Why the Japanese Game Industry is Dying

Why the Japanese Game Industry is Dying

News stories about the inexorable decline of Japan’s games industry are always hot. They pop up every week. It’s the End. Japan is Doomed. Even Capcom’s head of production, Keiji Inafune, says that Japanese-produced video games are in big trouble. Pretty heavy stuff to come from the mouth of one of Japan’s most respected game developers.

The supposed slow death of Japan’s game industry is particularly fascinating to twenty- and- thirty-something games writers who pored over game magazines through the ’90s and longed for faraway Japanese adventure titles and role-playing titles that would never make their way Stateside. It’s morbidly irresistible to watch as the former kings of the industry slide into ruin, and the games press can’t help writing about it.

But is the state of gaming really that bad over in Japan?

According to a recent poll by the interestingly-named goo Research and japan.internet.com, the answer is “No, not really,” coupled with a pause and a slow, reluctant “Well, yeah.” Japan still loves to game–but primarily with handheld systems and consoles dating back to the last generation. If the current trend continues, handhelds like the Nintendo 3DS will continue to thrive, but full-sized game consoles may well dwindle down to near-irrelevance.

The poll was conducted with a sample size of 1,099 respondents. The respondents involved covered a wide age group that included both males (53% of the group) and females (47%).

742 people in the group said they owned one or more game consoles. The Nintendo DS came out on top, with 62.1% of the group owning at least one iteration. The PlayStation 2 came in second at 58.5% .

Coming in third was the Wii, at 43.3%. And as far as the Top 8 systems go, that’s it for the current generation. The PSP was fourth at 31.8%, and the Super Famicom was at 28.3%.

The PlayStation 3 took ninth place at 22.5%. Xbox 360 took lucky spot 13 with 4.3%.

Microsoft’s failure to endear the Xbox and the 360 to Japan is legendary. The Internet is buzzing with rumors, facts, and half-truths that at least offer a general idea of why Bill Gates’ systems haven’t taken off overseas: The Japanese are motivated to buy products made in their own country; the Xbox was poorly advertised; Sony threatened retailers that initially advertised the Xbox; Japan’s not interested in first-person shooters and other “American” games; the shoddy manufacturing that triggered the Red Ring epidemic is completely unacceptable to Japanese consumers; and so forth.

So Microsoft’s lackluster performance in Japan isn’t a secret or a surprise, and if you look up the reasons why, you’ll be up to your ears in sales numbers and conspiracy theories. But what about Sony? It’s a highly-respected Japanese company. Why is the PlayStation 3 trailing so far behind?

The likeliest answer has less to do with marketing instead deals with Japan’s ingrained culture, which might prove hard to budge. Daniel Feit, a community writer for BitMob, explored the issue with a blog post he wrote last July titled “Japan Loves Old Games, But Not Older Gamers.”

Feit lives and works in Japan, where he’s noticed a clear reverence for retro games–one of the reasons Dragon Quest remains a monster hit in its home country–coupled with a mild disdain for any adult who has yet to actually “grow out” of gaming.

“I see an open affection for games in Japan that simply isn’t visible in the United States,” Feit wrote. “The famed electronics districts in Tokyo and Osaka (particularly the retro-game store Super Potato) aren’t just places to buy old games — they are elaborate ‘towns’ built on precious memories, with glimpses of gaming’s past in every alleyway.

“Yet a rift stands between remembering games as fun and playing games today. I can find any number of people willing to talk about video games they used to love. (…) However, should the conversation turn towards my current-gen console collection or my enthusiasm for the Tokyo Game Show, two little words suddenly dominate the conversation: game bakkari (“all you do is play games”). I have tried protesting, citing the fact that I have a full-time job and a family to care for so my gaming is limited to an hour or so after everyone else is asleep, but it doesn’t matter. An adult who plays video games is immediately pigeon-holed as some kind of oddity.”

Feit specifically cited his wife, who likewise frowns slightly on his small gaming sessions–but will spend hours with a sudoku game for the Nintendo DS. The key difference, Feit said, is that Japanese game developers have caused a widening rift between “TV games” and handheld systems by shifting their priorities to the latter (Dragon Quest IX being a perfect example). Handheld gaming is also private, which keeps any one family member from impolitely hogging the television set. “If I play a game at home,” Feit wrote, “that’ll be the only thing anyone can watch in the living room.”

Nostalgia is indeed a very lucrative business in Japan; legendary manga-ka Osamu Tezuka even explored the Japanese obsession with childhood memories and experiences in some of his works. But how will Japan’s game market survive if adults refuse to indulge in games, especially new games? It’s not feasible to wait while the current generation of children slowly buy up the PlayStation 3, create their own memories, and then return to wallow in them a generation or two later.

There’s no clear answer, especially since the state of Japan’s gaming industry has problems that go beyond nostalgia and consumer culture. The Japanese development process, for instance, is rigid and stifles creativity. Shigeru Miyamoto wasn’t a game designer when Hiroshi Yamauchi set him to work making a game for Nintendo (a little title called Donkey Kong), but things have become far more corporate and structured. Strangulation might follow if changes don’t occur.

It’s not impossible to imagine another Hiroshi Yamauchi rising up and over regulations and seniority to take the necessary chances that will zap life into Japan’s games industry. What will be harder to overcome is the seemingly widespread belief that “TV games” are not for adults, and that even the very act of playing them is self-indulgent. For better or worse, Japan keeps a bulldog grip on its traditions.

But again, it’s not impossible to believe that Japan’s perceptions will change. After all, the Wii is a big hit because Nintendo marketed it as a family gaming machine. What better way to dispel the idea that gaming is a selfish, childish waste of time?

Japan’s games industry isn’t ready for the final needle yet, but a lot will depend on how Sony, Nintendo, and yes, even Microsoft, promote their systems in the coming generation. Will future game console ads tailored for overseas show off mighty graphics and processing power? Or will they offer a humbler, more family-oriented experience?

The coming months and years hold the answers. In the meantime, if you’re ever in Japan, make sure you take a moment and absorb the country’s perfect tributes to Famicom gaming. The nation may be a bit obsessive about nostalgia, but it’s hard to resist: It does it so well.

About Nadia Oxford
Nadia is a freelance writer living in Toronto. She played her first game at four, decided games were awesome, and has maintained her position since. She writes for 1UP.com, Slide to Play, GamePro and other publications, and is About.com’s Guide to the Nintendo DS.

6 Comments

  1. First, let me say how flattering it is to be cited not once but twice in a single article, as that survey you mention is from one of my stories as well (that’s right, we’re colleagues in a freelance sort of way).

    I am of the opinion that no matter how stubborn Japanese society may be, video games will always be important in some way on a cultural level. Even if HD gaming never takes off around here (and that’s a big if, IMHO) the robust handheld market combined with the strong retro and arcade markets means I’ll never truly feel like a weirdo for loving games as long as I live here. Likewise, I’ll never declare gaming in Japan “dead” or “dying” because it’s so damn omnipresent.

  2. Nadia Oxford

    Thanks for writing the piece (and making the poll!), Daniel! I had heard several times that gaming is something that Japanese adults are expected to “grow out of,” and your blog post gave me some insight. Given Japan’s bustling market for game nostalgia, it kind of indicates that a lot of the population doesn’t want to leave gaming behind, even though it’s expected of them.

  3. Why is Japan’s game industry seem in a state of dying? Well its quite obvious…first of all japan’s game industry have been on a decline ever since the late 90’s. Another reason is the fact the generation that grew up playing video games have move onto other things. To put in plain english, their taste have change.

    So is the japanese game industry really dead? the answer is NO, and simpily because Japan still have a thriving arcade/amusement scene.

  4. First, let me say how flattering it is to be cited not once but twice in a single article, as that survey you mention is from one of my stories as well (that’s right, we’re colleagues in a freelance sort of way).

    I am of the opinion that no matter how stubborn Japanese society may be, video games will always be important in some way on a cultural level. Even if HD gaming never takes off around here (and that’s a big if, IMHO) the robust handheld market combined with the strong retro and arcade markets means I’ll never truly feel like a weirdo for loving games as long as I live here. Likewise, I’ll never declare gaming in Japan “dead” or “dying” because it’s so damn omnipresent.

  5. Japanese video game industry is far from dying ….
    Japanese game designers are dead though …

    I see many great games coming from USA , Canada, England and France .But all these great designers work for Japanese brands like Sony . For example Uncharted is maybe the best game out there , designed in USA by Naughty Dog .
    Naughty Dog is owned by Sony . So Uncharted is a Japanese game .

  6. “Naughty Dog is owned by Sony . So Uncharted is a Japanese game .”
    I wouldnt say that… We mean games designed by and for the Japanese… If it was written and programmed by Americans, its an American game, even if the Japanese own the company.

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