=== Wanting to save Capcom but not being able to: is Inafune not needed? ===



4G: So why do you want to go to all the trouble of saving Capcom?



KI: Because I love Capcom. Of the 25 years I've been in the industry, for 23 years I was just working at Capcom. Not going to another job, not knowing other companies, just wanting to improve Capcom.



4G: It's not like you're running away, but how to say, perhaps it was a matter of you having to put up with a lot of things.



KI: This situation is, to make a poor analogy, like in a long marriage, where splitting up isn't a matter of hating the other person. Capcom is a great company and I really love it. That won't change with me quitting. I'll always be a Capcom fan.



I'm also an Osaka fan, so if I were a pro baseball player, I'd want to play for the Hanshin Tigers. Even though the Yomiuri Giants pay more, I'd want to play for Hanshin. I'd play to win.



4G: I see.



KI: It's the same as wanting to save Capcom. However, my having become dependent upon Capcom is a different problem, but because it became clear that I'm on a different path, I decided to leave Capcom.



4G: So if you want to save Capcom, you can continue working on that even after leaving. It seems like there are a lot of people like that.



KI: That's absolutely right. So I told Capcom that I'm leaving to start my own company, while still contracting with them, continuing with titles already underway and following through with their plans. If that was acceptable, I wouldn't be able to work with any other publishers, but I'd have been able to finish what I'd started. However, that wasn't possible. I was told, "That won't be necessary."



4G: I see... Although I don't know the details of that refusal, it might result in some of the titles already underway not ever seeing the light of day.



KI: That's possible.



4G: I wonder if Rockman Dash 3 will be okay...



KI: Looking at the timing, the team members, and the planning done, Rockman Dash 3 is finally on its way. I really didn't want to quit right now... But I can't do it anymore. My will to continue has run out. That's why I had to leave Capcom and strengthen my resolve, as I wanted to help finish working on it from the outside but was unable to.



4G: As you mentioned before, if Rockman sells because Inafune made it, it won't make it out. But if Rockman sells because it's Rockman, the project will survive.



KI: That's exactly right.



For Capcom, it doesn't matter whether a game has the Inafune brand or is made by some anonymous producer. That's ultimately why I made the decision to leave. It's sad to leave, proving that point. It was really sad.



4G: Was the Inafune brand really treated that way?



KI: I got the impression that the Inafune brand was the worst-handled within Capcom. Say you had a beautiful younger sister, and of course other people would say, "Your younger sister is pretty. It must be nice to live with her." But then maybe you look at her and think she's rather average? It's kind of like that. (laughs)



4G: I'm not exactly sure what you mean, but I think I get the point. (laughs)



As common as the problem of not being as important as you might think is, there's also the problem of not being treated as well as you should. Which would you say was more the case?



KI: Even when I submitted my letter of resignation, nobody contacted me about it. (laughs) There should've been a, "Hey Inafune, do you have some time?" or, "What do you mean by this? I want to hear it straight from you." Nothing. Zero.



4G: ...You've got to be kidding.



KI: Well of course, my actual staff asked me not to quit, but you would think that someone from management would want to at least try and stop someone with such skills from leaving, or even ask about it.



4G: Hmm...



KI: That's fine, though. I expected that. But for a company whose whole business is making and selling games, you've got to think that development would be the key point. If you ignore development, the company can't stand, so that's the way things currently are.



I can't say that I haven't been able to make lots of different things, but I would've liked for the development-side to be more trusted in making games.



4G: It isn't?



KI: No. Not a single member of the board of directors understands games. I didn't ask to be a board member, but if you don't have someone who understands games in the position of making those final decisions, there winds up being a business-side that doesn't understand games and development-side that wants to make games. I feel that's the biggest problem Capcom will be facing.



4G: It may be that way, but ultimately the ones who make the final decisions are the president and the chairman.



KI: That's right, but them getting the wrong information during the decision-making process certainly doesn't help at all.



4G: Well, of course not.



KI: So even if the president and the chairman don't want to hear something, I would have to tell them. That's something that I did, even if sometimes it only earned me their scorn. I can say that I just wanted them to understand my points. I don't mean in terms of money or standing, either. If I had simply been told, "We were angry with you then, but you were right," I don't think things would've have turned out this way.



I was certainly pushing for both the western strategy and the multi-platform strategy, and I still think they wound up being correct. If I'd simply been told, "You were right," I might've been able to remain motivated.



=== A Capcom-style game can be made by assigning 10 people: the myth of internal production is crumbling ===



4G: As this talk has gotten a bit pessimistic, I'd like to ask you more about foreign development. You mentioned it a bit earlier, but judging by your blog posts and the like, it seems like it's a topic that is easier to understand.



KI: Where should I start... At Capcom, there are currently 700 developers who handle 3 or 4 titles.



4G: ...What?



KI: It's exactly as I said.



4G: What is everyone else doing?



KI: There is nobody else. All 700 of them are handling 3 or 4 titles.



4G: Well, hold on a minute. If there are 4 titles, that'd be about 180 people per title. So accounting for error, there are maybe about 150 people on each title? The cost of labor for the duration of a project would have to be something like 2 billion yen ($25 million).



KI: Right, it's not enough. That's why the myth of internal production is crumbling.



Having 700 developers working on 4 titles leaves everyone saying they're always busy. Since 150 people work on each title, a month's cost of labor generally costs between 150 million ($1.9 million) and 200 million yen ($2.5 million).



4G: So 3 months' labor would cost 600 million yen ($7.5 million). Ten months would come to 2 billion yen ($25 million). If a project took 3 years... It'd be at least 6 billion yen ($75 million).



KI: Right. Well, it's not like 150 people are all suddenly put on a project, but it's common for a project to cost 3 or 4 billion yen ($37.5-50 million).



4G: So as one would expect, if that one shot fails, it's really bad.



KI: Yeah. There could be a loss of 1 billion yen ($12.5 million). There's nothing you can do to make up for that. It's internal supremacy.



4G: What was the most recent internally-produced hit?



KI: That'd be Biohazard 5, two years ago. That also took 150 people. This year, it's mostly external. Street Fighter IV was external. Monster Hunter Diary: Poka-Poka Island Village, which sold half a million, was external. Dead Rising is also external.



Lost Planet 2 was made internally, but readers of 4Gamer know how that turned out. At the end of the year, Monster Hunter Portable 3rd will be released, having been developed internally. It'll definitely be a hit. After that, Marvel vs. Capcom 3 is also external.



Basically, there are no internally-developed titles outside of Monster Hunter that can be qualified as hits. There are no internally-developed hits besides Monster Hunter and Biohazard. If you were to ask if those two titles can support the several thousand people at Capcom, the answer would be no. That's why we had to make them.



4G: As you said before -- and it's not limited to Capcom -- there's risk in developing several 2 or 3 billion yen projects.



KI: Right. It can be futile. It can be really futile.



So that's why I -- speaking very broadly -- say that it's not good for a publisher to employ such a number of people in order to maintain this structure. Not speaking in terms of the aforementioned numbers, it would be practical to reduce the staff by half, in turn relying on external developers.



When I made Dead Rising, there were only 5 people from Capcom assigned to it. Adding in a producer and an assistant, that got to be about maybe 7 people? Even then, we didn't have to assign as many as 10 people to it. By just assigning less than 10 internal staff, we could make a title for the global market.



4G: So what you're saying is that you can create a Capcom-style game by assigning 10 people to it.



KI: That's exactly right. For example, I was just working on 6 different titles, and among those, there were only 15 people from Capcom assigned to them. Several of those people are taking part in several projects, so each title has about 5 Capcom staffers involved. This is entirely possible.



4G: So by that reasoning, 50 people can make 10 titles.



KI: They can, even if only in theory. I can't leave one big thing out, though. If this isn't done more, getting back to our earlier discussion, Capcom as a company won't survive.



Internal development is important. I'm not saying that it's not needed. In terms of quality control and the staff's motivation, there should be internal development. Capcom itself as of late consists of Monster Hunter and Biohazard. These two series are very important brands. These two series should only be developed internally.



Taking that into account, if each series takes 150 people each, it'd require 300 people to develop one of each at the same time. Other than that... Right, it'd be external development, so of course there'd need to be some supervision in place. So there would need to be about 100 supervisors. With a hundred supervisors, you could produce 20 titles, all with 400 people.



4G: Right now there are 700 developers.



KI: Yes. Even though I was in the upper level, I'm not one who relishes restructuring. It's necessary for the company's survival. It's a difference of 300 peoples' salaries.



I've said it many times, but unlike Konami, Capcom is a company that only makes games. All it does is make games. That's why it needs to do well by any means necessary. That much should be obvious.



4G: So basically, one way of doing that is to work with western developers, as you've indicated.



KI: Right. What I did in order to succeed was show that Capcom games can be made externally. I disproved the long-held belief that externally-developed games can't be Capcom games. First with Dead Rising, then with Street Fighter IV. More titles need to be developed that way. This will result in good things for both the company and the players.



=== Working with western developers, discussing things thoroughly and communicating well ===



4G: One can recognize the appeal of external developers, but why western? There must be a reason besides cost.



KI: Because of their superiority.



4G: Technically?



KI: Yes. They're also far and away more passionate. That's one big reason. As stated before in regards to IPOs, western developers are far more fragmented than in Japan; the lower tiers of western developers, I hate to say, are slaves. In an environment where it's not unusual to get laid off, you have to do you work well, and make an effort to get noticed, they've made advances.



4G: So unlike in the deep-rooted lifetime employment system in Japan, you are directly responsible for your own success or failure. So the motivation is different.



KI: Exactly. Their level of drive is completely different. On the other hand, Japanese developers from top to bottom have the same feeling. Of course they're not really slaves, but on the other hand, just because you made a hit, it doesn't mean you'll see anything for it.



4G: I've heard that there are incentives worth millions of yen, but that's at the company's discretion and you can't get more above and beyond that. Whether that's good or bad is another matter, but it's one of the trade-offs in a courteous employment system.



KI: Yeah. Incentives run in the hundreds of thousands of yen. Even directors don't get incentives more than 2 million yen or so. Of course it's better than nothing, but in such a system in which you're working to bring in just 100 million yen at once, that difference seems pretty silly.



4G: So it's not just a problem of money, but it's that sense of making advances that's totally different.



KI: Right. People even on the bottom level are working as hard as they can to advance. For western developers, everyone at the director level gets their own office, an object of envy. Everyone says, "I want my own office, too." That kind of hungry attitude leads to going in good directions, so that's why I love western developers.



4G: So what are the cons of using western developers?



KI: First, you can't just leave them alone. Even with technical skills, they often lack adequate ideas and concepts for utilizing those skills. That's exactly why I'm such a good match for them. (laughs) They don't have to be a top-notch development studio. I just want to work with a team that has good potential and a positive work attitude.



4G: To inquire further, what about schedule management and quality control? From what I've heard from everyone so far, those two points are usually the main cause when projects with western developers fail.



So it's like if you order a studio, "It needs to be this kind of game. We're counting on you!" and look at the prototype and it's not quite what you wanted, but it's already pushing the deadline and the budget, and you don't want it to come to nothing so you press on?



KI: You really know what it's like. But that's not just limited to overseas, but also extends to domestic and even publishers' internal developers. (laughs)



There's only one way to avoid that: to always discuss what's fun in the game. You might think one part is fun, but the other side might think some other part is fun. This happens frequently, so the final product could wind up being a disaster. You have to talk it over until there's agreement, whatever it takes. After that, good communication is needed to manage it.



4G: To put it simply, that's the most difficult part in succeeding.



KI: It's very difficult, but that's exactly why communication is a good thing. Even if someone can do a job, you still need to follow up with them.



If you give a hundred Japanese-speaking internal developers all the budget and time they want to make a game, any type of developers could do a reasonable job. That much is obvious. The point is that we don't work like that.



4G: Why is that kind of environment necessary in order to aim for a global market?



KI: Because that's what the market demands. Japan's game share is only 10 percent. The numbers tell the story. As long as you're making high-budget games, which you can't finish overnight, the only way to make any income is by selling overseas.



However, no Japanese games other than Nintendo's get into the top 50 on the sales charts. So I absolutely want to make Japanese games accepted on a global scale; that's my mission.



4G: People have tended to interpret that as you abandoning Japan in favor of making titles for the global market.



KI: That's not true. (laughs) As long as I'm Japanese, the games I make will all be Japanese games. So when they sell globally, that's helping to save the Japanese game industry. It's not a matter of selling games in Japan for Japan or selling games in America for America. Dead Rising is a Japanese game made in Canada. It's not a western game.



4G: Now that you mention it, the iPhone that everybody loves is actually made in China.



KI: I wonder why people can't appreciate that about games.



=== After going independent, wanting to do all kinds of creative projects not limited to games, and right away ===



4G: However, working with western development studios is something that only you had advanced at Capcom.



KI: Right.



4G: So you'll be free to apply that Inafune method of doing things after going independent as your contribution to the game industry?



KI: Yes. We've talked about lots of things that happened before I decided to quit, but if I can add one thing to that, it's that I had for a moment wondered in vain why exactly Capcom of late is making games.



4G: Because it's not really something they want to do?



KI: Well... I get a different impression when it's put so simply, but it may be the same thing. Managers would always check to make sure that this term's numbers were in line with next term's numbers. It wasn't a matter of personally wanting to make such-and-such a game, but not being able to meet this term's numbers if you don't make the game; because you wouldn't be able to get back up to zero.



4G: But that's a problem that will follow you even after going independent.



KI: That's absolutely right, but the things I can do will increase several-fold. Even that is a plus for me.



To put it plainly, not having to shoulder the burden of 1000 peoples' salaries is a tremendous benefit. Again, if Capcom commits over 90% of its business to making and selling games, you can't deny that the head of development is under incredible pressure. I was always being driven by numbers, having to take whatever measures if they weren't enough, made to wonder how to make the numbers... I was held back from being able to do what I wanted.



That will no longer be the case. Thinking about that point, my dreams can really expand. As long as I was with Capcom, I couldn't make anything but games, but I won't be bound by that anymore.



4G: So please tell me exactly what you plan to do.



KI: There are so many things that I want to do. I won't be attached to just one title, as I don't believe that you need to rely on some IP to survive. I want to do games, of course, but also movies and novels.



4G: So you want to take on all sorts of creative endeavors?



KI: Yes. I want to be creative. I think it'd be good to not just be limited to games.



4G: Do you plan to do this after taking some time to recharge?



KI: No, I want to start right away. I'll die if I stop.



4G: Like a tuna, right?



KI: Yeah. (laughs) I want to start as soon as possible. Of course I want to make games.



4G: It'd be great if you could try your hand in the social area.



KI: Yeah, that's just one thing that's really catching on quickly.



4G: Is Capcom involved in that at all?



KI: Capcom of course understands social games and mobile games, but I don't think they really understand them.



4G: Understanding, but not really understanding.



KI: To clarify, let's use smoking as an analogy.



There isn't anybody who doesn't know that smoking is bad for you. Absolutely everybody who smokes knows it. But that doesn't mean that they understand that fact. Smokers' continuing to smoke while knowing that it's bad for them means that they don't really get it. People who understand don't act so hypocritically.



In regards to social games, it's the same deal. They just say things like, "Social games are becoming necessary," "Networked games are important," and, "Western advances are important." They may have the knowledge, but they don't really understand what it means.



4G: That's certainly not limited to Capcom.



KI: That's more than likely. If they understood, why don't they focus on western development, why don't they take social games seriously, and so on. Whenever I asked, I got answers like, "Because we're busy with other things," and, "That's on our to-do list."



It's the same with smoking. Smokers say they don't want to quit when really it's by their own weakness that they aren't able to quit. The weakness of not being able to, or not understanding, has a big effect on the body.



4G: Are you going to apply that line of thinking to everything that you practice?



KI: Like?



4G: Movies and such.



KI: Oh, right. I've always wanted to do movies, asking everyone I talk to, "How about a movie?" but getting told, "I'd also like to, but I'm busy."



I was busy too, but I did it. What's different is maybe that I'm more worried about criticism. You need to be able to accept a certain amount of criticism, but you can't worry about it too much. The reason why everyone keeps making the same titles is that if they're the same titles, they won't be criticized. If I had only made Rockman, I probably wouldn't have been so criticized.



If it's a brand-new game, isn't there always the worry that it may fail or not be well received? Not just games, but also new genres of movies face the same thing.



4G: They're too intimidating to make?



KI: Right. They're too intimidating. Of course you can't be reckless or overdo something, but you can't also be too afraid. Even with the Japanese game industry, everyone knows what's wrong but won't admit it: it's afraid. When I talk with people in the industry, they all say things like, "Yeah, you're right, Inafune-san," and, "It's really a shame that the Tokyo Game Show is dying." ...I'm just the only one who's saying it in public.



4G: But if everyone understands this, they don't need to have someone go out and say so.



KI: If it's not said, won't people be unaware?



Say a friend of yours was always saying disagreeable things. You'd have to tell them, "Hey, aren't you a bit over the line?" or, "Your way of speaking really sticks out," or, "You should be careful what you say when meeting people for the first time."



"What? Really? Am I really like that?" "Yes, you really are." So it's a matter of whether it's better to tell them or avoid it because they won't like it and it's just a bother.



4G: So you feel that you should tell them.



KI: I'm not someone who can stay quiet about it. If it's bad, it's bad. Many people haven't realized it, but I'm also included in the statements, "The Japanese game industry is no good," and, "Japanese games are no good." So I want to improve things and gain victory over it. I'm not trying to say anything presumptuous like I'm good but everyone else is bad.



I for one am trying my hardest, but I'm not there yet. That's exactly why I need to study.