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Consoles here to stay despite smartphone gaming

17 September 2013, 18:36

Tokyo - Games on tablets and smartphones are better, faster and more varied than ever, but the excitement surrounding the upcoming PlayStation 4 - expected to attract big crowds at this week's Tokyo Game Show - proves consoles are here to stay, say observers.

They point to Tuesday's global roll-out of Grand Theft Auto V, the latest in a multi-billion dollar mega-franchise that dwarfs some Hollywood films, as evidence of the sector's vitality.

Although the market has come off its peak, a hard core of gamers will continue to demand their favourite titles on high-performance machines, they said.

Combined retail sales of game consoles - static or portable - and the software for them topped ¥700bn ($7bn) in Japan in 2007, the year after the release of Nintendo's Wii and Sony's PlayStation 3.

But in 2012, the domestic market had shrunk to an estimated ¥485bn, according to Computer Entertainment Supplier's Association.

Specific entertainment

The shortfall is a sharp contrast to the fast-expanding market for social games - those that involve some form of remote communication with others and are usually played in Japan on smartphones and other mobile devices - which now accounts for more than ¥400bn a year.

Hisakazu Hirabayashi, a long-time games industry analyst who heads Tokyo-based consultancy firm InteractKK, said the casual observer might conclude consoles were on their way out.

"It is a market that is not growing but it is stable," Hirabayashi said, adding software sales bottomed out in 2009 at ¥300bn a year and have stayed around there since.

He says consoles can be thought of as a specific entertainment in their own right for a certain sector of society that will never be "won-over" to a different format at the expense of the thing they love.

"They've got their own styles and solid fan-bases... It's a certain 'cultural mode'" that attracts people, he said.

Hirabayashi said games machines have taken root in people's lives and established traditions that can be seen alongside worlds such as sumo and kabuki.

Millions of people are willing to buy a new instalment in a mega-hit series such as Final Fantasy and Dragon Quest "in the same way that kabuki fans will go to the theatre to see their favourite performers in a new version of an old play".


Games evolved on a series of technological innovations but "game content has become a traditional, conservative industry", he said.

Sony is addressing its core audience with the upcoming PlayStation 4, he said. There will be "no leap [in sales] but no flop either," he said.

Big titles still generate excitement.

Analyst Hirabayashi said smartphone games were easy to play and matched people's need to kill time when commuting by train or waiting for food in restaurants.

The bulk of them are free to download, but charge players for extra functions or to unlock new sections.

The pricing model has proved attractive to developers because it gets users hooked on a game and then demands their cash. Users also like it because they enjoy the freedom of being able to play a game and decide whether they like it before parting with money.

"If home console games are like kabuki, smartphone games are like casinos where a small number of high rollers support the business. They are two different markets," Hirabayashi said.

"No one thinks kabuki is dying off because casinos are becoming popular."



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