Convergence and Globalization in the Japanese Videogame Industry

For contemporary media scholars, convergence means more than technologies or content coming together in one box.¹ It instead alludes to the convergence of content across media platforms, and the joining together of media producers and consumers in the production and negotiation of that content—through user-generated content, greater feedback mechanisms for consumers, or fan-driven media campaigns. Yet apart from a sidebar mentioning the importance that both Western and Japanese fans have played in the global popularity of Japanese anime, most examples that Henry Jenkins cites in Convergence Culture, and the majority of work done by other media scholars, focuses on Western media products and companies.²

This essay addresses that omission and advocates further investigation regarding the Japanese game industry by studying three companies successful in developing and publishing games, along with a range of other activities. Those companies are Bandai Namco, Square Enix, and Konami. I chose these three for several reasons. First, all released annual reports for 2007, which formed the starting point of analysis. Second, the companies have had long histories and have all weathered multiple console releases, as well as evolving cultural, technological, social, and political developments. None of the three are principally console manufacturers, like Sony and Nintendo. Those companies would make comparisons more difficult, as hardware and software production are different undertakings. And finally, I chose companies that acted as both developers and publishers and who had diversified holdings. Not all Japanese videogame companies are this diverse in their ownership and business strategies; it is exactly their diversity that makes these three companies particularly interesting and important.³

This essay investigates how these companies are negotiating the “convergence culture” that Jenkins writes about. Next, it examines how they are responding to a problem unique to Japan—the graying of the nation. Lastly, it questions how globalization plays a role in Japanese game business strategies.

First, however, let me give a brief description of each company. The oldest is Bandai Namco. Bandai began in the 1950s producing various toys, mostly metallic cars. It created the Sailor Moon and Power Rangers brands, released Tamagotchi in 1996, and in 2005 acquired Namco.⁴ Namco started out producing mechanical rocking horses, later acquiring the Japanese division of Atari and entering the coin-operated game market. In 1980 Namco released the global blockbuster Pac-Man, and in 1993 the company merged with Aladdin’s Castle Inc., to become the world’s largest arcade company.⁵ Bandai Namco now comprises business units that include game development, arcades, toys and toy-related products, spa facilities, tourist hotels, online services, anime production, and restaurants.

Konami incorporated in 1973, when it began to manufacture amusement machines.⁶ It created the hit arcade game Frogger in 1981, and has since produced some of the best-known games in game history, including the Castlevania (1986–2008), Contra (1987–2007), Silent Hill (1999–2008), and Metal Gear (1987–2008) series, along with Dance Dance Revolution (1998) and the soccer series Winning Eleven (1995–2008). Currently, Konami has three business segments. Its Digital Entertainment segment comprises home videogame software, card games, and amusement arcade machines. The Health and Fitness segment operates sports clubs and develops health-related products and services. Lastly, the Gaming and System segment develops, manufactures, and supplies gaming machines and casino management systems.

The final company, Square Enix, is the product of another merger, in 2003, of two Japanese developer/publisher stalwarts best known for their Final Fantasy (1987–2008) and Dragon Quest (1986–2008) series. Enix was founded in 1975, while Square began operations in 1986. Square Enix continues to release games in the Final Fantasy and Dragon Quest series, along with developing games for emerging markets in China and Korea. In 2005, Square Enix acquired Taito Corporation, which started operating in 1953 as a manufacturer of small vending machines. Taito went on to expand its arcade business, developing the global hit Space Invaders in 1978. Square Enix segments its business into numerous areas, including offline games, online games, mobile phone content, publications, and amusements.

Convergence Culture Meets Japan’s Media Mix

Jenkins writes how content...