Is The Sun Still Rising On Japanese Gaming?

Mark Stephens

Japanese gaming has been at the forefront of the industry, pretty much ever since joysticks were invented. We all remember Taito’s Space Invaders which was cutting edge in the early 80s and household names like Sony, Sega, and Nintendo all made their names during the ‘golden age’ of video gaming from the mid-1980s and throughout the ‘90s. But how are the Japanese doing nowadays with video, social and mobile gaming? In the highly competitive, rapidly changing world of game development, do the Japanese have their noses in front?


No longer the undisputed king of gaming

A quick look at the top social game developers on the planet will show a geographically diverse group of companies. The Top 10 social gaming ‘monsters’ that we featured a few weeks back only included one Japanese company– DeNA, which was founded in Tokyo in 1999.

This trend of stiff competition is mirrored in the gaming market as a whole, where the relative success of Japanese companies has declined. In 2002, the Japanese video game industry made up about 50% of the global market; by 2013 that had shrunk to around 13%, under strong competition from the likes of Microsoft and other American/European video game companies.

These companies had learnt well from essentially two decades of Japanese dominance and by the turn of the millennium started making games just as good or better. Japan’s economic stagnation over the past 15 years hasn’t helped either, particularly with declining console sales and similar declines in arcade industry sales.

This is all quite a ‘come down’ from the heady days of the golden age, with one blogger at Tofugu, the popular Japanese language and culture blog, recalling it like this:

‘Throughout the 1990s, if an award-winning, mind-blowing, landmark game came out, you could bet it was Japanese. Japan’s gilded, diamond-encrusted horn of video game plenty was pouring choice oils of gaming goodness upon us all. And it seemed the flow would never dry up.’

Of course the gaming landscape has changed immensely since those days too. Nowadays western console gamers play Halo, Mass Effect and Call of Battlefield: Ghost Ops II rather than the Dungeon Monster or Mega Man type fantasy games that Japanese developers typically specialise in. In the past five years too, the rise of social and mobile gaming has revolutionised the perception, awareness and the reach of gaming.

So how has Japan taken up the social gaming reins?

Social Gaming in Japan

As you would expect, social game is massive in Japan, just as it is practically everywhere else in the world.

Mobile games tend to go viral very quickly and generate a lot of buzz, with multi-millions of players racked up at record speed. These games are usually free-to-play, with the option of in-game purchases helping to generate huge revenue for the developers of the top games.

One of the latest games to make a big splash is Monster Strike or ‘Mon-Suto’, which is a simple bowling game, where the pins are monsters. It was released last October by mixi, a large Japanese social-networking service, and has already gathered over 10 million users.

This is typical of social gaming in Japan, where social networking platforms frequently release games themselves; Gree and DeNA’s Mobage are both similar examples.


Interestingly, Mixi was rather late on the scene in terms of offering games, and paid the price for this with declining market share. The release of ‘Mon-Suto’ has almost instantly turned its fortunes around, with its stock rising twenty-fivefold and its market value surpassing that of DeNA and Gree. Other developers too have seen this type of rapid turnaround of fortunes: two examples are Klab, on the back of the success of its game Love Live! and GungHo, who’s game Puzzle & Dragons has been one of the biggest Japanese social games of the past two years.

Another social gaming success story is Line, the hugely popular mobile messaging platform that is the number one free app in 60 countries and offers a suite of games to its 490 million global users; the company recently announced a partnership with gumi to expand its global reach. Line is perhaps leading the Japanese charge back into its old territory in the west, by partnering with gumi – the developer responsible for the social game Brave Frontier, which makes $80,000 in sales daily in the United States.

Japanese games are still widely played in the Asian gaming market, and are often published in Chinese, Korean and other Asian languages, but the days of Americans and Europeans flocking to play the latest Japanese game seem to be over at least for now. It’s a long and difficult road back to the type of dominance that the Japanese gaming industry enjoyed two decades ago.

As the Tofugu blogger says:

‘The truth is, Japan will likely never again rule the video game world as it once did. Global competition and the advent of mobile/social gaming has changed the industry so nobody knows what to expect anymore. (BIRDS being angry at PIGS?! Nobody saw that one coming.)’