Three years ago a company like Koei - no big-time player, but a profitable enough maker of its core titles - had a captive audience of more than 100 million PS2 owners for its games. Now Koei is scraping, along with everyone else, for a drastically smaller market in which development costs are doubled. The comments of Koei's President Kenji Matsubara that the next-gen market is slow and that it had expected a greater take-up of the PS3 by now was just one of a number of laments from Japanese developers over the past few weeks, with Metal Gear Solid's Hideo Kojima worrying in a job advertisement that the creative side of gaming is in danger of being lost; and his former employee, Ryan Payton, surprising no one by saying that "the Japanese public seems to be disinterested in next-gen and high definition gaming."
The fact that this dilemma exists at all provides an interesting, and damning, view of the games industry in general. The game market looks at Japan and asks pleadingly, "why won't you buy our stuff?" - in other words, they seem to think that the problem lies with Japan rather than with gaming. Instead of asking what is wrong with Japan, the industry should be asking itself what's wrong with its product.
If there was anywhere that is prime to take advantage of what the next-gen consoles offer, it should be Japan. The country pioneered the development of HDTV, and its electronics companies, Sony amongst them, rule the global market of HDTV sets. At the same time, it is one of the most broadband-connected countries in the world. In other words, a large amount of customers have exactly the necessary equipment to get the most out of what the most powerful next-gen consoles are supposed to offer - but they're sticking with the DSs, PS2s in large numbers, or buying Wiis.
Using the Japanese market to gauge the reactions of other markets is notoriously risky - for every boom like Pokemon or camera phones that the West gladly accepts, there are a dozen purikuras that remain a distinctly Japanese phenomenon. However, I wonder if the Japanese market's ennui with games in general and their "rejection" of powerful next-gen machines might not be a premonition of things to come in the West as well. The Japanese developers still, for now, have the West to turn to -no longer being able to market their product in their own country. But for how much longer?
I say this because the fact that it has been the Wii that is the runaway success story of this generation in all territories has confused and frightened the industry because it directly contradicts our traditional "bigger, stronger, faster" logic. Fanboys, and an embarrassing number within the industry itself, seek to sideline it, saying it's not a next-gen console, deriding its graphical abilities, its online capabilities, or its "attach rate." But Microsoft and Sony are in a battle for second place now, and they know it.