Japan's Game Industry on Impressive Rise as Western AAA Development Struggles

Comparing Asain developer's average salary to say a developer in California is a crazy amount! But it's not all a bed of roses, just look at the anime sector (mostly talking about MAPPA) and look at how they treat/pay their staff..... food for thought.

Western devs are TOO western, they need to get out of the west coast (cali) , look what cali did to playstation.

@nomither6 Pretty sure that California isn't the problem. This is a phenomenon across the western world. That means US, Canada and Europe.
I am also sure the execs salary is more of a problem than the devs.

"the PS5 is outpacing the PS4" - but only in Trumpland (might as well call it that now) We 'freeloaders' have other ideas.

Perhaps Sony should set up a Studio in Japan - no idea what they could call it...

So this is essentially a reversal of what happened during the 7th generation of consoles, when the Japanese industry struggled to scale up their projects and technology. I'm glad to see Japanese developers doing so well, though. Triple-A had it coming, if you ask me.

Currently on a kick of Japanese developed games and the difference between US based games and Japan based ones is stark.

Suits all over the US games. Ideas abound in the Japanese ones.

I don't know that I would really consider Sony an Eastern developer at this point. If we're talking their software output, at least, most of it is heavily westernized. And...ya know, developed in the West. So their inclusion kinda seems like a contradiction to the proposition the article is presenting.

I mean, also stocks aren't the greatest metric of legitimate success, especially in specific industries. Just, for instance, how much do you think Microsoft's stock moves based on their Xbox business alone? Also while Micro's currently on the decline, it's seen A LOT more growth in the last 5 years than the likes of Nintendo — probably all referenced Eastern publishers, really.

EDIT: Also felt the need to point out the majority of top-sellers from 2024 were Western titles.

A certain Eric Cartman phrase comes to mind when thinking about western gaming devs. When you somehow manage to alienate a large chunk of your audience before a game even releases you are doing things wrong. No one wants culture wars in video games! That’s what we do to escape the culture wars. Eventually things will get better though.

@Boxmonkey A lot of people want culture wars in video games. Especially grifters.

@sanderson72 Perhaps Sony should set up a Studio in Japan - no idea what they could call it...

How about Nintendo’s little brother. Cause Nintendo CRUSHES Sony in Japan. Remember sales matter, not the fun you have with a product only if it sales a lot and Nintendo Dog Walks Sony in Japan, so much so Sony closed it all up and headed West.

I get some are saying western games have some struggles. Sure i can buy that. But GTA 6 and COD along with Fortnite run the industry. So much so most company’s don’t even want to launch their games near it. USA video games are still the most played world wide games. Some teams need to get better for sure. But it’s not as if western games aren’t still the most played maybe outside of Nintendo. Cause Nintendo crushes everyone in sales outside of many RockStar and Minecraft, COD.

Let the AAA western industry burn, and hope that from it ashes rise stronger western AAA industry comparable to ps2, xbox 360, ps3 and early ps4 era.

Man I have fun playing halo, gears of war, god of war, and other great games that the western AAA developers make back then

Eastern devs making games people want to play and have fun doing so. Like 90% of the games i play are from them and the upcoming slate of western games including all of Sony’s 1st party are so unappealing

@HonestHick They would call it Team Asobi

Reminder that SIE (ie the bit of Sony we talk about) is an American company that just happens to have satellite department in Japan

@Lowdefal likely, and i did love Astro Bot. Such a fun game. Would love to see more of it in future.

It ebbs and flows. A decade ago, it was the reverse. You people always try to jock Japan and put down everyone else. This is why most of the Sahdows outrage came from westerners on behalf of the Japanese, while most of the Japanese media seems to be impressed with the game. Hell, even something like this is being turned into a culture war. What was the reason a decade ago when Japan struggled and the west was won?

Also, to those who say the west alienates most of their audience before the game even releases. That’s on gamers, not game makers. You all put too much of your identity into video games. Funnily enough, those same people laugh at others for connecting stuff so closely to their own identity.

@Boxmonkey I also want to note that a lot of the subject matter a Westerner would consider culture war adjacent is pretty casually represented in Japan. Gender representation, for instance, is a lot more openly fluid and androgenous in Japan. To the point where a Mario game had a trans ghost (though you could argue that wasn't very good representation).

I guess they aren't so progressive in matters of race, mostly tokenizing black characters throughout their fiction. But I also don't think they start a fervor if a black character is included in something, either.

It's kinda like it's a different culture with different values and problems, and, naturally, really isn't a part of the Western world's culture war to begin with.

@HonestHick ”USA video games are still the most played world wide games”

Exactly!

And it’s rare that Japan does to a game what gamers tried to do to Shadows. Seems they just skip a game they’re not interested in more so than make it their life’s work to destroy it.

@RoomWithaMoose GREAT POST!!! A lot of western gamers need to internally reflect.

That’s what happens when you make games for gamers

@KillerBoy Agreed and here in the west, the products, "the machines" are designed & developed to make more money after the initial purchase and that's all that matters to those in suits.

Dev says “if you don’t like it, don’t buy it!”
Player says okay!
Studio closes 12 months later.
Having a combative relationship with your target audience is suicidal.
Unfortunately Naughty dog will get the exact same treatment with their next game

@EYEBALL STARES AT MIHOYO

STARES AT MH WILD'S CHARACTER CUSTOMIZATION

STARES AT PLAYSTATION'S LIVE-SERVICE INITIATIVE

STARES AT ADD-ON LIST FOR 75% OF EASTERN GAMES

Nothing will change because the virus is deeply embedded into the industry. The virus started when investors and publisher's became a thing in the industry in the 80s.

Yes games are expensive to make now but it is what it is and there is only so many games now that are not looked down on by money hungry vultures with political minds so on that note I only trust a company or a developer now with good ethics & that's primarily small indie studios.

Most likely a bad case of confirmation bias, but this headline is music to my ears.

To some of the counterarguments, western devs ≠ western Devs. Especially US based Devs earn more because of exorbitant costs of living as well as lack of social systems and job security thanks to union busting. Some laminated cu** face may call it government efficiency... it's clearly bs.
Back to gaming, Japan had a freeze on inflation for a long time now which has just recently been lifted, so you can't compare the wages between top Cali based studio and Japan. They also have federal worker protection laws where you would rather see a CEO taking a reduced salary before mass lay offs. It's not perfect, but by far better than what the US has in place.

It boggled my mind that some were actually legitimately saying last year was a "slow year". It was far from it. We got so many Japanese and Asian games in general that were amazing. This 2nd video game crash seems to only be coming from western side of gaming. And probably deservedly so.

The biggest gripe I have is the insanely high review scores western games get in some publications. Same publications give games like black myth a 6. Then we wonder why no one trusts gaming media anymore.

I've been mainly playing Japanese games every gen since the PS1 and I can say the quality of games from Japanese developers keeps on improving with each gen. Whilst Western developers are stuck in their ways chasing the best visuals and live service, Asian games are more about the fun factor and crazy story lines.

@RoomWithaMoose

At the same time, Nintendo and other Japanese companies like Sega also put in LGBT characters where they are literal caricatures there to be laughed at. Take Vilia, the crossdresser character in Zelda Breath of the Wild: Link is required to talk to Vilia to acquire the outfit to disguise himself as a woman to enter Gerudo town, the whole interaction with this character plays out as a joke at their expense with Link also being able to say in dialogue "You're a man!" and the cutscene also playing it for laughs by having the wind blow Villia's face mask off after he makes a comment about being a woman, with him quickly hiding his face and Link shaking his head upon seeing this in third hand embarrassment.

If we consider the character as actually transgender, then that means Link is even able to purposely mock their identity by saying they're still a man just for player laughs.

Bolson meanwhile is portrayed as potentially gay for laughs, being a literal stereotypical flamboyant gay caricature that would be considered offensive or old fashioned if portrayed in any Western media.

SEGA has also featured such characters in the Yakuza series. Some portrayed relatively normally and without mockery like in that one sub story in Yakuza 3 but the rest are there for the butt of jokes. Yakuza 1 & 0 especially featured a few who Kiryu will happily fight against despite them identifying as transgender women. Most of these characters are played for laughs or even portrayed as sexual assaulters like the one in the The Truth about Beauty sub story in the first game.

Western developers wouldn't do any of these things. Japanese developers do because as you said, relatively few people in Japan really care enough to make it an issue.

Japanese and Chinese developers are filling the void that Western developers refuse to.

Best thing that can happen to Ubisoft is a tencent takeover. Get rid of the French brothers and start again. I think that’s why so many people wanted assassin’s creed to flop.

I'm going to choose to ignore this good news so I can wallow in sorrow and self-loathing

@Boxmonkey If you think that's why so many people wanted the new Assassin's Creed to flop then you missed a whole hell of a lot about the new Assassin's Creed.

@MaelysLeFleau the main reason for the hatred was 100% seeing the opportunity to kill ubi off as we know it. Everything else was just noise

Development costs = staff wages * man hours to make the game.

People look a lot at the second bit of that (time to make game) but not so much at the first part.

Warhorse Studios pays their senior artists $20,000 a year - and that's fine because $20,000 is a nice salary in the Czech Republic. If people's salaries are 7 times lower, the game costs 7 times less to make.

Japan's salaries have been pretty statistic for a long time, which has helped keep Japanese development costs lower.

I suspect similarly, you'd find development costs in the UK haven't risen nearly as much as the US.

Even CD Projekt were helped with their start by much lower salaries in Poland back in the day

In the end, it might be uncomfortable for studios in the richer nations, but globally we're going to see more and more companies in less rich regions make great games. Tech skills are universal now, you can make a great game anywhere.

@TruestoryYep Thank you for giving more of the nitty gritty about Japan's gender representation.

I tried to allude to their failings on the matter, but was focusing more on how what a Westerner might find offensive wouldn't bother a typical Nihonjin.

They have their own values and problems; I just think it's silly to try to prop them up as bastions of Western conservative values apropos this Western culture war that they're mostly oblivious and indifferent to.

Everything that goes up must come down. The Western gaming industry hit an massive high during the late 360/PS3 gen into the early PS4/Xbox generation... Now they are suffering. It no different than the Japan industry hitting a massive high during the PS2/Gamecube/Xbox generation than suffering during the PS3/Xbox 360 gen.

Now we're seeing a raise in development from Asia and Korea. Don't be surprise if in the next 10+ year we're talking about Western industry healing, the Japanese struggling, and the new kings are the Asian and Korean studios.

Of Sony’s 16 (what I’ll call) primary studios, 2 are in the “East” (Polyphony and Asobi), with 14 based in the “West.” The thesis put forward by the headline is fundamentally flawed, or am I missing something?

@jolteon23 SEGA and Square Enix haven't been able to top their previous share price records recently — but yeah, all the reports I've read have suggested that SEGA is doing very well for itself lately.

Strange, with Stellar Blade, I thought Korean games industry was on the rise.

I don't think Western devs can copy what Japanese devs do, not when the minimum salary in Japan is a lot different than Western countries.

Not to mention they have different principal when comes to how they work or design a game. I've read some interviews from a couple of western devs who worked under Japan devs and they said Japan has very high discipline and pretty rigid org structure. The crunch culture also very rampant because Japanese "loves" their overtime.

Who knew there would be a limit to how many times you can sell same s*it with a fresh coat of paint.
Color me surprised!

I'm absolutely certain that someone will correct me if I'm wrong but, don't Sony only have 2 Japanese studios now? They're hardly fighting the good fight for Japanese gaming and I barely consider them a Japanese company anymore.

Nintendo have absolutely destroyed Sony with the Switch in Japan and I don't see any reason why this won't continue with Switch 2. We've gone weeks at times between any PlayStation games being in the Japanese top 10 and I believe (waiting for corrections) that Switch hardware has outsold the PS4 and PS5 hardware combined.

Capcom, Konami and Bandai Namco have either stuck with or returned to what makes them great. It's no wonder they've been successful given they use their IP well and don't spend hundreds of millions per game to do it.

@AhmadSumadi in fairness i did read that Japanese government was planning to meet and discuss banning the sale of Assassin’s Creed Shadow’s in Japan. I since haven’t heard anything more on it but it was at least in discussion state.

@HonestHick I know that. But governments do dumb 💩 like that all the time. Doesn’t mean the people want it. And you know how government officials love to posture for their constituents.

@AverageGamer exactly what I said before! It ebbs and flows. But of course some will take this as western devs failing. That’s not it at all!

Pretty much all of the creativity in American game development, in particular, has retreated into independent development.

@HonestHick You've pretty much highlighted the issue, right? American gaming is dominated by a small handful of live service titans, and you have an entire industry releasing expensive flop after expensive flop chasing that same success. That's pretty much the opposite of a healthy game dev scene.

I'd also argue that the exploitative practice of dissolving and laying off teams after big projects are finished is antithetical to creating a healthy foundation for future success. Short-sighted corporate greed and trend-chasing has, over time, rotted our development efforts from the inside out. It's no wonder the Eastern world is rising.

Well, the West has well and truly arrived at our own version of Idiocracy. Hyper capitalist impatience, sub standard R&D, under qualified hacks in every corner of industry/civics. The ultra rich will get richer bit every other aspect of Western culture is in decline. In my cranky middle aged opinion!

@AhmadSumadi i never really looked into it. I seen it and just skipped by it. It don’t effect me, i live in the USA not Japan. But i thought it was interesting. Not sure Assassin’s Creed sell’s that much over there anyway does it? I mean maybe on Switch or PC. Which is the most popular gaming devices in Japan now.

@Ralizah the issue is those games are where players are at daily and spending money on. It’s hard to have 15 Fortnite’s in the world. Everyone is chasing that money but also just that attention for their game. When GTA 6 comes out it will eat such a large sum of money and players time away from the rest of the industry it is going to be insane. Kind of reminds me of when WOW came out. It was what 7 out of 10 PC gamers at the time were playing the other 3 were on Counter Strike. Look at PS and Xbox’s top 10 played games list every month they are the same games minus 1-2 or some are just in different order. The exclusives and Japanese games aren’t carry the weight like some would like to believe it.

For the record i like all games if they are good, so i am not poo pooing on Japanese games. 😀

@HonestHick Not at all. I'm not even disagreeing with you.

My point is that the Japanese gaming industry is far healthier overall. You have a lot of companies posting record profits and/or doing well for themselves. I'm sure GTA 6 and Fortnite make those earnings look a bit thin in comparison, but as with the economy at large, it's really not healthy or viable long term to have a few players at the top hog all the wealth and success.

So, yes, the biggest earners are probably American, but the American gaming industry at large is not looking good.

Although I'd be curious to know how Chinese gacha giant Mihoyo's earnings compare to the American titans. They've become extremely prominent in recent years between Genshin Impact, Honkai Star Rail, and Zenless Zone Zero.

Western companies have always had a problem with chasing trends. The difference is that now doing so and not selling millions of copies is cancer. Adapt or die out, Japan is fine because they go with what people want.

@HonestHick Shadows is doing pretty well over there critically, but sales is another matter. I feel it’ll flop and not because of being bad or not selling much, but because the targets Ubisoft has set are likely far too high to be reasonably attainable.

@Torque it is, same with china. The big difference is they’re largely just getting a foothold (and digging it in too) so they’ve yet to really cause a big effect overseas. That being said, it’ll happen sooner rather than later given how determined western studios are to complain about gamers when their games don’t make bank instead of looking at why that is.

Game studios aren’t just competing against eachother, they’re competing for our money. Games are too expensive to buy every single new release like we may have at one time, I need to see why I should pick your game over the others releasing at the same time. Western studios tend to be nervous about sharing more of their gameplay, heck they flat out delay games to avoid competition. That doesn’t make me say “I’ll pick you.” It makes me say “there’s a reason you’re not bothering, pass.”

I also think that Western development costs these days almost require games to be on as many platforms as physically possible to avoid the risk of tanking entire teams and studios.

Further down the line I can see more PlayStation games going to rival platforms other than just Lego Horizons. I think Astro Bot on Switch 2 would be a great fit and a huge revenue boost for Sony.

@Boxmonkey Tencent has never made anything better.

@Ralizah i agree with you 100%. I think it’s bad for the overall industry that Fortnite and COD maybe a sport title is all people are really buying. It’s hard for us a gamers to ask for big titles when there are only so many of us that will buy it and end up losing the studio money. I agree with you so much. It’s not a good thing. I don’ even play Fortnite but if i did i would take a break to play other great titles. I know a lot of people make fun of Gamepass or PSN plus. But the truth is it may be of great benefit to us for those services to grow large so they can cut big enough checks to studios to make games we would like to play. Otherwise we might have to see smaller games which i don’t think it a bad thing. I don’t play assassins Creed but i am happy to see it selling and it’s no secret to anyone on here i play my Xbox 4X more than my PS due to liking the off set controller better than Sony’s offering but i don’t like to see Concord or other games fail to the levels that hurt that brand or company to the likes of which we have seen this generation. We have a lot to iron out before the next gen starts and i truly want to see all creative teams be supported and get to play their games. Time will tell of course but again just wait until GTA 6 comes out, my goodness what a shadow that title will cast over anyone not named Rockstar. Outside of COD, Fortnite, Minecraft and Mario kart 9 of course haha

Ice cold take. The Japanese devs were always better.

@Coffeeglitch yeah you make a great point as we have seen many times before a game sells well on paper but doesn’t bring back enough money to make it worth its investment. Sony struggled with that a lot. It’s why you seen so many bundles. Spider-man 2 and GOW and Horizon. They had to add that into the console and charge an extra $50 to make those studios back some money.

Western devs lost their way, that's how I'd summarize their issues lately. Like they always seem to be far too wrapped up in the wrong things and don't even seem to care about delivering the best gaming experience anymore. Meanwhile eastern devs are simply delivering good games that appeal to what the people want.

Outlook on the horizon is a bit bland for me this year so far if I'm honest very much like the last one, metal gear solid delta maybe borderlands 4? And now I'm not sure about AC Shadows? Maybe some unannounced titles might get revealed?

@Ultimapunch nah mate

@TruestoryYep Based Japan, that's why they're at the top of their game right now while the pandering Western companies are constantly flopping

PlayStation is full on American these days.

Funny Japan reeaaally struggled during the PS3 era. Like had a full on identity crisis and even tentpole mainstays like Final Fantasy were faltering with middling releases - even Capcom had their dark days back then, with a high ratio of misses. While the west was crushing it and setting the pace, constantly.

Now, it's looking like a 180 reversal. It's the east's time to shine again. You love to see it.

@Jimmer-jammer

I think the article is more referring to third party publishers like Capcom, Sega, and Namco than Playstation Studios, in terms of software. A lot of people here would argue Playstation haven't exactly been killing it lately - maybe precisely because of how westernized they have become. They've hardly released much that isn't a port in the last two years. Their standout title, Astro Bot, is from one of their few remaining Japanese studios.

Their decision to chase live service and resulting software drought - which many, many people here predicted would happen - is in my view a very Americanized business culture of chasing trends instead of setting them. A very Jim Ryan-esque ethos was at play there.

And yes, I am firmly in the 'Playstation has lost its way' camp. But they will keep making bank.

A shame SEGA isn't in that list, they released great games last year.

While Sony is a Japanese company, their games are mostly Western and their gaming division is in California, so I struggle a bit to consider them part that list, but I guess Astro Bot is Sony's biggest success in the PS5 era.

@UnlimitedSevens That makes sense! I find the way it’s been presented to be a little muddled. There’s a really interesting story buried in these facts…