An analysis of the global decline of Japanese console development Part 4/4

This is the final part of the series analyzing the global decline of the Japanese industry and its root causes. Below you will find links to the previous entries in the series.

Part 1
Part 2
Part 3


Cost cutting methods:

There have been many facets to the struggles faced by Japanese developers in the 7^th generation. For one, there was the issue of rising development costs which needed to be kept down, and the complexities of developing suitable suite of tools, libraries and game engines to best showcase the requisite high fidelity demanded by consumers on 7^th generation hardware.

Countless many Japanese developers chose to overcome these issues by licensing third party engines for use in their projects. The most utilized engine for that purpose has been the Unreal Engine 3 suite, which on the surface looked like a very impressive piece of technology that could reduce development time, complexity and cost.

Unfortunately, as mentioned briefly before, this engine suite has notoriously been the centre stage for many troubled Japanese as well as overseas development projects. Among the majour Japanese studios Square-Enix was one of the earliest adopters of the suite as their own internal suit of tools were yet in too early a state to be able to support a full game release.

Square-Enix had also long been increasingly growing concerned with the rising costs and complexity of game development beginning as early as in the 6^th generation. Thus they had for a while been on the lookout for potential ready solutions to license. When they followed through on these long held plans they ended up setting a cautionary example as to the dangers of this approach as early as 2008 with the release of their spectacular sales and critical flop, Last Remnant.

After that title’s lukewarm reception Square commented that most of its technical shortcomings could be blamed on them trying to replace the need for a host of good developers with a licensed engine and ultimately the disadvantages far outweighed the benefits gained by that move.

Square subsequently abandoned the licensing approach and their next title Final Fantasy XIII was built on internal technology and was a technological showpiece as well are the next round of titles that Square is developing on the same suit of internal tools.

These valuable lessons were however not heeded by many in Japan, and concerned developers of the region became prolific users of UE3 for upcoming domestic and overseas developed titles, usually to a consistent disappointing outcome. This was especially the case with projects aimed to aggressively pursue the western market as perhaps it was assumed that the signature visual aesthetics of the engine were better suited to the tastes of the overseas market.

This is a worthy note to discuss as the issue of visual aesthetics, outside of lower production costs, was clearly a prime motivator for many choosing the UE3 suite. This, however, is also the Achilles heel of most titles developed using that engine because the signature grit, and yellowish brown palette hue unique to the suite is not a natural fit for the traditionally more vibrantly colourful art style of Japanese games.

The drabness of colour scheme and tendency towards brawniness in character model design cannot exactly be entirely blamed on the engine itself. As with any piece of software technology it is no doubt designed to facilitate a lot of flexibility, if one chooses to put in the necessary time and effort to capitalize on it.

Unfortunately, as the use of UE3 is often a symptom of a tight development budget, such extravagances have been ignored and as a result a staggering number of projects developed world wide on the engine suite bear some disturbing number of aesthetic resemblance to one another, to the point that games made using the suit easily stand out and advertise that fact, and not in any flattering manner.

In Japanese developed titles another likely cause for this is no doubt due to the sample assets delivered with the engine using a preset styling, and the Japanese developers who are eager to get a foothold in the west associate the aesthetic quality of that visual style with what the overseas market finds pleasing, and thus choose to employ it.

Unfortunately this acquiescence ultimately works against the end product as their visual aspirations of wanting to fit in among domestic overseas offerings also causes their titles to have difficulty distinguishing themselves among a large body of similar looking and feeling games. Choosing to imitate a visual or gameplay design purely motivated by what is determined to be most profitable often only results in a title being devoid of any artistic drive or identity of its own. Historically such practices rarely bear fruit and in Japan's case they have never been known to do so this generation.

Another flaw in the strategy of any Japanese studio hoping to put a good bid into a popular but fiercely competitive and crowded category in the overseas market is their conservative approach. Most of then they wish to succeed but are reluctant to be prepared to allocate the necessary development budget for a project and more importantly launch the property in the wake of a significant and far reaching marketing campaign.

Looking at market losers and winners emerging out of the crowded overseas niches it becomes clear that the winners have always been the ones with a competently developed product backed by a very lavish marketing campaign.

Among the myriad of failed attempts two good studios to take aside and use as a cautionary tale is Namco-Bandai and Tecmo-Koei. These are studios that have very aggressively and very clumsily attempted to target the western market by an equal number of outsourced and internal projects.

Putting aside the outsourced endeavours and focusing on the internal projects a clear pattern of problems emerges that are directly to blame for a title falling short. First visible trend is the result of a title clearly launching before it was ready to be so. This is a symptom of project managers desiring to have a good seller on their hand but not being prepared to allocate the necessary time or resources to see it to a satisfactory level of polish. As a result games are released that are not founded on inherently bad concepts as given enough time the developers could have polished a better title out of what was ultimately released, but were not given the opportunity to do so.

SEGA:

In the past few years SEGA was the odd one out by, in parts, sticking to the formula that had made Japanese developed games a success for decades. That is to say that they were developing and financing unique titles that were not trying to imitate titles in any pre-existing popular genres in the west. Their endeavours produced well received titles such as the internally developed Valkyria Chronicles and the Platinum Game's developed Bayonetta, Vanquish and MadWorld.

While SEGA has been known to prouce, or commission very worthwhile efforts yet they have gotten a few things wrong that have put a damper on their success. The list of factors working against them has been their properties being released in wake of very weak marketing campaigns, very unfortunate release date timing, and in case of the removal of content from Yakuza 3, a misunderstanding of the overseas appeal of their own offerings.

MadWorld’s unfortunate choice of platform hampered its chance for financial success, resulting in an outright sales flop. The much more sensibly chosen platform for Valkyria Chronicles proved to produce very modest sales for that title and moderate ones in case of Bayonetta and Vanquish. Thus the lack of overwhelming success at the end of these endeavours did little to convince Japanese studios of the viability of domestically developed games with an independent vision. Yet, at the very least some positive things about this approach should not escape our attention.

For one, Valkyria Chronicles was the beginning of a successful franchise for SEGA, and in keeping with current market trends the sequels did much better than the original, even though much of that might have been spurred by the move to make the sequels for a portable system.

In case of Vanquish and Bayonetta SEGA has expressed that their sales, while moderate, fell well within projections, with both hovering around the million units sold mark, which means they both turned a healthy profit for the parties involved.

What more, in all cases SEGA managed to establish new, critically acclaimed IP's where a potential sequel is likely to perform even better in terms of sales. Add to this the fact that by virtue of these projects being domestic productions they helped train the domestic staffs tasked with development gain some much needed experience developing on 7th generation systems. These experiences will help streamline production methods, costs and time for future projects. This is a benefit of unmeasureable value for any Japanese developer.

This is a very important effect to take note of as one of the hidden motivations for Japanese studios being reluctant to handle internal or domestic is due to their staff struggling with the complexity, both in terms of scope, as well as technology in addition to logistic challenges of efficiently managing the large team numbers required by development on 7th generation home console hardware.

Japanese developers traditionally ascribe to the art house approach to game development with little actual predetermined structure or direction at the onset, instead relying much on experimentation which stands in contrast to the more structured, feature and milestone oriented approach utilized in the west. Needless to say that the latter approach scales better in terms of team sizes while the former does not lend itself to it well at all.

Of course by diverting development resources to overseas developers who might be able to turn out a sequel in a timelier, more structured and economical manner Japanese developers are sabotaging themselves in two very serious ways. One, these cheaper produced sequels often fall short of expectation, underperform financially and hasten franchise demise instead of having the intended revitalization effect.

Overseas outsourcing of development for Japanese studios has often proven to be financially unsound in retrospect, but more importantly by diverting resources outside instead of investing that money in their own domestic staff Japanese studios are actually robbing themselves of the opportunity to gain some much needed experience with 7th generation development and improving on their production and management methods.

The rising stars:

Though much more remains to be said against the prevalence of current strategies that undermine the role of Japanese development in the world market, it is perhaps best to stop here and instead focus on what has been working right in Japanese development come this generation.

As mentioned in the early part of this series one of the contributing factors to the spiraling decline among two of the former triumvirate, namely Capcom and Konami, has been a mass exodus of talent.

Theird triumvirate, Square-Enix, has also lost its fair share of talent, such as Yasumi Matsuno and Hironobu Sakaguchi, but these have unfortunately not moved onto better things. Yasumi Matsuno did not establish a new studio nor did he become part of any after leaving Square and his subsequent life as a contractor has seen his much needed talent and vision go largely to waste.

Skaguchi did establish his own company but efforts such as Blue Dragon and Lost Odyssey spawning from the enterprise have had their fair share of problems and are not exemplary in any way. Their one standout title is The Last Story which despite quality or artistic ambitions is headed for a very dubious fate due to its unfortunate pairing with the Wii platform which has traditionally netted failure when chosen to play host to ambitious third party core properties.

In contrast, most of the talent choosing to divorce themselves from the increasingly suffocating management regime of Capcom have, however, fared much better. In the early 2000’s most of Capcom’s most talented creators were concentrated in the independent Clover Studio which was funded by Capcom. In 2003 Capcom began a wide reaching corporate restructuring that later saw to Clover Studio being disbanded and most of its staff ultimately chose to leave Capcom.

This mass exodus of talented individuals then went on to settle mostly into 3 large enterprises. These were Platinum Games, Tango Gameworks, and Ignition Entertainment’s Japanese studio.

The first of these to be established was Platinum Games, whose artistic potential was recognized by SEGA, who themselves were once, and in a much lesser capacity, still are an artistically progressive developer. This recognition of talent led SEGA to sign a publishing deal with Platinum Games spanning several new IP’s.

As mentioned earlier this deal resulted in some of the most interesting, and robust offerings developed on 7^th generation home consoles coming from Japan. They were not phenomenal successes, such as is most desired by former successful Japanese studios, but they were profitable and critically acclaimed which in this generation translates into great potential for future franchise growth.

Shinji Mikami, one of the most talented Japanese designers today, upon leaving Capcom worked together with Platinum Games for a while but his ultimate goal was to establish a similar independent studio to better meet his own personal goals. This he managed in 2010 by establishing Tango Gameworks, which then was acquired by the overseas based Zenimax conglomerate. As a result of this they are likely to enjoy a strong financial backing, and hopefully also the creative freedom that Mikami has always desired.

One of the goals that Mikami wishes to achieve by forming his own company is to establish an environment without creative boundaries in which he can mentor and foster the next generation of designer talent that will carry Japan into the future, such as his former employers and their management practices are clearly unwilling to do.

Though a Japanese company being funded with overseas funding is a bizarre, almost karmic reversal of one the contributing factors to the decline in the Japanese industry it is not unique to just Mikami’s enterprise, in fact this is growing to be somewhat of a trend.

Ignition Entertainment made a similar move prior to Zenimax when they decided to set up a studio in Japan and populate it with local talent having divorced themselves from their parent companies and out the lookout for new employment. The resulting studio came to be helmed by another Clover Studio talent and has recently finished work on its first title, the visually impressive and unique El Shaddai: Ascension of the Metatron, which will see western release this summer, hopefully with appropriate marketing campaign supporting it, and advertising the appeal of its unique vision.

Another rising star among the pantheon of Japanese developers, and one who certainly has both a unique style as well as personality is Goichi Suda of Grasshopper Manufacturing fame. He captured critic’s attention with his Capcom published 2005 game Killer7. He rounds out this list of Japanese developers currently working projects with overseas funding, and this time by way of EA games.

The unique value of the Japanese visionaries:

If one were to categorize the sort of game creator archetype that Goichi Suda belongs to one would ultimately come to the conclusion that his particular breed, especially of the ones that mainly and visibly work on the home console field, is one increasingly exclusive to Japan.

This particular caste which tally such interesting personas possessing such unique artistic visions such as Keita Takahashi, Fumito Ueda, Goichi Suda and Hidetaka SWERY Suehiro, among others, represent a sort of video game medium equivalent of the art cinema director, the so called video game auteur.

While the global videogame field had its fair share of such personas in the 80’s and early 90’s they became increasingly scarce and invisible in the west in tandem with game making continually morphing into a profit driven industrial process. The current reality of the home console market leaves little room for the influence of such individuals and their artistically laudable, but largely unprofitable vision. In Japan, however, there was as of the 6^th generation, thanks to the continued employment of the art house development process, still room for a large body of such individuals.

Among these Goichi Suda is an interesting case study for though his bizarre visual and design ideas have never translated into mass market success, yet these have managed to strike a cord with connoisseurs of the medium who recognize and crave such uniqueness and clear identity. Suda’s first moderate hit was the Wii developed title No More Heroes whose bizarre unrestrained story telling and visual style managed to draw the attention of some discerning western gamers who had grown fatigued of the increased homogeny among western releases.

This phenomenon of a hunger present for Japanese games with an unrestrained unique vision is important to take note of, for this has in the past been responsible for Japan’s global success and can still support it going forward if successfully catered to because currently, as opposed to the populist gaming niches, it is largely an underserved one.

While Japanese upper management have been busy trying to find a formula for imitating popular western aesthetics in order to increase sales some titles that were determined to be uniquely Japanese, damn be the consequences, have flown under the radar and managed to become much more notable commercial or critical successes in the overseas market. This they managed just by giving the market what it asks for and is ready to support, robust titles that are uniquely different.

These titles and their bold identities might only ever be able to generate sales up to around the one million unit range, but there is certainly a possibility to make a profitable dwelling there, and grow.

The desire for games with an unrestrained visual design is no doubt the cause for the quirky Bayonetta selling better and being generally better received than the more western geared Vanquish from the same studio. This phenomenon is also responsible for a diamond in the rough such as Deadly Premonition generating so much interest by word of mouth alone due to the bizarre nature of its design when just 5 years ago it would have been ignored because there were plenty more polished unique offerings up for grabs out of Japan.

Another game from a previously largely ignored developer whose unique identity attracted overseas players and went on to become a notable success by word of mouth is From Software’s surprise 2009 hit Demon’s Souls. This title, which was not even made with any localization plans in mind, but ended up being picked up for that purpose after import copies of it had generated a substantial amount of buzz in favour of its quality. Demon’s Souls ultimately went on to put the name of its previously largely unknown developer, From Software, into the mind of discerning gamers with much better goodwill than is currently reserved for any members of the previous triumvirate.

It is hard not to notice that there is a lot more excitement and good faith in place among knowledgeable gamers for From Software’s upcoming spiritual sequel, Dark Souls, than there has ever been for the fruits of the continued clumsy westernization efforts from former goodwill Japanese developers.

Games such as the upcoming, western developed, Resident Evil squad based shooter, the overseas outsourced Devil May Cry reboot, the next western developed iteration in the Silent Hill and Castlevania series, and the upcoming domestic developed squad based shooter from SEGA, in addition to a number of other similar efforts are ever met with apathy or frustrated grunts. In contrast titles such as El Shaddai, Dark Souls, Shadows of the Damned and The Last guardian are met with appetite and genuine excitement. There is a reason for this, the zeitgeist does not just want more of the same, and there is actually appetite in place for uniqueness and variety.

From Software's Demon's Souls stands as a good example of extravagant productions are not a necessary for critical or financial success. Demon’s Souls was a impressive and polished project that was made on a very modest budget, and was intended to break even with just a few hundred thousand units sold.

 This demonstrates that what is most needed in Japanese titles is a sound independent vision and a clear understanding that the title in production should be able to turn a profit at about a few hundred thousand to a million units sold.

 The phenomenal success of certain chart topping overseas franchises might spur Japanese studios to attempt to measure themselves by a similar stock. But if anything the last few years of sales data suggests that Japanese developers are much better served aiming for profitability by sales in the million unit sold region rather than trying to jump head first into the above 10-20 million unit selling blockbuster territory.

 As mentioned before the pool of titles trying to aim for that much coveted populist genre top spot is by nature very crowded with games that look and play very similar to one another and thus competition is fierce. When Japanese try to throw their lot into that same overcrowded pool by imitating their shallow interpretation of the conventions that makes it popular they do themselves a great disservice.

 Exactly because the overseas side of the industry is so polarized and trend based there is ample room left for the unique and different feel of native Japanese titles that do not adhere to the any tired trend. Of course in settling for the smaller niche of unique quality productions studios cannot hope to perform as well as the genre kings, but it serves Japanese studio executives to pry their eyes away from the handful of solitary success sitting at the top of the overseas sales pyramid and also bear in mind all the also-rans populating the base upon which these kings firmly seated.

 It also serves Japanese studios to remember that these days franchises can gain glory from very humble beginnings. EA games prudently chose to stick with the Dead Space franchise after the first one turned out to only be a moderate sales success. They knew from the critical acclaim that they had a good thing on their hand and the subsequent sequel turned out to be a much better seller.

 The goodwill of a portion of the zeitgeist might not be stuff of fame and fortune, but it is important to note that it exists, and if one recognizes and acknowledges it, and caters to it by appropriately sized productions then there is a future there. A future much brighter than the bleak spiral of decline overwhelmingly embraced by most Japanese studios, and the sooner they realize this fact then the better it is for all.

 In that regard I proclaim the old regime of westernization to be proven obsolete, proven to be fallacious and in dire need of being put to rest permanently. The idea of paying extra attention to western sentiments when developing domestic titles is certainly not a bad one. However, the approach so far taken has without a shadow of a doubt been misconstrued and dangerously damaging to the future prospects of Japan’s future in the industry.

 There has been a short few years since Japan seemed at the top of their game back in the mid 2000's with such unforgettable and influential masterpieces as Resident Evil 4 and Shadow of the Colossus. But this industry is fickle and suffers from amnesia, most veteran gamers are not yet ready to count their most favourite patrons of so many years out entirely and still patiently await from them a return to form. Unfortunately while waiting a whole new generation of gamers have got their first taste for this medium, and this they have with no benefit or knowledge of Japan's so recently firmly held legacy.

 There are now millions of gamers who have been enjoying home console gaming for years for whom names such as Capcom, Konami, Square-Enix and their ilk does not carry any substantial weight. Indeed why should anyone know the name of a developer whose output has suffered into mediocrity due to a lack of faith in their own ability. In developers that are content not comfortable creating new brands that are not awkward imitations of existing ones whose true nature of success they do not even fully comprehend. Developers whose names are but mere shells, because they do not even develop their own games, but leave that manufacturing task to the lowest bidder.

 The writing is on the wall, we have entered 2011 and the glory days of 2005 are getting closer to being a decade past which in this industry might as well be a century. The currently held approach to the western market as practiced by an alarming number of Japanese developers needs to be taken up for revision.