According to Square Enix, the Japanese market is no longer sufficient to recover development costs and generate profits, so we need to look at the global market.
According to what Square Enix wrote in its 2022 annual report, the Japanese market is no longer enough to re-enter the development costs of video games and make profits, so we need to look more and more to the international market.
Square Enix’s words actually photograph a situation that is now very clear, for which local markets are no longer sufficient for medium-large productions, which must necessarily address the wider global context. SEGA itself has repeatedly cited the successes of its Yakuza and Persona series outside of Japan in its latest economic report , a sign that the great Japanese publishers are now looking beyond the domestic market ..
But let’s read precisely what is written in the Square Enix document : “Achieving major growth in the game industry is difficult now for companies that compete primarily in the Japanese market, given its graying demographics. As such, it is critical for our business that we produce hit titles that speak to the global market, which offers greater scale in terms of both customers and sales volumes. Furthermore, game development efforts are becoming more sizable and sophisticated as the result of technological advancements in the devices on which they are played, such as consoles or smart devices. The investment required to develop game titles is therefore an order of magnitude greater than in the past. “
“In other words, the Japanese market is no longer sufficient for achieving a level of earnings that enables us to recoup our development investment and generate a profit, and we therefore need to approach our development efforts based on the assumption that we have to succeed in the global market.”