Jason Hidalgo

jhidalgo@rgj.com

Technobubble covers games, gadgets, technology and all things geek. Follow Technobubble poobah Jason Hidalgo’s shenanigans on Twitter @jasonhidalgo or his Tabiasobi Youtube channel

It’s been said that history is written by the victors.

If that’s the case, then the recent history of Japanese game developers is one marked by morale-crushing retreat in the last few years.

It wasn’t always this way.

Following Atari’s collapse and the video game crash of 1983, it would be a Japanese company that would come in and save the day. Initially known for making “hanafuda” playing cards, Nintendo started dabbling in electronic games in the 1970s, eventually releasing fun projects such as its Game & Watch series in the 1980s. It would eventually parlay its electronics expertise into the Family Computer, an unassuming piece of kit that would be redesigned and renamed as the Nintendo Entertainment System in the United States — the latter serving as inspiration for the hard-to-find NES Classic Edition.

WATCH VIDEO: Solving NES Classic Edition's short cord woes

The Famicom’s success would kickstart the birth of a powerful gaming industry in Japan, one that would only grow with each successive home console iteration. By the time the PlayStation 2 became the system of choice for console gamers, Japanese game developers were clearly in the driver’s seat. This occurred despite a shift from 2D to 3D gaming, which Japanese gaming companies successfully parlayed into reimagined favorites like Final Fantasy or beloved new IPs such as Resident Evil.

A series of perfect storms, however, would loosen Japanese devs’ Vulcan death grip on the gaming industry’s neck. One involved the rise of first-person shooters, something that Japanese game developers initially ignored because they weren’t popular on their home turf. This allowed Western developers to dictate and dominate the genre, which would eventually explode in a big way outside of Japan and even help Microsoft’s Xbox 360 wrestle the console crown from former leader PlayStation for a huge chunk of the previous console generation.

Then came open-world games, which would be dominated by Western developers once again such as Rockstar and Bethesda. This one particularly stings given how Shenmue showed that Japan could do open world games, too, and with a solid combat system to boot. Unfortunately, that series fizzled out because it was made for an underrated and doomed system in the Dreamcast.

Trouble at home

All that being said, Japanese developers’ failure to adequately serve Western gamers’ tastes would not be as big a problem if its domestic gaming market stayed strong. While the gaming market outside of Japan continued to grow, however, domestic consumption started to head in the wrong direction. A declining birth rate, a key factor for many of Japan’s socioeconomic woes, could be seen as one reason for the gaming market’s stagnation, as well as the underperforming economy. What would ultimately deliver the killing blow to Japan’s traditional gaming model, however, was mobile games and apps.

Thanks to small living quarters and their propensity for commuting, Japanese customers already showed a preference for gaming on the go as shown by the success of Sony’s PSP and Nintendo’s line of portable systems. Once powerful smartphones replaced traditional flip phones and Japanese consumers started flocking toward mobile gaming apps, however, it appeared that the writing was on the wall for console gaming.

Add the fact that Japan’s dwindling console gamers also started to appreciate shooters and open-world games, and Japanese developers suddenly found themselves in a proverbial no man’s land. In 2002, for example, Japanese games accounted for 50 percent of the global gaming industry, according to the BBC. By 2010, that was down to 10 percent. Just a year earlier, former Capcom-producer-gone-independent Keiji Inafune infamously raised many eyebrows at the 2009 Tokyo Game Show after declaring that Japan’s video game industry was not only “done,” it was “finished.” (Apparently, the first point was not strong enough to convey its doneness for Inafune).

Inafune — who would go on to found Comcept a year later — went on to compare the once mighty industry to a wilting tree, telling The Verge that it still stands tall but is essentially dying inside.

Although Inafune’s assessment might sound brutal, it also wasn’t off base. After putting most of their focus on the domestic gaming market for years while treating the West as the second item in a buy-one, get-one free deal, the changes in video game trends and consumption ended up catching the big Japanese game developers with their “hakamas” down. In some cases, it led to mergers between companies such as Koei Tecmo. Other times, it caused stalwarts such as Konami to focus more on their slot machine and pachinko business.

For console gamers weaned on Japanese titles such as myself, the last 10 years felt like a new Lost Decade. The funny part is that the Japanese gaming market actually hit a record $9.6 billion in 2014, according to Famitsu. The bulk of that — a whopping $5.8 billion — came from mobile gaming. Traditional console games, meanwhile, fell to their lowest level since 2005, and the actual numbers could be worse because Famitsu only started tracking the numbers starting at, you guessed it, 2005.

Meanwhile, not only did it feel like traditional game releases by Japanese developers were few and far between, the ones that they did put out in the West would, at times, seem schizophrenic — like they didn’t know how to please Japanese and Western gamers alike. One needs to look no further than Resident Evil 6, which featured an unfocused, hodge-podge design akin to a gaming Frankenstein in an attempt to be everything to everyone.

Granted, you still had stalwarts from Japan such as the Dark Souls series, Monster Hunter, Persona, Pokemon and the like but not at the pace I remember seeing during Japanese gaming’s heyday. After dominating the gaming industry for so many years it seemed as if dusk was finally upon the Land of the Rising Sun’s console gaming landscape. When I try to think of games I truly enjoyed during the last console generation, for example, they were usually dominated by Western games like Mass Effect, The Witcher and the Batman Arkham games — with the occasional Valkyria Chronicles and Bayonetta showing up to remind me of how much I miss the prolific days of Japanese studios. After years and years spent hoping for a comeback, I started to wonder, maybe it’s never going to happen.

That is, until 2017.

Seeds of a comeback?

I was already feeling hopeful toward the end of last year after playing games like Last Guardian and even World of Final Fantasy, both of which felt solid and unapologetically Japanese. It would only serve as a prelude to 2017, however, which not only kicks off with several Japanese games, but Japanese games that are actually really, really good.

You’ve got the 800-pound gorilla in “Legend of Zelda: Breath of the Wild,” which not only serves as the perfect accompaniment to Nintendo’s new Switch console but is now in the conversation for best Zelda game of all time. There’s Persona 5, which I’m still going through and is serving up an excellent representation of the JRPG formula. Nier: Automata is easily one of the most surprising games I’ve ever played and shows the kind of daring risk-taking and experimentation that companies like Capcom used to display back in its heyday, something that fittingly lives on in Platinum Games.

Speaking of Capcom, the developer has demonstrated its own comeback with Resident Evil 7, an excellent re-imagining of that series that purposefully takes it in a new direction mechanically according to its producer Masachika Kawata. Koei Tecmo and Sega delivered this year as well, with Nioh and Yakuza 0 respectively, both of which are great titles that could contend for top-game lists. I also had a lot of fun with Gravity Rush 2 and Snipperclips, which deliver a different experience from the norm for action-adventure and puzzle fans.

I can’t even remember the last time I saw a year that kicked off with these many quality Japanese titles. It has honestly been that long ago.

So what happened? Well, after being afraid of taking risks and simply being themselves, it looks like Japanese developers are finally figuring out their place in the current gaming hierarchy. Part of it involves increased confidence in doing what they do best instead of relying on a design that seems straight out of a bad focus group. Another is truly embracing gamers outside of Japan and, in some cases, an increased willingness to look at non-traditional markets such as Steam, which is helping supplement the decrease in domestic gaming consumption in Japan. Certainly, mobile gaming is here to stay but it seems like Japanese developers are finding that happy medium where they can churn out mobile games without abandoning the traditional plaforms that built their companies in the first place.

Of course, the question now is whether this newfound momentum is real or just an aberration. Heck, I just might have jinxed this whole thing. As a big fan of Japanese games, however, I would love nothing more than for this comeback to continue. Words can’t even describe how sad I felt during my last trip in Japan and seeing how much my console gaming options have dwindled while more and more people turn to smartphone games. It was like a piece of my childhood was dying.

Anyway, I’m not quite calling it a comeback yet. On the other hand, it looks like Japan's towering tree is at least starting to sprout a lot of buds once more.