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Opinion: Reluctant skepticism about Japan's future Exclusive
Opinion: Reluctant skepticism about Japan's future
September 24, 2012 | By Kris Graft

Japan's video game industry is under heavy scrutiny, from business and creative angles. At the end of Tokyo Game Show, Gamasutra EIC Kris Graft questions whether the Japanese industry can return to its former glory.

Getting a grasp on what exactly is going on in Japan is a difficult task for me, because well, it's on the other side of the world and I don't exactly have frequent face-to-face contact with the Japanese game industry. It doesn't help that I speak virtually no Japanese, which has made my time here during Tokyo Game Show interesting!

I'll be honest -- I don't have that much more direct experience with what's going on with the Japanese video game industry than Gamasutra's typical reader. Every now and then, we'll see the occasional quote from an outspoken critic, like former Capcom figurehead and Mega Man co-creator Keiji Inafune, who accuses Japan's industry of being creatively bankrupt. But those soundbites don't get down to the root of the problem.

Shin Unozawa, a long-time Namco Bandai executive and the head of Japan's video game trade body CESA (Computer Entertainment Software Association), made an effort to convince a group of media and professionals at Tokyo Game Show that there is nothing to see here; just like in the U.S., Japanese companies are struggling to increase their online sales mix, and just like here in the U.S., the lagging physical retail sales numbers that are widely reported do not accurately represent an industry that is going increasingly digital.

He called for game publishers to be more open with their digital sales figures, citing a few examples of "traditional" Japanese game publishers making some money on digital sales-reliant games like Fire Emblem and the new version of Phantasy Star Online 2. The message was that people should be optimistic about the Japanese game industry. Publishers have good and bad years, but overall, the Japanese industry is holding steady, he said. Things are changing, things are improving.

I entertained his sentiment. "Why are we always talking about the struggles of Japan as if its struggles are exclusive to that region?" I figured. Surely there are plenty of examples of creative bankruptcy on this side of the world, and examples of poorly-run businesses. The West has had its share of layoffs, of studios shutdowns, of floundering video game stock. We're all in the same boat, right?

It'll all be alright... right?

I chatted briefly with Game Developer magazine editor-in-chief Brandon Sheffield, someone whose knowledge of the inner-workings of the Japanese game industry are second-to-none in U.S. game journalism. He's worked with Japanese game companies in some capacity for the last seven years, and I often mistake him for a dainty, stylish Shibuya club-dweller. Anyway, he knows a lot about Japan, among other things.

I bring up my theory that really, the West isn't that much better off than Japan, right? That we needn't compartmentalize and segregate the "Japan problem." Plus, it's gonna get better over there, right? Right?!

Brandon put his hand on my shoulder and said gently, "No, Grafty. Japan is fundamentally screwed and it will only get worse without a massive shift in corporate culture." [Paraphrased] He then floated away and I woke up, realizing that he's not in Japan with me right now. But dammit, he was right.

The reason is well-documented. It's the culture; a culture based on the robotic efforts of salarymen, as opposed to the visionary impulses and ideas of creatives. A culture where you need to stay at work and warm your seat longer than your boss, lest you earn his wrath. It's about the paycheck, about stability, and in the end, about playing catch up instead of being innovative.

What's worrisome, then, is that isn't changing, not within the old guard of Japanese game publishers. And if culture is at the root of the issue, this insidious problem could infect newer Japanese game businesses that are dealing in emerging markets such as mobile games. I saw this firsthand following an evening interview appointment at a company's office in Tokyo. I worried that I was keeping one very helpful PR rep around too late. He laughed, and said it's okay. His boss was in meetings, and this isn't the kind of company where you leave work before your boss does, anyway.

ninja-gaiden-z.jpgInafune told me at TGS this week, "In the U.S., it's more about the individual. In Japan, it's more about the company." It's ironic that he recognizes this, yet partners his independent studio with monolith Japanese game publisher Tecmo Koei, a "company" if there ever was one, for the upcoming Ninja Gaiden Z. He says the creative vision is his, and you know, I believe him. At the same time I'd love to be a fly on the wall and see just how much influence "the company" has over the development of that game.

I grew up on Japanese games, just like a lot of Gamasutra's staff, and just like a lot of our readers. I worry about the state of the Japanese game industry, I worry that Japanese companies are still too worried about mimicking successful Western games, or creating these homogenous, bland experiences, instead of embracing the "Japanese-ness" that so many people still love.

I read Wall Street Journal Asia this weekend. Its report on Tokyo Game Show talked almost exclusively about just two companies: Gree and DeNA, the country's mobile and social game juggernauts. There are innovative things happening there, and they are finding success with games that look and feel Japanese, not just locally, but on a global scale. That's encouraging.

Other, more "traditional" game companies like NanaOn-Sha, Platinum, From Software, and Grasshopper Manufacture also embrace their Japanese aesthetic. They make the games they want, and have found a global audience. Are they reaching Call of Duty-scale commercial success? No, but they're staying true to their creative vision, and people appreciate that immensely.

But what of the Japanese game industry's health overall? What of the future of companies like Sega, Capcom, Konami, etc.? Even with the success of Gree and DeNA, the old guard of publishers is still, of course, a major component of the industry. CESA can show us graphs, it can highlight a few games from traditional publishers that are doing okay in terms of digital sales, it can implore the media to look on the bright side. I want to believe that Japan can overcome the challenges, but just taking a small step back and looking at the situation dispassionately, I need to agree with the critics. It's the culture that is slowly but surely strangling large swaths of the Japanese video game industry, and there's no real end in sight.

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Alfe Clemencio
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Meanwhile the Japanese indie game market is growing with every semi-annual (kinda) comic market. It where indie games have 2 hour line ups. Games like Recettear and Chantelise are found on store shelves in box form and are still run by art-house-like developers.

And on a nearly regular basis you see a few of those games end up on the PSP or PS2 and the like back in the day. This is not counting La-Mulana and Cave Story.

E McNeill
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I always hear about the salaryman culture, and it sounds awful to me, but then I wonder: how did the creative stuff ever happen? By what process did the original hits of Nintendo or Grasshopper Manufacture or Suda51 or Team Ico ever come to be?

Kevin Oke
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I've worked with several large, longstanding Japanese companies in pitches and prototypes, and the creativity was tremendous, but there was also a ton of attention paid to adherence to process and "rules" of development.

Kevin Oke
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In the corporate culture the big problems are the extreme aversion to risk, that trumps any desire to be innovative, and the glacial rate of change. For example, clinging to the "employment for life" idea and madogiwa zoku (corporate deadwood) doesn't help the creativity or the bottom line in times like this.

Also the culture doesn't value entrepreneurship or maverick-ness as we do in the West, which ties in to the group-think mentality. Part of this mentality leads to top companies in industries purposefully treading the same tired ground as so to not outpace their close competitors too much and potentially put them out of business (I can't recall the term for this at the moment). I can't say if this is happening in games, but it does exist in the business culture.

Duvelle Jones
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@Kevin Oke That is not something that I would believe is a problem is unique to the Japanese corporate culture, it is something that effects any corporate structure that has been established in any medium for a long period of time. At some point that has to stop, or change if you a part of something that is deemed creative... but any the start of that, unless it's a top-down solution, there will be resistance to change.

The question is, how much?

Brandon Sheffield
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I asked some guys this question once! The answer was, pretty unanimously - when you pressurize something hard enough, it can become a gemstone. most of the time you just get dirt and rubble, but sometimes you get a diamond.

Essentially they're under so much crazy pressure that they sometimes create something amazing as an outlet for that pressure.

the last time I was in japan, I went out for drinks with a couple heads of two japanese companies that are both quite popular in the west. one of them invited us to visit his studio, since we were relatively nearby. He had to *move his bed out of the way* for us to get in the door. This says several things:

1) this is an office, and he was definitely planning on sleeping there and working more when he worke up, even as he was talking about his publisher not having paid his milestones *for a year.*

2) his entire staff was still working there, at 1 am when we went in. His bed being in front of the only entrance meant that employees would have to leave before the boss, which is frowned upon without an excuse, or literally step over his prone body in order to leave.

To talk about your Suda example, he is a business man primarily. In creating odd, unique content, he knew what he was doing there - it was a bid to make people notice his company, and it was a rare risk for a business man. But it was a calculated business decision that drove creative decisions.

With Team Ico, that really was a team that was able to do something different, but it's incredibly rare for that to happen. Consider Keita Takahashi talking about making Noby Noby Boy, as he did at GDC two years ago. He was talking about how executives were glaring at him as he walked down the hall because he wasn't producing something that people could identify - he was experimenting and trying new things because he had generated a hit product in Katamari Damashii, but then once he got to do what he wanted again, resentment abounded, and he ultimately left the company.

The crazy pressure of their environment, which is comparable to AAA crunch in the west *but all the time* can create some interesting things sometimes, but generally it squashes creativity and gets people to just do their jobs, or gets people to totally lose it, as Matsuno did after FFXII, or as you see in Ono (of street fighter)'s interview with simon parkin. And when you combine that with the fact that japanese game companies are still independently solving the same problems western companies have collectively solved long ago, you see why the AAA industry there might decline.

E McNeill
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Wow, thanks for such a comprehensive answer. It feels so odd that a creative career in a fresh medium could sound so... inhumane.

John Gordon
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I think the main difference between Eastern and Western developers is that Eastern developers are more honest about problems inside their industry. Western developers try to pretend everything is peachy keen, and then one day a company suddenly lays off a bunch of employees. That's the moment you find out something is wrong.

Alexander Symington
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While I enjoyed the article, I definitely wouldn't agree that the Japanese work environment is lacking in creativity, at least outside of the larger publishers. I also find it somewhat inappropriate that GREE is implied to be a counter-example to this: regardless of their financial success, their actual games are incredibly formulaic and dull. GREE is essentially Japan's answer to Zynga.

Dedan Anderson
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"Inafune told me at TGS this week, "In the U.S., it's more about the individual. In Japan, it's more about the company." It's ironic that he recognizes this, yet partners his independent studio with monolith Japanese game publisher Tecmo Koei, a "company" if there ever was one, for the upcoming Ninja Gaiden Z. He says the creative vision is his, and you know, I believe him. At the same time I'd love to be a fly on the wall and see just how much influence "the company" has over the development of that game."

No contradiction there - basically inafune said a generalized statement which may be true or not but just saying it doesn't mean it's fact. Then if you think only japanese companies influence creative decisions - wow.

Johnathon Swift
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"the robotic efforts of salarymen" is what's gotten to the US as well. Make a new Call of Duty, Halo, Fable, and Madden each and every damned year or your fired. The people actually good at making games are chucked out in favor of loyalty, experience, and delivering the latest in time for the holiday season.

Which is why many are quitting big name publishers. Microsoft, Activision, EA, Ubisfost. All are as guilty as the next. I guess the one exception is Take Two. Their problem is of course greenlighting games that are in ultra high competitive genres without pushing that ultra high competitiveness. Nee Spec-Ops and Max Payne 3. Whatever your story is a game is still defined by its gameplay, and shooters are far more than oversaturated.

wes bogdan
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As most here i grew up through the great crash and saw nintendo save gaming while playstation dragged it from mom's basement to the living room.

We all grew up on final fantasy,metroid ,mario and zelda but for the most part on japanese games then 3d arrived and a game called doom set the course on shooters for pushing graphics foward and suddenly chrono trigger and the like were banished to handhelds and no one cared about japan because everyone was so adhd they only play online cod.

I still love jrpg's and find single player generally more satisfying than a quick online bout-online still hasn't reached story mode class because it's 15min horde,deathmatch,capture the flag,team deathmatch etc and imo has a long way to go if you want a non mmo online driven story even warcraft is go here kill this and loot.

If not for japan this industry might not even exist so i find it disheartning that disgaea,pattapon,locoroko etc are nowhere near cod ,ac or borderlands sales wise.

When i have the option i always use the original japanese with english subtitles as it enhances rpg's or is just more funny hearing the original voices in disgaea as things can be lost in translation.....though i wouldn't expect gears ,halo or cod in anything but english.

I did use german in the psp kz and i thought it fit perfectly .though most would just expect english

Brandon Sheffield
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Killzone is a Dutch game, not German.

Emmanuel Navarro
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Looking at the Japanese game industry in terms of sales numbers, it seems that much of the Japanese creativity these days has centered primarily on developing business models and gameplay mechanics that fit into these models.

Whether this is a good thing or not depends entirely on your point of view.

Chikara Ishikura
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I cannot agree with this report.
Because, I think that it is too simple an opinion that the cause of a decline of the game industry of Japan is in a Japanese corporate culture.
Probably, neither Mario nor Sonic was born when Japanese culture barred creativity.