The third party market in the games industry is a tumultuous one, especially in Japan. Koei in particular, who has begun
merger talks with fellow game publisher Tecmo. Speaking to Gamasutra's Brandon Sheffield and Leigh Alexander separate from the recent news, Koei President Kenji Matsubara talks about the issues third parties in Japan currently face in a changing video games market.
Matsubara talks about Japan being in a "transition situation", with the previous dominance of the PlayStation 2 waning in the face of the newest generation of consoles and handhelds, led to the forefront by Nintendo's Wii and DS systems. He sees that the Wii will emulate the DS's outstanding success, drawing the same parallels, as the DS was primarily Nintendo-dominated within the first few years of its life cycle, and later becoming a sustainable market for third parties. The company is also encouraged by the PSP's relative success, with titles like Capcom's Monster Hunter Portable series selling over two million copies. He is optimistic about the fortunes of the new generation market.
Koei's President also talks about the need to diversify their games lineup by region and console. Koei's Canadian studio is brought up; it was founded in 2001, started game development in 2005, and will finally release their first game later this year: Prey the Stars for the Nintendo DS.
To the surprise of many, Tecmo last week rejected a friendly takeover offer from Square Enix in favor of a merger with Dynasty Warrior publisher -- and rival -- Koei.
Tecmo and Koei are now working on a detailed merger plan together, as Tecmo has said joining up with Koei gives it a better shot at "boosting corporate value," even though the proposed merger would create a company only a third Square Enix's size.
Separately of these new announcements, Gamasutra recently spoke to Koei president Kenji Matsubara, who says that the current market in Japan "is very tough for third parties like us to do our business," which suggests that it may indeed be better in the eyes of smaller developers to join forces, rather than to be consumed by the larger ones.
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Seriously though, as a proud PS2 gamer, I'm glad they want to keep using a viable system. Why make the next-gen leap if you won't survive the landing?