that soon became household names.
In 1988, The New York Times wrote: “Many Nintendo best sellers, like Super Mario Bros. 2, are based on wildly preposterous premises, this particular one being two mustachioed Italian janitors who endure various trials, such as dodging hammer-swinging turtles and lava balls and man-eating plants, in order to save a Mushroom Princess. No matter. Kids can’t get enough of the games.”
Under Mr. Yamauchi, who professed not to understand video games, Nintendo went on to dominate the business. When a successor machine was released in 1990, fans camped outside electronics stores for days in anticipation; it sold almost 50 million units. Next came the Nintendo 64 and Nintendo Game Cube home consoles, as well as Game Boy hand-held machines. Nintendo dominates the list of all-time top-selling games.
In the early 1990s, Mr. Yamauchi found himself in the middle of an international dispute when he offered to buy a majority stake in the Seattle Mariners. The team, established in 1977, had been threatening to leave Seattle if it could not find a new owner willing to keep it there. Nintendo had its United States headquarters in Seattle.
The team’s owners approved the deal but the commissioner of Major League Baseball, Fay Vincent, and a four-man M.L.B. owners’ committee initially opposed it. They relented and approved the sale in 1992 after Mariners fans and the Seattle news media rallied in favor of it. In 2001, the Mariners signed the star Japanese outfielder Ichiro Suzuki, now with the Yankees, helping to open the door for many more Japanese players to join major league teams in the United States.
In a show of his characteristic detachment, however, Mr. Yamauchi confessed at the time that he was not much interested in baseball, either. He said he had never gone to a baseball game and is thought to have never gone since. One of his few hobbies was the Japanese board game Go, which he played at the master’s level.
Hiroshi Yamauchi was born in Kyoto on Nov. 7, 1927. He was raised by his grandparents after his father, Shikanojo Yamauchi, deserted the family.
The Yamauchis had been makers of hanafuda cards, a Japanese playing-card game based on flowers, since 1889. Once favored by the elite, it became popular as a gambling game, often played by Japanese gangsters.
Mr. Yamauchi joined the family business in 1949 after his grandfather had a stroke. He moved quickly to take control at the company, forcing out a cousin and later purging officers appointed by his grandfather.
But the playing-card business was in terminal decline, and Mr. Yamauchi shifted the company’s focus to one toy after another until he found success with video games in the 1980s. He was helped by the renowned video game designer Shigeru Miyamoto, who joined the company in 1977 and created Mario, Donkey Kong, The Legend of Zelda, Wii and other products.
Mr. Yamauchi developed a strategy that set him apart from other consumer electronics manufacturers in Japan. From early on, he farmed out the production of Nintendo’s video game machines to smaller suppliers, allowing the company to maintain a relatively small staff and low overhead costs. Nintendo approved only a handful of games each year, whether designed internally or by outside companies, ensuring that prices and profit margins remained high.
There were some misfires under Mr. Yamauchi’s watch. The company’s cumbersome, headache-inducing Virtual Boy portable console — a red box on legs with rubber visors that players peered into to play games in 3-D — was a flop. And beginning in the late 1990s, first Sony, then Microsoft steamrolled into the gaming market with new consoles — the PlayStation and Xbox, respectively — challenging Nintendo’s dominance.
Mr. Yamauchi stepped down in 2002 — “I have no energy left,” he told reporters — and is credited with going outside the family to appoint a successor to steer Nintendo through rocky times. Under Satoru Iwata, the current Nintendo president, the company roared back with its Nintendo DS hand-held machine and the Wii home game console, though Mr. Iwata, too, has stumbled with the most recent hardware releases and is increasingly under siege by smartphone games.
Mr. Yamauchi’s survivors include a son, Katsuhito.
In one of his last interviews, with the magazine Nikkei Business in 2003, Mr. Yamauchi offered a longer view of the gaming market. At the time, Nintendo was being pummeled by Sony’s immensely popular PlayStation 2 console. But he scoffed at suggestions that the battle for supremacy in gaming was over.
“That’s absolutely wrong; the gaming wars, they will never end,” he said, adding: “That’s just not how this business works. Nobody knows what tomorrow will bring
Correction: September 19, 2013
A previous version of this article misidentified the type of Japanese playing cards that the Yamauchi family made. They had been makers of hanafuda cards, not karuta cards.