Thursday, 25 August 2011

Arrogance and the Industry Four - Failure to Culturally Communicate

There's been a lot of talk this week about the potential abandonment of the Xbox 360 by Japanese retailers. While the unceremonious dropping does not strike me as particularly surprising, it is rather disheartening.

This is not a case of one individual or even one company's arrogance, and since these events are still unfolding it will be hard to make any determination to the potential harm (or, somehow, good) that this event will render - assuming that it even registers. The comment that Jerry Holkins (or as most know him, Tycho Brahe) made just this past Monday does little to assuage my fears over the situation:

"you might hear a person from Microsoft (who should probably know better than to talk to me) wonder aloud whether it’s possible to succeed in this business without Japan.  They are asking it in a way that implies they have already answered this question for themselves and, indeed, answered it in the affirmative."

Can Microsoft survive without making a foothold in the Japanese market? Yes, of course they can. But is it a good idea in the long term? The answer to that is a lot murkier, but should generally be an unsurprising "no".

Microsoft and Japan as a seeming cultural entity have failed to meet each other halfway. The gaming and consumer culture in Japan is partially to blame, no doubt. There is an insular nature to the Japanese that makes the potential for any out of community forces gaining a foothold that much harder, and let's face it: Nintendo and Sony are both Japanese developers that already have the respect and trust of most of the public in their pockets.

The thing is though, Microsoft would have to have been deaf, blind and dumb to not realize that Japan was going to be a hard fight. While people have accused the big M of many things, I cannot believe that they would go into a market without heavy research on how to integrate themselves; they are a business after all, and judging from the amounts of money they've made in the past, not a stupid one either.

You could argue that Microsoft did take steps, gaining the trust and even some deals for exclusives from companies like Tecmo, and even snagging away the formerly Sony exclusive Final Fantasy series which should have proven to be a big draw. Hell, they even got  Hironobu Sakaguchi to develop a game for them and got Akira Toriyama to create the art and character designs.

The resulting game - Blue Dragon - did do quite well in Japan, but it seems that aside from trying to get more RPGs on the system, that Microsoft was rather complacent about the entire thing. There was a seeming lack of a need to get some in house studios over in the country. There were third party developers like Mistwalker, Grasshopper Manufacture, and Q Entertainment, but there was no initiative to place a first party development suite in Japan, where I believe it would have done some good. A base of operations in Japan devoted to the 360 would have allowed Microsoft to become more in tune with what they would need to achieve in order to move their units to a resistant public. Needless to say, what is seemingly happening now is the exact opposite of what needed to.

Now that Japan has seemingly said "we don't want you" and Microsoft has responded with "we don't need you", both parties can only be hurt in the long run. Microsoft was initially laughed at when they entered the gaming market less than a decade ago. No one is laughing now; they've proved their success. But Microsoft needs to get into the Japanese market in order to go from a strong contender to the potential top of the heap. Japan is a huge market that both Sony and Nintendo have relied upon to weather storms and bolster their positions, and while North America is the same for Microsoft, they aren't really going to make their opponents nervous without making in-strides to where the other two of the big three call home.

Money, if anything, shouldn't be an issue. I know that even with the resources of Bill Gates behind you that reckless spending isn't advisable, but isn't spending a modest sum now to get larger returns - you know, investing - something that is encouraged on both the part of the individual and the corporation? By saying that they don't need Japan, Microsoft is cutting itself off from a huge chunk of potential market shares, all because they seemingly looked around and said "well, since it's not as easy as it is everywhere else, it's not worth sticking around". I can't help but wonder not if, but rather when, they might come to regret that decision.

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