The Japanese gaming market has changed dramatically over the past few years. PCs have become more important to local gamers, Chinese studios have increased their presence in the mobile space, and Nintendo continues to capture a large share of the console market. Conversation with analyst Serkan Toto gaming business He talked about several trends that he believed best reflected the changes taking place.
One of the most dramatic changes was the rise of the personal computer. In 2019, the platform accounted for approximately 5% of the Japanese gaming market, and by 2025 this number will reach 12.5%. Toto attributed the growth to a variety of factors, including the pandemic, PlayStation 5 shortages, the success of PUBG and changing attitudes among Japanese publishers toward PC audiences. If previously big companies like Capcom and Sega viewed computers primarily as a platform for foreign players, that has changed now.
The rise of the PC comes with another noteworthy trend: Chinese mobile games are increasingly competing with Japanese games. Toto said Chinese studios already dominate Japanese charts, not only in terms of downloads but also revenue. The analyst also believes that Tencent and NetEase’s attempts to directly gain a foothold in the Japanese industry did not bring the expected results. Both companies invested heavily in local developers but subsequently reduced their share of the market. Toto attributes this to a lack of understanding of Japan’s development process. In his assessment, investments by Chinese companies did not lead to the successful games they expected.
Thanks to Nintendo, things are looking different in the console market. Toto estimates the company’s share of Japan’s gaming content market at around 70%, and believes the success of the Nintendo Switch has played an important role in maintaining the country’s largest console market. In his view, without a successful game console, a large portion of Japanese gamers may eventually turn to smartphones and PCs.
