Xbox 360 steals Tokyo Game Show

Microsoft riding high on new popularity of RPGs for its platform

by Brian Ashcraft

The biggest announcement at the four-day Tokyo Game Show 2008 (Oct. 9-12) at Makuhari Messe convetion center in Chiba Prefecture was not for a Japanese title and not by a Japanese company.

On the first of the two press days, Microsoft exec John Schappert announced the Xbox 360 title “Halo 3: Recon,” a game that was rumored to have been pulled from Microsoft’s announcement lineup earlier this year at the Los Angeles game-industry event E3. “Halo 3: Recon” is an expansion of the wildly popular first-person-shooter “Halo 3,” and will be out in North America next fall. While Microsoft’s “Halo” franchise is a juggernaut among Western gamers, the series has had a tepid reception at best in Japan, where first-person-shooters aren’t as popular. The reason for announcing such a Western-centric title at a Japanese event was simple: Free press.

Microsoft has traditionally had a tough time in the Japanese market. When the console launched in 2005, unsold Xbox 360s collected dust on store shelves. Japanese gamers griped that the games were “too Western” and didn’t appeal to their tastes. It was a dreadful repeat of what followed the Japan release of the original Xbox in 2002.

Flash forward to August this year, when popular Xbox 360 role-playing game “Tales of Vesperia” caused the console to sell out across Japan. It was so extreme that Microsoft Japan had to release an official apology for the inconvenience to consumers and retailers. A price drop followed in September, which, coupled with more Japan-friendly role-playing games, has caused the Xbox 360 to be in demand like never before.

In years past, Japanese gamers have shown little enthusiasm for the Microsoft booth at TGS. But this year, there were long lines almost comparable to those at the Sony stand. Microsoft strategically placed its booth, packed with a staggering 140 demo kiosks, right across from venerated Japanese game-maker Square Enix, which was one of the must-visit locales of the show. Gamers hoped to get a glimpse of the new trailer for Square Enix’s in-Japan PlayStation3 exclusive “Final Fantasy XIII” (the game will be released on both the PS3 and the Xbox 360 in North America and Europe but, oddly, only on the PS3 in Japan). Microsoft has secured several other Square Enix-developed role-playing titles, such as “The Last Remnant” and “Star Ocean 4,” each of which were playable at TGS, if you wanted to wait in line for 90 minutes or more. Western-created role-playing games such as “Fallout 3” and “Fable II” each had waits of an hour, something that would have been unimaginable five years ago.

The keynote address delivered by Square Enix President Yoichi Wada was short on announcements and news (there wasn’t any). Instead he pointed out how Japan has lost its position as the worldwide video-game leader. “It’s true,” Wada admitted. “We’ve lost it.”

From the mid-1980s until recently, Japanese companies dominated the video-game world, but have since lost that stranglehold as Western game-development technology has leaped ahead. In the panel discussion that followed, Wada conceded that “overseas games are very well made” and said that “time is running out” for Japanese companies to catch up.

Not only are Western game-development tools more advanced, but overseas studios are getting faster at churning out big, multimillion-dollar projects. For example, the Microsoft-published “Gears of War II” is being released only two years after the original game, noticeably faster than the three- or four-year cycle it’s typically taken Japanese companies to release big titles.

The gap between Western and Japanese game developers is getting bigger and bigger, Capcom Japan producer Ben Judd points out.

“I really went into TGS hoping to see something that convinced me otherwise,” said Judd. “That didn’t happen.”

He should know, as the action title Judd’s currently producing, “Bionic Commando,” is being developed by a Swedish company for Capcom.

While Square Enix is just starting to warm up to the Western market by releasing titles directed toward international audiences on the Xbox 360, Capcom has really led the way. Not only has the company promoted non-Japanese game producers such as Judd, it also hired American and European studios to make games for an international market.

This year’s TGS, Judd said, has convinced him that Japanese companies need to start working more with Western developers and find out how they can combine their game aesthetics and detailed craftsmanship with the efficiency and programming strengths of the West.

Easier said than done. The metabolism of the game industry is notoriously slow, and with games typically planned years in advance, it’s difficult to suddenly switch corporate culture.

“There seems to be a consensus here that Japan is falling behind the West, but also some resentment at the fact that the only way to overcome this is to modernize, or even to Westernize, their business practices,” says Dewi Tanner, overseas business manager at NanaOn-Sha Co., the developer behind the “PaRappa the Rapper” music games.

Until now, Tanner believes, it was possible for Japanese game companies to focus solely on the domestic market. But with the budget for large-scale games reaching tens of millions of dollars, that just isn’t possible anymore. To survive and compete with Western game makers in a global market, companies must change.

“Unfortunately, apart from The Beatles, Hollywood stars and perhaps a weeklong honeymoon tour of Europe, most Japanese have a very limited knowledge of international culture,” said Tanner. “They are aware of this, and it makes them nervous in multicultural situations. Obviously there are exceptions, and Japanese individuals with international mind-sets are finding themselves in very high demand.”

Some Japanese companies, such as Capcom and Sega, have already adapted to the changing market. Capcom has balanced its release schedule with big-in-Japan multiplatform titles such as the “Monster Hunter” series and international favorites such as “Resident Evil 5,” which has been confirmed for the Xbox 360 and PS3.

Sega tapped the knowhow of Dallas-based developer Gearbox Software to create the Wii music game “Samba de Amigo” and an upcoming tactical-shooting game based on the “Aliens” movie.

Even though Square Enix’s Wada says time is running out, others are more optimistic.

“I don’t think that people are down, to be honest,” says Tatsuya Minami, president and CEO of PlatinumGames Inc., a startup Osaka studio that’s signed a deal to produce games for Sega. “I think that from a systematic production standpoint, Western studios have been more successful as of late, and Japanese developers are recognizing this. However, we aim to be just as successful.”