Chuo University Speech(Nov 25th, 2011)
"The Structural Transformation of the Game Industry"


Slide 19 illustrates the basic substance needed to induce the chemical reaction.

First is globalization. This is a big must so I will be quick. I am talking about the regime to develop and sell globally. But our view is more proactive. Our intention of becoming global has more to do with securing mobility and agility of talents, as well as the marketing dimension. We are unique compared against the peers, in a sense that we segment the business based not on regions but by the consumers’ preferences. To sell to an American, we don’t need to create in the US. A guy in Akihabara may share the same hobby as the a young guy in London, but maybe not like what the middle aged shop owner in Akihabara may have on his mind. Because of how this all plays out, globalization becomes more important, and network as a part of the infrastructure must be readily available.

Next is going online. Obviously, content design must be enticing, but the design of the business model is very critical. Horizontal model will replace vertical integration, but it will not be a horizontal integration, and each layer will be fragmented. We don’t know what the final picture will look like, so we are doing the experiments on each of the layers.

Last one is having our own IP. I’m not talking about patent. This is about copyright issues. The copyrights have different scope of protection depending on which media your IP is associated with. However, as I anticipate further shift to network environment, globalization, and fragmented layers, it’s extremely difficult to know how we want to use the contents and in what form and ways. This on the other hand implies that we cannot do business unless we own the whole thing. That is the very reason why I am so persistent about having our own IP. If you do a collaboration project with a content owner, you can enjoy that moment, but cannot keep winning for ten years. It’s because just as soon you change your business model, you have to rewrite the contract again. You can’t own the momentum that way. So these are the three pillars that I focus on.

Page Top