Japan is one of the biggest gaming markets in the world, the third biggest to be precise. Yet Xbox doesn’t have a dominant hold over the region. Nevertheless, they are now looking to use Mena Kato, a veteran in the Video Game industry to bridge the gap and increase Xbox’s influence in that saturated market. Mena Kato joined Microsoft Corp back in July after leaving PlayStation as a Former Executive. She wants Japanese studios to invest more of their time and resources into Xbox Games and not just PlayStation. However, is it going to be as simple as it sounds?
Contents
- Mena Kato Wants to Make Xbox Great in Japan
- A Comparison of Unit Sales
- Why Japanese Studios Aren’t Investing in Xbox Games
- How Microsoft Can Help Japanese Publishers
- Kato’s Duty into Xbox’s Potential Success in Japan
Mena Kato Wants to Make Xbox Great in Japan
Mena Kato grew up playing Donkey Kong, a Nintendo classic which is ironic since she will have to compete against Nintendo classics with the road she has chosen. After resigning as a Former Executive of PlayStation, she has now set her sights on making Xbox a big name in the Japanese gaming market. A market which is dominated by PlayStation and Nintendo consoles.
However, she is not just rushing into this project. According to Bloomberg, to accomplish the impossible she is “counting on her dealmaking skill, Microsoft’s global reach, and her local connections.” However, the past and the current state of the market are her biggest enemies. The relationship between Xbox and the Japanese Gaming Market has always been rocky and the sales numbers say it all. Let us check for ourselves.
A Comparison of Unit Sales
— @Zuby_Tech (@Zuby_Tech) December 12, 2023
Hardware sales tell a lot about the popularity of a console in a specific region. In the case of Xbox in the Japanese market, their numbers stick out like a sore thumb. In comparison to Nintendo Switch Sales and PlayStation 5 sales, Xbox hasn’t even made a dent. Nintendo Switch sold 31 million units and PlayStation sold 4.8 million units in Japan. Xbox, however, has barely scratched the surface with 500k sales in 2023 (Information according to Famitsu)
That is a bigger gap than most expected, but it is not because of Xbox’s Gaming Catalog. Xbox has enough games that can easily keep any gamer occupied. The reason why there aren’t many sales is because of the dominance of Nintendo and PlayStation. Since both are of Japanese origins and have dominated the market for decades, it can be difficult for gamers there to turn over a new leaf. Especially if it means abandoning the nostalgia-centric games countless gamers like Mena Kato grew up playing.
However, it is not just the dominance, as past animosity might also stand in the way of Xbox’s success.
Why Japanese Studios Aren’t Investing in Xbox Games
Some years ago, Xbox lost the trust of Japanese gamers and developers alike. They thought Japan wasn’t an “important market to consider” for the Xbox One. From that point on, Phil Spencer himself has declared that it was a bad approach and has tried to make amends. He has been visiting the country more, promising Japanese titles as Xbox Exclusives in the coming year and even appearing in Square Enix’s Holdings Co. to shake hands with Takashi Kiryu.
Aside from the past, the present also has a certain influence in lesser sales as PlayStation and Nintendo games have only gotten better in the past years. However, that does not mean all hope is lost for Xbox in Japan. According to USB Securities Analyst Kenji Fukuyama, PlayStation and Nintendo cannot compete with Xbox since “Microsoft offers huge scalability to Japanese publishers as there’s virtually no country without Windows PCs.”
How Microsoft Can Help Japanese Publishers
Before we see how Kato can help with Xbox’s success in Japanese markets, let us see how Microsoft itself can solve one major problem that Japanese studios have. Since most Japanese exclusives are only released for PlayStation or Nintendo, partnering up with Microsoft can help increase profits by tons of margins. Moreover, partnering up with Microsoft indirectly guarantees a port over to Xbox.
However, if these Japanese studios are looking to improve profits, releasing games through personal computers can give them a huge boost and Microsoft can help them achieve that since they hold the majority of the market in the world for PC software. That is exactly what Capcom Co. did this year when they released all of their classic titles on PC at minimal cost.
Kato’s Duty into Xbox’s Potential Success in Japan
Kato is dedicating herself fully to making Xbox a major player in the Japanese market, which is currently filled to the brim with PlayStation and Nintendo consoles. Since she has helped PlayStation dominate the market throughout her tenure, we are sure Xbox can use her expertise. Talking to Bloomberg about how Japanese Publishers can use Microsoft’s network, she said, “Japanese publishers will need us in expanding their business, It would be difficult to do that just with PlayStation.”
Xbox approached Kato a lot of times before she agreed to the deal. Her objective will be to connect with creators and take part in new projects. She will also be partnering up with Sarah Bond, the current Xbox President. Moreover, Kato is continuously having conversations with local game studios in Japan and then reporting the progress to Microsoft HQs in Washington and Redmond.
She knows that the negotiations between her and the rest of the local studios won’t be easy due to the everlasting trust that Japanese consumers and developers have in PlayStation and Nintendo. She also mentioned that Xbox will need to adapt its methods quite a bit if they were to survive in the Japanese gaming market.
