Square Enix: It is Critical to Produce Titles that Speak to the Global Market - News
by William D'Angelo , posted on 01 November 2022 / 4,008 Views
Square Enix President and Representative Director Yosuke Matsuda in the 2022 annual report for the company says it is difficult to achieve growth for companies that primarily focus on the Japanese gaming industry and it is important for Square Enix to offer games that will be more popular on the worldwide market.
"Achieving major growth in the game industry is difficult now for companies that compete primarily in the Japanese market, given its graying demographics," said Matsuda. "As such, it is critical for our business that we produce hit titles that speak to the global market, which offers greater scale in terms of both customers and sales volumes.
"Furthermore, game development efforts are becoming more sizable and sophisticated as the result of technological advancements in the devices on which they are played, such as consoles or smart devices. The investment required to develop game titles is therefore an order of magnitude greater than in the past.
"In other words, the Japanese market is no longer sufficient for achieving a level of earnings that enables us to recoup our development investment and generate a profit, and we therefore need to approach our development efforts based on the assumption that we have to succeed in the global market.
"Another change is how easily accessible information on games has become for our customers. We find ourselves in a world where social media spreads information instantaneously, enabling customers the world over to simultaneously obtain the same information on games through a variety of different devices and outlets.
"For our Group to better focus on developing titles for the global market in this changing environment, we need to concentrate our limited resources on the development of strong and robust titles. We need to enhance our presence in the global market by quickly establishing an organizational structure that enables us to consistently roll out high-quality content produced through selective and focused resource allocation, which requires the revamping of our title and studio portfolio."
Square Enix sold off several of its western studios - Crystal Dynamics, Eidos Montreal, and Square Enix Montreal - to Embracer Group for $300 million earlier this year. Square Enix Montreal has since been rebranded as Onoma.
Matsuda said these studios "focused on the development of major titles, which presented the risk of a serious cannibalization of our Group’s financial resources over the medium to long term." This is why Square Enix decided to sell off the studios.
A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012 and taking over the hardware estimates in 2017. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel. You can contact the author on Twitter @TrunksWD.
More Articles
Persona, Yakuza, Final Fantasy, Nier, etc get the vast majority of their sales overseas, so yeah it is important. But that doesn't mean they have to be less Japanese to be appealing to the western audience.
True, appealing to WW market is not the same as losing sight of who one is.
Exactly. Persona, Yakuza and Nier were all niche franchises that stuck to guns and still ended up mainstream anyways. People even said that the Souls games would never be popular unless they added an easy mode yet they didn't and Elden Ring still sold over 16 million copies.
I hope the realize that the "global market" buys SE games entirely because they are Japanese games for the Japanese market, and not for any other reason. I hope they don't try and be more like western developers. There is nothing wrong with western developers, it's just that there are literally thousands of them. Why try to copy a saturated market instead of doing what you do best. Customers aren't stupid, they know what they want
Oh the irony xD
Makes me wonder if this is a major reason why FFXVI is taking a more action-based approach to gameplay to appeal to a wider audience. Although I'm sure it doesn't help SE financials in keeping their biggest IP confined to a single platform at the same time ;)
FFXVI isn't releasing on PC day one. I remember when the initial trailer was released, it said that it was, but SE retracted it saying it's only on PS5 for an unspecified amount of time.
It's a different time now than when FFXV released. More Japanese games are releasing on Xbox now than the Xbone gen ever did, and if more Japanese games are released, the more players are willing to give them a try. Can't grow a player base if you don't release your games on a platform. True that about the Switch though. It would probably have to be Cloud based (FF pun) Crisis Core on Switch is most likely a miracle by itself.
More games are releasing but are they being played?
And downloading them from gamepass and never touching it on the backlog does not count.
Last update I saw for Persona 5 Royal was on October 25th where the game was #10 most played on console, #7 on PC (Xbox app on Windows) and #7 on Cloud. Best performing JRPG has ever had on Game Pass. So yes, they are being played. Definitely worthwhile for a platform that is not historically been great at Japanese games.
But when talking about profit... have those games been bought?
So, more Marvel games?
Maybe they shouldnt have selled tomb raider ip then at first --"
Im pretty sur this ceo is gonna bankrupt them (I exaggerate a little) but he keep speaking about nft, doesnt make game improve in computer, most of their port on pc are always half bugged, with low fps framerate, look like star ocean, mixed review on steam, not because of the game himself, but because it run like shit, waited 3 years to make a patch for nier automata, still didnt fixed chrono cross.
Honestly, if this wasnt for ff, dragon quest , nier and kingdom heart, i wouldnt even care if they go bankrupt. + they are overpricing their game. 79e Forspoken, a new ip, tell me they arent out of touch with the real.
The selling of expensive Western studios with IPs that generated low profit, and the issue of making games that appeal in Japan and beyond, are mutually exclusive. Keeping the TR IP wouldn't have negated what SE is saying here, nor would it have helped (in the state it had been under SE at least)
It is rare when a company admit clearly that they only focus on profit.
I have no doubt of it, and their partnership with Sony have provided a lot of success globalwise.
Didn't they try that and admit they were wrong around the time of the original Bravely Default?
Seems like SE is thinking a decade late than every other major 3rd party JPN publisher. But no surprise: the JPN market alone is not not enough for AAA budget 3rd party titles, save for Monster Hunter. It's part of the reason Yakuza pushed into China and then the West last gen.
I don't really think so, they already release a lot of games that have WW appeal, perhaps they are late in cutting out what doesn't sell?
It's a gentle dance with that, if you focus too much on Western game mechanics you can lose that Japanese charm a lot of jrpg's have.
For sure! Look at how huge Persona is after going multiplat. A franchise that is unapologetically Japanese. It's been an insanely huge success! P5R is my first ever Persona game and it's been an insanely fun experience, albeit with some growing pains since I have very little JRPG experience lol. I still find it amusing how legitimately shocked Sega was when Atlus ported Persona 4 Golden to PC in 2020 and it turned into a massive success.
The important thing is that Atlus made a JRPG that was really good and focused on what made the franchise good to begin with. SE has the creative talent. Their leadership though, makes you question what the future holds for the company.
And you got thumbs down for knowing Persona 5 released long ago and sold a lot, and it haven't turned a success just now kkkkk.
Persona 5 released in PS3, re-released in PS4, got the royal "full priced DLC", and then got PS5 version again full priced.... still overselling the Xbox version by a country mile even if supposedly it would be the first time the Xbox fans would ever see a release of the game. Gamepass truly increases the sales of games, on other platforms.
Essay Pro