Wow, 2013 was the varied year for the game industry in Japan. Gungho, became a juggernaut with Ragnarok Online, went semi-dormant and rose again with Puzzle Dragons. Classic JRPG developer Neverland closed down, much to the disappointment of fans. The Playstation 4 lands in Japan this February, as Japan seems like it’s finally learned how to cope with the pressures of PS3 quality demands. Who’s likely to emerge strong this next year? Here’s my personal take:
1. Pachinko Profiteers
Most notable example(s): Sega Sammy, SNK Playmore, too many to list.
Why did Sega buy Index Corp for US$100 million? Creating Atlus IP-based gambling machines is listed at #3 in this press release according to Eurogamer, but ranking-wise it should be reason #1. While Index went bankrupt due to other failed ventures, Atlus was able to chug along in the black releasing quality games with reasonable budgets and most importantly, getting those games out to their foreign fans. Gambling revenues are nothing to scoff at. According to SNK Playmore’s investor relations page, Pachinko and Pachi-slot pull in 19.3 Trillion Yen or 28.4% of all recreation spending. Obviously, not all of it goes to the developers, but enough does to keep a number of developers afloat.
2. Lean Mean Fanservice Machines
Most notable examples: Shanghai Alice, Nihon Falcom
Nihon Falcom could write a textbook on the care and feeding of fans. Their music has been some of the best the industry has ever seen and they milk that fact for all its worth. Live concerts with their JDK Band, more arrange albums than any other soundtracks on earth, art contests, they engage with their fans in all manner of ways. They create all manner of content outside of their games; who knows, maybe the total volume of content they’ve created outside of games has exceeded the content they’ve created for games. This type of survivalist is all about making the most of their Intellectual Properties, building smaller, more profitable products that satisfy their fans.
3. The Evolved
Most notable examples: Score Studios, Silicon Studios, possibly Konami, Aiming Inc.
Some people got the memo that times are changing and to meet the growing demands of next generation development, some companies are powering up their pipelines, making tools easier to use, bridging their tech gap with -gasp- middleware and getting with the times so to speak. Treating tools as investments to be reused, prototyping to find the fun before wasting employees weekends making changes that really shouldn’t be made right before major deadlines. The Evolvers have a much better chance at creating top class, polished products that compete in the global marketplace, though I’m sure that there are some companies that will still try to brute force their way to the AAA market.
4. Bubble Riders
Most notable examples: Gungho, DeNA, Gree
There’s always bubbles in any market and someone will always manage create a bubble. The first and best are always the ones to prosper when new genres or platforms, etc become one big shiny thing to get consumers to part with their money. Gungho has ridden 2 big bubbles so far, the MMO bubble with Ragnarok Online and the Smartphone Games bubble with Puzzle & Dragons. Whether or not they will survive depends on the size of the bubble and level of hubris the company has in regards to planning for government regulations, popularity fallouts and other bubble poppers.
5. The Just Plain Lucky
Most notable examples: Square Enix, Capcom
When gambling with lots of money in AAA, some game companies are taking serious gambles at blockbuster movie studio levels, only without German tax shelters. The luck won’t necessarily come this year; being lucky enough to have a hit to milk or continue to be able to milk said hit are both due to luck in Japan. In the expensive West, sequels tend to be thought of ahead of time as they’re what will make the money back on the investment on infrastructure to produce the first game. Such planning ahead is almost unheard of in Japan.
Gaijin Dev: “Hey Taro, we’re going to localize Farming Sun 2 right? Have you made sure the UI can handle English?” JP Dev:”Why would I do that?” Gaijin Dev: “Farming Flame Sun sold 4 times as many copies in America than it did in Japan.” JP Dev:”I just used the old UI before localization from FFS1 again.” When working with minds that brilliant, just about anything good these days is a stroke of luck.
For indies in Japan, they face the same great odds as other indies do. Drowning in the flood, advertising a game while building it, having a zero marketing budget, crowd funding is starting but it’s considerably farther behind than it is in the West. And whatever you do, don’t be lumping doujin games in with indie. A lot of doujin developers will use others’ IPs and make fan tributes, like Aja Games Koumajou Densetsu: Scarlet Symphony. While some are certainly professional quality, hitching a ride on others’ IP without permission is a humongous risk. Maybe not in the case of Touhou, as IP owner Zun being an indie himself is fairly lax; but if he ever exercises his right to crack down, I would not bet against Zun.
I meant to post this on New Years Day, work doesn’t like me having free time. What a pain in the neck, literally.