X-Planations #1: Japan = Failure?
Written By: Nick Arvites

On many of the Internet’s various forums (including VGF’s forums), one of the reasons people cite for the "coming failure" of the Xbox is the argument: "The Xbox will fail in Japan." Now, I can see how this is relevant if the people arguing were in Japan, but the simple fact that this argument is pulled from the mouths of American and European gamers is quite disturbing. Another typical argument is Microsoft is not doing anything right with the launch of their console. Basically, my purpose of writing this is to help prove these arguments wrong.

Perhaps if the gaming market went back in time 15 years and used the age-old mindset of ignoring the territories outside of Japan, this theory would hold true. However, the last generation of consoles did one important thing to the industry in general. The entrance of the global corporation Sony pulled the gaming industry (kicking and screaming in some cases) into a global market economy. Now, all of the major companies look at the marketing picture in a global sense instead of a territorial sense. Granted, there are still exceptions, but all of the major players have seen how profitable and smart it is to take into account the tastes and sales in the other territories. Squaresoft is the poster-child of global gaming. Before the release of Final Fantasy 7, Square was a niche developer making niche games that almost never made it outside of Japan in their original form because the controlling powers didn’t think the games would move in the US. Jump to the post Final Fantasy 7 world. Squaresoft is considered one of the top developers in the entire industry. Why? Because their games were smash hits worldwide, including Japan. Perhaps Sega would have survived longer if they would have understood the global market. The Sega Saturn was a hit in Japan, but didn’t achieve their expectations in the US. When the Saturn died in the US, it was still going in Japan. However, instead of concentrating in one strong market, Sega pulled the plug altogether. The Dreamcast was the opposite. Japan didn’t really want it, but it sold fairly well in the US (especially considering the PS2 was a year away when it launched). However, instead of concentrating in the US and European markets to try to gain more sales, Sega just gave up. Sega simply cannot keep up with Sony or even Nintendo and I know that’s what dug them in a grave to begin with (so save the hate mail for something else), but the fact remains they started digging by not reading markets correctly.

So many people are now asking, "What’s the point?" First off, Microsoft breaks a pattern of console manufacturers by actually being located in the US. Unlike Japanese based companies like Nintendo and formerly Sega, Microsoft’s main market will easily be their home market. Now, many people have screamed that developers will ignore Microsoft because it’s only strong in one market. Not only is it far too early to tell the Xbox’s success or failure in any territory, but gaming companies would be stupid to ignore a major player in the market as well as get on Microsoft’s bad side. Now, Microsoft’s bad side is not the over-exaggerated things you’ll hear on the ‘net, but it does mean one major thing: No Microsoft money for you! Many companies, like Microsoft, are obviously looking to the future. Many people often forget this is Microsoft’s maiden voyage in the console world and this is as much of a learning experience for them as it was for Sony back with the PSone. Microsoft’s major advantage in this industry is their understanding of the online gaming world. Out of the three companies, Microsoft is the only one that is taking the online gaming world seriously. Because of this, Microsoft is even watched by their competitors who obviously don’t think online gaming will work with console gaming. Microsoft has done everything right so far, yet they’re still criticized. I ask "why?" They launched with a better than average games, they included every bell and whistle with the console and still kept it affordable, and they have a wide range of releases scheduled over the next few years. Microsoft’s even acquired exclusives, several first run titles with extra features, and signed deals with almost every third party company out there. So how are they screwing up?

Not only will Microsoft’s success or failure in Japan not effect them in terms of total success and support, but Microsoft’s actually doing things right the first time around with the console business. When was the last time you saw a company in their first outing do everything right? Microsoft has the support, the games, the hardware, and more importantly the dollar of over one million North American consumers.

Posted: 1-29-02