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Sega, Capcom, Konami “Dump Consoles for Phones, SNS”

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Top Japanese game companies such as Sega, Capcom and Konami are reported to be drastically scaling back their releases of games for console platforms, whilst drastically scaling up their output of games for mobile phones and social networking services.

Sega has said its releases of console titles will drop from 66 in 2010 to 56 in 2011, whilst it will expand its releases of games for smartphones and social networking sites from 6 to 39.

Capcom is reducing its home console releases to 55 in fiscal 2011, down by 17 titles over the previous year. It too has announced a series of high profile SNS and mobile game releases.

Konami is keeping the number of its console releases stable, but has increased its social and smartphone game releases by 20 over the same time last year.

Square Enix also seems to be following a similar strategy, and has a distinctly unimpressive console line-up for 2011.

Even Atlus has been dissolved and is now only a brand owned by a mobile phone software development company, with predictable consequences for its releases.

The (business) appeal of free to play games designed for casual users is succinctly described by the CEO of Electronic Arts:

At the end of [2011], the digital business is bigger than the packaged goods business, full stop. No questions in my mind.

Then, you know, I think that we’ll find ways to even sell our packaged goods content in chunks and in pieces and subscriptions and micro-transactions.

Our highest ARPU (average revenue per user) are free-to-play games among paying users. You think about that and say, ‘how can a free game be the game they pay the most for?’

We have people who are giving us $5,000 in a month to play FIFA Ultimate Team. And it’s free. Dirty little secret.

In the face of such a huge number of imbecilic rubes shelling out vast sums for the crudest games seen for decades, it is no wonder they are keen for their share of the revenues.

However, unlike EA many of the major Japanese game companies seem to be having a great deal of difficulty keeping pace with the international gaming market – whereas EA and company appear to be hungrily entering a new market, the Japanese companies instead seem to be fleeing both their lack of success overseas and a shrinking domestic market.

Unfortunately, producing even fewer home console games and instead pinning their hopes on developing awful mobile and social games only seems likely to accelerate the atrophy of their remaining competitive strength, and the decline of the Japanese gaming market as a whole.

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134 Comments

  • I haven’t seen anything here I haven’t seen before. The phone market it growing rapidly, anyone could have told you that. Of course game companies are going to jump on the wagon. As for all the crappy lineup’s and loss of games, 2011 for me is going to be epic. I have a list of games I cannot wait for. None of them are for a phone. I’ve seen plenty of years where companies have hardly put out anything, or they put out shit. That doesnt mean its doom and gloom. Don’t abandon the industry now because the time’s changing, it will right itself.

  • I hope you guys know that these games – the casual fare – are what finances your big budget HD games.

    And it’s funny, because those same big budget HD games are the cause of the problem themselves; they cost so much to produce, that it takes a crazy amount of sales to break even.

    See Ubisoft and Red Dead Redemption for example.

    Nobody is forcing you to play these games, however, you should know that they play a vital part in the industry (nowadays).

  • i dont think most people here have seen the mobiles Japan has. Fricken badass monster phones. They are pretty big too (people watch TV on them), if the game companies actually tried a decent phone game is possible

    and i dont see how capcom will ditch consoles when its got monster hunter. P3rd just sold 4 million copies in 1 month =)

  • Hardcore gamers will be playing on consoles/PC doesn’t matter what,so they’ll keep the development for it.
    I hope the casual/social games crap helps to take casual gamers fags out of the consoles,then,we’ll have more quality titles made for hardcore gamers,and not all this shit we usually see(specially games without challenge, made for casual fags that don’t have capability to learn how to play a good and complex game).

    Casual fags,please,GTFO and go to your fucking phones!!! LMFAO!!!

  • oh well due to high cost productions and barely making any profit(unless it’s a known IP) are one of the reasons why japanese companies are making few console games every year. in fact with the upcoming release of 3DS and PSP2 i might not be surprised if japanese companies will concentrate more on handheld, not only it prove to be profitable in japan, but it’s much easier to develop and can make quick cash.

    i already have tons of games i wanna buy from my consoles(PS2,PS3,Gamecube,Wii,PSP,DS) and the upcoming 3DS and PSP2, i might not even buy PS4 or the next nintendo console.

  • $5000 in a month on a free to play game…. insanity. And whoever did that and others like him or her are total fools. And it’s thanks to those witless idiots that all this is happening. Human stupidity has no bounds to its power to change the world for worse.

  • We have people who are giving us $5,000 in a month to play FIFA Ultimate Team. And it’s free. Dirty little secret.

    …………………………………………………. Someone Wants the server to live lol

  • The HD console era has not been a smooth transition for Japanese devs (it doesn’t help that HDTV adoption in Japan has been slow because of cost and living space). I sure a lot of them wishes they were still developing for the PS2.

  • This is either because tons of people have or are getting a smartphone or because those games can be made faster and cheaper or both. I had a feeling about the future of gaming ever since the current consoles were released. It wasn’t good or bad, it was just a feeling.

  • The biggest problem is most cell phones do not have a proper D pad.
    Also I hate no despise social network type games farmville has to be the stupidest thing ever.
    Personally I’d like the use the history eraser weapon from Startrek Voyager on Mark Zuckerberg.
    I’m pretty sure nothing of value would be lost.

  • They really REALLY want to bring down their economy.

    What is this dumbfuckery? First anime, then manga and now games?

    Japan..the mobile phone sector is a one-way ticket to nowhere. It’s a dead horse. An afterthought. A gimmick.
    It’s casual blind-dating.

    But go ahead, kill yourselves. We fucking told you.

  • I remember Carmack talking about this a few years back. He could sit down, by himself or with a small team, and crank out a game for the iphone in no time. Reminded him of the good old days of game development.

    Low budgets, small teams, but high potential sales makes for a promising area for many developers.

    • Distribution costs next to nothing and the iphone hardware is not that bad it’s main short coming is the lack of a proper input device for gaming.
      Having only a touch screen and gravity sensor makes for poor game play for many types of games such as plateformers and fighters.

  • Sega has long been a mere shadow of its former glory and has been hard at work to ruin all successful franchises it had with horrible entries.
    So good riddance perhaps, though I`ll shed a nostalgic tear for them.

    EA will still put out their usual sports line-up which is about all good they ever came out with and make good money as a publisher/distributor, but seeing their difficulties to put out working versions lately showing a severe lack of quality control on their side after cutting their project budgets and employee numbers people might be forgiven to think of that as a cop out to dodge ruining what little of their reputation they still have left while taking some safe bets with crappy browser gameame equivalents.

    Konami surprises me a bit, but between 2-4 yearly yugioh game titles, the card game and updating/remaking their franchises on handheld systems they can make a lot of easy money until they recover some of their early creativity.

    It worked for nintendo after all during the years where pokemon and handheld sales where enough to keep them alive while sega caved in.
    Looking at nintendo now, they surely won`t complain missing a few years playing it low to strengthen their company for their big comeback, which is something I can see Konami pulling off as well.

    Surprised Capcom didn`t pull in line as well though, it sounds lite it would be right up their alley as well.

  • “We have people who are giving us $5,000 in a month to play FIFA Ultimate Team. And it’s free. Dirty little secret.”

    So basically their entire profit model is based around the mentally defective.

  • Sadly, this was bound to happen. Today’s generation wants convenience at the palm of their hands. Why pay $50 for a game on a console if they aren’t really keen on video games to begin with. They just want a quick distraction when they are bored on the go. Sort of like paying for a “Massage” session just for a BJ cause yer too stingy to pay for the entire thing.

  • Bronxdragon says:

    Wtf. I think someone needs to go back in time and destroy the cellphone….or at least kill the guy who thought it was cool to put games/internet and other crap up there besides basic PHONE stuff.

  • Well, it doesn’t matter to me, I’m pretty much done with modern games anyway. It’s all macho bullshit anymore, where you can’t die or explore, you only press a button to make explosions every once in a while. That, or it’s a meaningless MMO grind world.

    Lucikly there’s more than enough older games that I haven’t played to last me a lifetime.

  • There’s a few things to consider here. This isn’t necessary a correlation. Console titles are extremely expensive to make, cellphone games are fairly cheap.

    You gotta remember that Gameboy games were often made by one dude who did art, music, code and design. With the 3DS and PSP2 as the current handheld target, you basically need a similar team to the one you had when you made games for the PS2.

    Cellphone games, even higher end ones, can still be made by a fairly small team and generate real revenue. Realistically game developers are always going to make console games, it’s just that you will be seeing more and more cellphone, iPad games in the coming years because they’re really a good business move.

  • I don’t care if they bring fewer but better games out.
    And the money milked by crappy low budget games for smartphones will enable to create better big-scale games for console – If they’re actually successful…

  • Horrible news. The phone market is already glutted as it is, this isn’t sustainable for any of these companies. The thing a lot of these companies switching over also forget is that Apple’s market dominance is being quickly overtaken by Android phones, which don’t have standardized specs and are so harder to develop for. This is the wrong approach for these companies, what they should be doing is investing in high quality AAA console titles. Capcom, for instance, had its best profits when RE5 and SF4 came out, but this past year those profits disappeared when they made an overly-Japanese-style Lost Planet 2. Sega had a potential great franchise with Valkyria Chronicles, but instead stuffed the sequels on the PSP, which seemingly no one outside of Japan still plays. Konami could stand to make another Zone of the Enders game, how awesome would that be.

  • Producer: “We creates games for platform and consumers don’t consume and even pirate it. Fuck this shit, I’m getting bazooka.”

    Well, our hope is Doujin games like Recettear and free games like Elona.

  • Its where the money is. Last fiscal year, Zynga was the #2 publisher in terms of profit, passing up EA and other big names, because of Farmville. Its very cheap and you can make massive profits… so why wouldn’t companies jump on this bandwagon? I just hope that it becomes too saturated for it to really turn a profit soon.

    • It reminds me of the whole wii thing. Lots of publishers went of making party games and forgot one important thing. The *casual*gamers are already content with one or two games a year. I gues History is repeating itself again…

  • lol japan you need to share your manga and anime a lil more and I think other countries will share there games a bit more… its he whole back scratchin deal….greed gets ya no where. we all want great Anime, Music, Manga, and video games

  • They’re going to cut out the games they think are least likely to make money. MML3, MGRising and whatever Sega has coming are still going to be published and it’s doubtful that these ten or so games that aren’t released will scar the video game industry. In other words, nothing of value was lost.

  • NNNOOOOOOO!!!! First the global economic recession happens, then the Tokyo ban happens, and now this! The world is just giving me one great big “fuck you!” after another! Sure this has been slowly happening like an infection that’s ever so slowly spread in an effort to kill the concept of quality video games for good, but fuck I rage every time it’s mentioned!

    FUCK! With my luck the games that were “scaled back” would probably exclusively contain all of the ones I actually anticipated… Or they’ll be cancelled as a result of the Tokyo ban (either one)…. Just plain fuck me! Everything I like is dying and there’s absolutely fucking nothing I can do about it!(I live in America and can’t stop retards from supporting mobile phone/social networking games…)

    It’s all making me a very negative person…

    • Anonymous says:

      Perhaps it’s time to look away from the bright banners of the large companies? Quality games aren’t dead, they’re just less marketable these days. If you’re willing to dig, it’s possible to find indie games/studios that could pique your dying interest.

      Granted, it could take a LOT of digging.

    • Give it some time. The rehashed games will get reproduced better as the programmers refine their cell phone programming. Who knows? Maybe Zun will start redoing Touhou for cell phone use in a decade or so.

        • there are no way of see the bullets in a 2inch screen, without say that is nearly impossible be accurate in a touchscreen.
          if plain made cellphone games they will need new hardware, like the old n-gage(the phone, no the failed plataform for the n-series), was a wonderful platform, but they fail in the games, the developers don’t liked the idea of a phonesole, BTW has good games like sonic n, rayman 3, worms party, tomb raider and more.

          and now than I remember, I have a good sonicwings/aerofighters like game on my nokia 6630… fire storm is the name…..

    • It’s not hard to trace the reasoning… EVERYONE (ok, nearly everyone) have a smartphone, opposed to a very slim margin of the population equipped with consoles.

      Not only that, the average user have not been subjected to years of gaming, so for this market re-rashing crap is a goldmine that requires little to no development.

      It is also a LOT less complicated working the entrails of a game for the mobile market as opposed to a full console with it’s delicate SDK.

      Casual gaming is the only gaming we will have in a couple of decades by the way… Farmville be damned for starting the conquest 🙁

      • Anonymous says:

        It’s not necessarily a death knell for “real” gaming. It’s quite possible that more indie and small-time devs will come to the fore. Simply because you don’t NEED to put a good effort into phone games does not mean that some groups will half-ass their product.

        Also, look on the flip side, it’s possible that this could be the start of a new cycle of indoctrinating the young into the next generation of gamers. “Hardcore” games really aren’t accessible to those who lack the skill to play them, and the number of gamers from the NES/SNES/Genesis/What-have-you era isn’t getting any larger or more accessible.

    • Precisely akuma2002. I currently have three phones (2 I no longer use). And what’s on these phones? Connect Four, Pac Man, Xevious, Street Fighter II, Block Breaker, Brick Breaker, Total War: Medieval, Galaga, and Final Fantasy. How many of us have played these games already in the arcades or at home on the computer or gaming consoles? And my cell phone service carrier is offering other favorites as well: Sonic the Hedgehog, SOCOM, Tekken, 1942, Grand Tourismo, Leisure Suit Larry…the list goes on. And I get these games on a regular “dumb” phone, not a “smart” phone.

    • Well if you guys really love your games as much as you say you do go out there and buy console games before it’s too late!!
      I sure as hell am, I’m not gonna let a single generation of newfags ruin my lifetime of gaming!!

      • Yeah but I doubt the 4~5 milions buyers of MHP3 are gonna like their hunting on a touch screen.

        It’s not because the biggest money is made on casual gaming that core gaming is dying.

        The gaming market has grown bigger than the cinema market since 2006. With a market of this size there is room for many different kind of games sold in many different ways.
        I think we still represent a large quantity of buyers, I mean, I don’t see any casual gameplay in Monster Hunter ! And editors will find it’ll always be interesting to invest in games for us.

        Also, It’s actually a good thing that the market is dividing ! This will allow editors to have a better appreciation of what each kind of clients really wants so they can deliver exactly what we’re demanding (that when they’re not slumping to hell like Squenix).

        Anyway, the future of gaming probably lies in the indie market, those are small projects that actually tries to inovate (for the better or for worse) and once an indie have some success, a new big studio/company may rise to make nice games for us.

      • Wow. The decline continues. First from PC Games to Console Games, now from Console Games to Phone Games and other micro-transaction stuff.

        I wonder how console gamers are going to feel now that the shoe is on the other foot?

        • Comment by Kuraudo
          08:19 16/01/2011 # ! Neutral (0)

          Yeah, I’ve been leaning towards the PC (Dragon Age, The Witcher…) for awhile now the only title I don’t regret buying for my PS3 is MGS4 and that’s out of Demon Souls, VC, Assassin’s Creed series, etc

        • Good riddance. Honestly, the people developing for pc now are the best we’ve ever had creating some of the most involved games ever seen. The best part? Their small time operations are making decent profits with no console ports in site. I hope all the crappy companies which haven’t made a decent title in years move to mobile phone gaming; herd needs thinning.

          Pc gaming is dead, long live pc gaming!

        • This is nothing but terrible news, no matter how much people try to sugercoat it up, it’s fucking bad news like how some country’s lake is being drained due to people stealing fresh drinking water from it to sell back to those people they stole it from for money when it should be free…

          Whatever, I am more concerned about Capcom doing this then any of the other game companies listed, how dare they…

        • you know I’ve had an idea for while, one of the big company bought up a bunch of game engine designers and then just made custom game engines.

          I’m not talking about unreal were every game looks like it was made with the unreal engine I’m talking about is a company that solely makes game engines.

          They modify them for the people who need them
          they work off the base engine for every game title unless specifically asked to create something that looks different
          and then they’d sell it to a whole bunch of others game Studios

          Where most of the money is spent in videogames is on the engine creation itself, after that is creating all the three models and shit.

          And even then another companies just there to create models for basic things like cops glasses light fixtures physics for posters picture frames doors doorhandles doorknobs outlets things that are just everywhere, this would let the videogame companies focus on just making the things that are specific to their game.

          Let’s say there are 100 games made a year, there is a lot more but let’s just say 100 for now. 25% of these use this engine service. Now creating a total game engine that say that costs $20 million for one game engine, that one big company like rockstar makes for their grand theft auto, but this is an engine that gets modified for other people for other games. Let’s say the engine itself costs them $30 million a year to maintain and keep employees and all that shit

          30 million divided by 25 is 1,200,000, that’s how much it would cost per game per engine license for breaking even that say they sell for 2 million they come out with a significant profit while the game companies themselves can unload a huge necessary costs.

          This way we have cutting-edge graphics physics and its overall cheaper to develop games.

          Granted something like this will never happen but if if every company goes over to cell phones and people still want hard-core games something like this would need to happen.

        • You all know how it goes; as I paraphrase that speedy kids’ response to his mother in ‘the Incredibles’: “When everyone is “special”, than nothing is special”.

          That seems to be where our gaming is going now….

        • [quote]there will be no Bayonettas (pulling a random game, insert whatever you want) just because there are people willing to make them because no such studios in the future WILL BE ABLE TO AFFORD TO MAKE THEM.[/quote]

          You know, the most fun games come from times where game studios had the same budget as the amount of pocket money your average college student gets. The indie market is still alive and kicking as far as I can tell.

          [quote]with the migration of the big studios and publishers goes the migration of the big studio and publisher money.

          there will be no cutting edge graphics, physics, or whatever else you’re expecting to continue because no one will be able to afford spending years developing the engines.[/quote]
          We are making games, not Hollywood movies.
          Games = fun first, everything else later. The most fun I’ve ever had with games was in the 256 color era.
          Besides that, nobody in their right mind would develop a new engine from scratch for any new title their make. Sure, cutting edge 3D/game/physics engines are expensive, but there are plenty of OSS (open source software = free and legal to everyone) alternatives. Some of these tools are widely used in commercial development.

          [quote]once the hardcore “proper” game studios essentially become equivalent to modern indie studios, few will have 50-70 million dollars to spend on a game, even if they are willing to make it.[/quote]
          Most of that is advertising costs. And only a few AAA titles are ever worth advertising to the general public.

          [quote]what general hardcore gaming will become is what the PC adventure game industry became.
          the ones that tried to approach modern levels of technology still end up looking unpolished and 5-6 years too late.[/quote]
          What’s wrong with 5 year old graphics? I still play 10+ year old titles that need arcane magic to work on modern operating systems and they are just as fun as they ever were.

        • “As long as there are real gamers who will want to play proper games there will be people who are willing to make them.”

          the PC adventure game genre still has developers willing to make them but right there is pretty much a look into that future if it comes to pass.

          there will be no Bayonettas (pulling a random game, insert whatever you want) just because there are people willing to make them because no such studios in the future WILL BE ABLE TO AFFORD TO MAKE THEM.

          with the migration of the big studios and publishers goes the migration of the big studio and publisher money.
          there will be no cutting edge graphics, physics, or whatever else you’re expecting to continue because no one will be able to afford spending years developing the engines.

          once the hardcore “proper” game studios essentially become equivalent to modern indie studios, few will have 50-70 million dollars to spend on a game, even if they are willing to make it.

          what general hardcore gaming will become is what the PC adventure game industry became.
          the ones that tried to approach modern levels of technology still end up looking unpolished and 5-6 years too late.
          and these days most have even given up on that, preferring to simply spend their money on what they can control on their budget, and their games have reduced to early 90s levels of technology.

          graphics/physics/etc aren’t everything obviously, but the point is the will doesn’t equal the ability.
          when the money to create epic hardcore gaming titles disappears, so will the epic hardcore gaming titles.

        • Goddammit this is depressing. I mean the hardcore gaming scene. Dudes who pretty much burned most of their lives on gaming. Thousands of dollars per person on new games/consoles/merchandise. Real fans who got them where they are now, and all they have to say is “Gee thanks, for your time and money, but we’re gonna go and try to make shitty games that EVERYONE and their dog love. Bye-Bye!”

          It’s time somebody who loves games and has a business sense go and start a game company that doesn’t just cater to casuals. Casual games are all well and good, but when it takes from the core market, you gotta wonder why they can’t figure out they’re clients don’t trust them anymore.

        • It’s easy to say that now, but 10-15 years from now who knows if there will be a decent number of quality games produced at all. If it becomes far more profitable to make 100 terrible casual facebook games than to make even 1 decent game who will be left to make the decent games?

          Look at the state of music, do you know anybody that doesn’t complain about the main stream music scene today? Pretty much everyone is trying to be like everyone else, and that’s because it’s what sells the most cds. Sure you get the older bands that made it big still releasing stuff from time to time, but the genuinely new and tasteful music is few and far between; and it usually gets bastardized by record labels or never picked up at all and phased out.

        • As long as there are real gamers who will want to play proper games there will be people who are willing to make them.

          The producers of ridiculous yearly consecutive sports games, crappy Hollywood adaptations and all types of shitty spin-offs are moving with the market. Boo-hoo, big loss.

          Quality games will persevere.

        • @ TFish
          Still there are more bands going for niche genres than bans in mainstream pop genres.
          Thats how it is. And who would do that? Gamers for instance. Artist for instance. Why do you think people like the creator of street fighter left capcom and made his own company? Because he wants to make the games he likes, not the games some stupid manager prep tells him too.

          I wouldn’t worry too much.

        • Coming soon:

          Everyone will use Mobile phone to play games.

          Suggestions:
          Japan game companies shld combine and make its own phone(Joint Venture, make one company – one phone) with lots apps(games) to fight Apple.

          Allow people to make games for free but the games sold will be charged with fee(%) with each download.

          Preferly = Japan, Korea, China + Europe

          World vs USA

          I really hate Apple products, Money-suckers.

          Cant even make a single Apps for free, need pay a fee to make Apps? WTF?

  • Blame pirates.
    If a company can work its ass off to make one game that gets stolen in abundance, then why should it bother?
    If it can find a greater profit with less cost and lower chance of theft, then do you really think it’ll choose to pander to iBandits?
    Effeciency is the name of the game. It always has been.

    • Your comment doesn’t even make sense. No one forced game makers to go into Cold War class escalation with run away budgets for every single game. Is every film released a $100 million plus budget?

      Maybe they are not making great games, even though they put a lot of money into production.

      Maybe games should focus more on fun instead of graphics.

      Derp.