Special: The State Of Japanese Game Retail

There have been plenty of articles in the past pontificating on the Japanese game market. But very few seem to have taken things down to a granular practical level, by simply analyzing what is stocked on Japanese video game store shelves, and how it differs to what we see in North America. Obviously, all stores display games in different ways (just as you might see Target, GameStop, and Best Buy all prioritize and rack games differently in North America.) As such, the impressions in this article are taken from multiple sources, including the more kid/mainstream-oriented Toys 'R Us in Odaiba, and a much more 'hardcore gamer'-aimed Sofmap branch in Shinjuku. DS Shelf Domination Of course, those of you who have been following the Japanese video game charts of late will know that the Nintendo DS is dominating hardware and software in a significant way - often topping 200,000 hardware units sold per week, and with DS software dominating the Top 10. Well, the Sofmap store certainly had a decent selection of DS and Game Boy titles, though it was only one section, and wasn't particular bigger than any other system. But Toys 'R Us' layout really showcased the systems' popularity, with an entire wall dedicated to DS and GBA (and a few leftover GameCube titles also in there) - much more shelfspace than is given in similar U.S. stores. It's also interesting to note that exchange rates mean that DS titles, which were formerly significantly more expensive than U.S. retail prices, are now slightly closer in parity to North America. For example, the store's Top 5 DS titles were headed by New Super Mario Bros, costing 4499 yen ($38.25). However, third-party games are 4699 yen ($39.95), quite a bit more than the $30-35 charged in the States. PSP, Hanging In There? The PSP still had a respectable showing in the Toys 'R Us Odaiba store, and its standard game pricing appears to be 4699 yen ($39.95), which is very much on parity with U.S. software pricing for Sony's handheld. But overall, the PSP probably had half the shelf space or less of the DS in the Odaiba store. Even so, more than one variety of PSP bundle was completely sold out in the Sofmap Shinjuku location - along with every single variety of DS Lite. But the PSP hardware selling out seems like something of a rarity, and the PSP line-up in Japan, much like in the States, looks mainly like a handheld version of the PS2 line-up - it therefore seems very geared to the Sofmap-style hardcore gamer. In other words, titles such as Ridge Racers 2 and Tekken: Dark Resurrection are playing to established niche markets, but in a country where mascots are a mainstream, universal phenomenon outside games, the PSP seems to be lacking both compelling cartoon heroes and overarching appeal across demographics, as reflected by its current retail placement. In the States, this stark contrast seems less true, since mascot characters are associated with smaller kids, not universal appeal. Therefore, Nintendo is operating in quite a different, but still reasonable U.S. market position. Even in North American Toys 'R Us stores, the PSP and the DS have similar amounts of shelf space. Xbox 360 - Not Quite Dead Yet Now, given the news that Microsoft's Xbox 360 has sold less than 100,000 hardware units so far this year in Japan, and likely under 150,000 to date in the territory, one might wonder whether it would be impossible to find the hottest U.S. console in Japanese stores at all. It was actually fairly easy - there was a demo Xbox 360 unit set up at the Odaiba branch of Toys 'R Us, and a similar unit at Sofmap in Shinjuku, and a not insignificant stash of games in each. Of course, this was just one shelf for Xbox 360 titles, compared to three for PSP and five or more for DS (and no Xbox 1 games in Toys 'R Us at all!) But it is notable that Microsoft has managed to get such strong Japanese developer support for the first few months of its console. By a rough count, around 50% of the Xbox 360 titles displayed on Japanese shelves were developed natively, and around 30% of those are Japanese exclusive right now. These Japanese X360 exclusives include New Japan Pro Wrestling and newer games such as Zegapain XOR, and cost around 6599 yen ($55.10), incidentally, fairly similar to some PlayStation 2 game prices. But are these Japan exclusives going to dry up, if the horrid installed base makes it difficult to sell more than 10,000 copies of any one title? Quite possibly, though titles that are saleable in multiple territories, especially North America, will certainly continue to be produced. It'll be interesting to see how Microsoft discusses this issue in its pre-TGS press conference this Wednesday. Conclusion Finally, a couple of tidbits - naturally, PlayStation 2 games were the most plentifully stocked overall, and the sheer amount of Japanese-only games that are simply culturally inappropriate for Western release is sometimes easy to forget for those who live in the U.S. But it was interesting to note how relatively swiftly even PS2 games moved to the bargain bin. In this case, it was the 'PlayStation 2 The Best' version of Ratchet & Clank: Up Your Arsenal, which was released in that form in August 2005 (with extra eyebrows for Ratchet!) - and you can guarantee that many games that are much older than that are still on shelves in U.S. Toys 'R Us stores. Quicker inventory cycling seems like a boon, overall, as long as there's somewhere down the Japanese retail chain to get older titles - which there is, in secondhand game stores. It was also intriguing to note that not all publishers are treated equally - in this and other Sofmap stores, there's a specific Square Enix shelf which stocks just the publisher's own titles, complete with a monitor playing trailers of the latest games. It's unclear (at least to me) whether Sofmap does this because Square Enix games sell so well for them, or whether it's some kind of negotiated commercial consideration. But it's interesting to note nonetheless. Overall, it's clear that the Japanese retail market is exceptionally vibrant right now, with the DS' impressive sales boom still in full effect. But how will the hardcore 'otaku'-style market and the mainstream DS crowd reconcile in the long-term? It's going to be fascinating to find out. [Gamasutra and Game Developer magazine editorial director Simon Carless will be reporting from Tokyo all this week, both before and during Tokyo Game Show, on the state of the Japanese video game market, looking at the state of the industry from multiple perspectives.]