IR Top Page > Developer Interview 2009 > vol07.Takeshi Tezuka
- - To start with, could you tell us how you see the current situation of the domestic mobile market.
- "Tezuka"
In Japan the sales of cell phones is declining, because the discontinuation of the incentive system for device manufacturers has forced them to hike prices.
Until recently, the new features and preinstalled contents offered by new models were the main things most users considered when buying a phone. However, slumping sales has had a negative impact on the digital contents market.
Likewise, the emergence of unofficial sites providing free games has triggered a remarkable shift among users in the casual games segment.
- - Have games become a lower priority for cell phones?
- "Tezuka"
I don't think so, because games are always a major priority for cell phone contents. Even now there is still a strong demand for games among users, manufacturers, and carriers. Despite this, the paid contents industry for mobile devices remains sluggish as a whole. Although we want to fulfill our role as a game provider and develop games for new cell phone models, weak cell phone sales have made it difficult to move forward with large-scale projects.
In the past when a new cell phone model was released, carriers used to help us advertise our new contents for the model. Unfortunately this support has largely disappeared, so we can't expect to recoup the development costs of contents for next generation models.
Still, that doesn't hold true for unofficial sites that offer free games. There are a few successful companies using the so-called "freemium" business model. They attract a large number of users by offering them free games, and then charge a section of these users. I think it's safe to say that "playing games on a cell phone" has become the norm. The key thing we must consider is how to spread and distribute our premium contents.
- - What about the overseas markets?
- "Tezuka"
Recently smartphones that offer advanced functionality, such as the iPhone, have come to dominate the overseas market. Smartphones have dramatically raised the degree of freedom in visual expression. Since the release of the iPhone, a number of device manufacturers have announced new platforms for distributing dedicated applications, or have launched portal sites for content distribution. In the future, we'll probably see operational system providers and web service providers actively enter the market for mobile contents distribution. Capcom is planning to establish a global distribution system that will enable us to cover all regions and device models.
- - Did the iPhone revolutionize the way games are developed?
- "Tezuka"
The emergence of the iPhone has led to a remarkable improvement in the functionality of cell phones in the West. In the past, functionality differences by region were the major headache for us -- we had to find a way to support a broad range of device models. The global spread of sophisticated models has practically eliminated this gap. If you ask me, this change has improved the development process and made our work easier.
- - Advanced cell phones are also spreading throughout Asia.
- "Tezuka"
That's right. Looking at Korea, the functionality of cell phones is steadily improving, though the level is not as high as Japan. We've released some 3D games in Korea, such as Mega Man X, Ace Attorney, and Resident Evil. Resident Evil was picked up by a domestic company for use as preinstalled game, because they felt it would help show off the features of their cell phone. We received a lot of praise for this project.
- - Do you receive a large number of requests from cell phone carriers to develop games?
- "Tezuka"
Yes. Our full lineup of contents is one of our greatest assets. We get a lot of orders from corporations at both home and abroad. Because we have created and distributed arcade games, our brand name is strong in emerging areas where home video game consoles are still relatively uncommon.
As people's incomes rise in China, India and Brazil, home video game consoles are on the verge of really taking off in these countries. By taking small risks to quickly make Capcom a well-known brand in the cell phone game industry, I am confident we‘ll be able to secure a dominant position when home video game consoles become fully widespread.
As a matter of fact, EA and GAMELOFT are forsaking short-term profits and currently putting a lot of effort into acquiring shares. That is essentially what the cell phone game business is all about in the long term.
- - Is Japan the largest market in Asia?
- "Tezuka"
Definitely. Japan represents an overwhelmingly large portion of the market. The amount of contents available is also noticeably much greater than any of the other markets. Still, the Korean market is exhibiting a unique form of growth and cannot be overlooked. Korea is well-represented by global cell phone manufacturers such as Samsung and LG. Original payment models derived from online game businesses and the ability to develop contents suited for cell phones also deserve attention. Though Korea counts for only small percentage of our net sales, we're working with a lot of companies there to collect information.
- - What kinds of games are most popular in Korea?
- "Tezuka"
Inexpensive games that are available for a long time are popular. Many games use a "micropayment" (micro billing) system. In this system, users purchase a service at a low price, and then pay additional fees when they obtain new contents. This system is widespread and firmly established in Korea, providing users with a great way to enjoy a single game for a long time. In Japan, certain forms of micropayment, such as "charging for items," are also gradually increasing, but in my opinion, they are not as sophisticated or as common as the systems in Korea. It's difficult to satisfy our users by placing a simple charge for items within a free game. Trying to find a way to charge them that appears as natural as possible, in the end I think it's all psychological.
- - How would you describe the current market situation in Taiwan?
- "Tezuka"
The Taiwanese market is in a transition period, and cell phones are becoming increasingly more sophisticated at a pace faster than expected. However, one problem hurting our management system is that we sometimes have trouble managing local developers. These firms are able to localize relatively simple games, but they often run into problems developing more complex games or those requiring a high level of technical expertise.
- - Do the characteristics of games differ by region?
- "Tezuka"
Absolutely. They are totally different. In Korea, for example, games that are available for a long time are popular, so we try to include these characteristics within the games we distribute. While Resident Evil and Mega Man X are only offered as a downloadable version in Japan, in Korea we incorporated a system for selling additional items, such as virtual weapons and clothes. This is just one example of how we attempt a number of different approaches to adapt to the traits of each region.
Originally, we intended to distribute products just as they were sold in Japan. But this resulted in complete failure. Though I've heard Japanese games are becoming less popular overseas, when it comes to cell phones the domestic or regional traits are far more important when developing games. This is because most users are not really "gamers", but rather the average person. Currently we are trying to incorporate all the great ideas we've obtained by working in close contact with local people.
Still, based on my own experience from developing arcade video games, I'm convinced there is a universal element of excitement in video games that appeals to people all over the world.
