The Japanese games industry appears to be in the midst of a slump, with sales last fiscal year plunging and Japan’s overall share of the worldwide market shrinking to just under 20%, along with a precipitous 15% decrease in the size of the domestic market, reports Enterbrain, publisher of famed gaming magazine Famitsu.
Japan has long been the mother country to many of the biggest companies in the games industry such as Nintendo, Sony, Sega, and many others, much of them critical in the development of the video game industry since the 1970s.
However, the proliferation of European and American game developers in the last decade has not been matched by the Japanese gaming industry, and Japan appears to be shrinking as a video game giant, at least compared to years past.
In the 2007 fiscal year, the Japanese market size was ¥687.95 billion ($7.63 billion), shrinking significantly by over 15% to ¥582.61 billion ($6.4 billion) in 2008.
Previous years were kinder for the Japanese market, but foreign markets, namely Europe and America, did increase in proportion to Japan.
As a result, the current Japanese share of the games market (including console, online, cellphone and PC games, plus hardware) does not even exceed 20%, a “complete turn-about from the age of the Famicom and PlayStation”, says Enterbrain.
This could be tied to a cyclical lack of vigor on the part of the Japanese markets of late, though a possibly less reassuring explanation might be long term demographic changes, or changes in consumer taste.
Certainly companies worldwide must also be feeling the impact of recent economic downturns, and PC games being included in the figures might skew the issue somewhat (Japan basically ignores the PC as a gaming platform) but as the world market share of Japan shrinks one has to wonder what changes will occur to Japan’s once tight grip on the world of console gaming?