Microsoft targets Japanese game market

CHIBA, Japan -- Microsoft will be releasing games developed by top Japanese designers for its Xbox 360 console, a senior executive said Thursday, the latest effort by the U.S. software maker to make inroads in a market where it has long struggled.

John Schappert, Microsoft corporate vice president of interactive entertainment LIVE, software and services business, was also trying to woo more Japanese game designers while in town for the annual Tokyo Game Show.

"My message to you today is that we believe Xbox 360 is the platform best equipped to help Japanese publishers succeed on a global basis," he said.

The trade show, which showcases game machines and new software, had a media preview Thursday in this Tokyo suburb. It opens to the public Saturday.

Sales of Microsoft's Xbox 360 in Japan have lagged behind the offerings from Japanese rivals Sony and Nintendo. But Microsoft has long been eager to get a piece of the country's estimated 677 billion yen ($6.8 billion) video game market.

Schappert said works from Japanese companies that have produced blockbusters in the past, such as Square Enix and Bandai Namco, were in the works for Xbox 360 for the Christmas season and next year.

"We're in a great position and we're very proud of that," he said of the growing partnerships with Japanese game developers.

He said the recent price cuts the Redmond, Washington-based company announced make Xbox 360 a good deal.

The cheapest of three models, Xbox 360 Arcade, is now priced at 19,800 yen ($198), down nearly 30% from 27,800 yen ($278) — making it the cheapest of next-generation consoles in Japan. Microsoft also slashed the prices on its higher end models.

Nintendo's Wii costs 25,000 yen ($250), while Sony's PlayStation 3 model sold in Japan is priced at about 40,000 yen ($400).

But some analysts weren't as optimistic.

Hiroshi Kamide, analyst at KBC Securities Japan in Tokyo, said Xbox 360 wasn't about to make huge advances in the Japanese market, adding that it still needs more games that appeal to Japanese fans.

"Microsoft has been the most aggressive cost-cutter," he said. "Pricing helps, but that's not the entire story."

Square Enix's Dragon Quest series have been a big hit among Japanese but have been available so far only on Nintendo and Sony machines.

The latest Final Fantasy game will be available on the Xbox 360 in North America and Europe but not in Japan — which will give an advantage to Sony's PlayStation 3.

When questioned about that, Schappert declined comment.

Microsoft has sold 20 million Xbox 360 machines worldwide, while Nintendo has sold 29.6 million Wii consoles. PlayStation 3 sales have lagged behind at 14.4 million worldwide.

Schappert told The Associated Press the company was getting close to its goal of selling 1 million Xbox 360 machines in Japan.

He said sales of the console have been strong recently and some Japanese stores have sold out.

Microsoft's efforts come at a time when Japanese game developers are growing more ambitious about expanding overseas. A game is considered a hit if it sells a million copies in Japan, but an international hit sells about five times that.

Capcom President Haruhiro Tsujimoto, who was also at the game show, said the industry was growing globally and needed to focus on international appeal.

"We have to think about how we can be the No. 1 game maker in the world," he said.