Responding to Xbox One and PS4, Capcom investing $78 million to create two R&D labs in Japan

Resident Evil publisher begins construction on two new buildings in Japan as a means to "succeed in this challenging environment."

Resident Evil and Dead Rising publisher Capcom announced today that it has begun construction on two R&D buildings to be erected near the company's Osaka headquarters. Capcom will spend a total of around $78 million to build the offices and they come in response to the release of the Xbox One and PlayStation 4. Capcom says that it needs the R&B labs to ensure that it can succeed in the "challenging" and digital-focused video game market today.

"The appearance of next-generation consoles with a variety of network functions has shifted the focus of sales from conventional package software to digitally distributed content," Capcom said. "The profit structure and business model are changing at an increasing speed as a result. Furthermore, the popularity of social games due to the widespread use of smartphones is enabling games to reach more user segments and enlarging the entire game market."

"To succeed in this challenging environment, Capcom has been focusing resources on strategic and growing areas under a policy of selection and concentration in order to operate with speed and flexibility. Constructing these new R&D buildings will make game development operations more efficient by centralizing these operations and upgrading speed and control," the publisher added.

The two R&D buildings will incorporate the "latest facilities," Capcom said. They will be equipped with a motion capture room, a sound effects studio, and "multi-purpose" spaces that can hold more than 100 people.

Capcom also noted that both new R&D buildings will have seismic isolation systems to protect against earthquakes. What's more, one of the buildings even uses uneven surfaces on its north and south sides to block sun in the afternoon, thus reducing total energy consumption.

"The two buildings will enable Capcom to utilize its outstanding game development skills even more effectively," the company said. "Capcom is determined to use the new facilities to create highly original games that can meet the expectations of users."

R&D Building S is an 8-floor office with 2,054.38 square meters of floor area that is expected to be complete by January 2015. Its cost of development is estimated at ¥2.5 billion ($24.6 million). Meanwhile, R&D Building N is twice as big, with 16 floors and 10,972.87 square meters of floor space. It should be ready in February 2016 and Capcom plans to spend around ¥5.5 billion ($54 million ) to build it.

Outside of the creation of the two new R&D labs, Capcom says its general goal is to "improve quality while holding down development expenses" by bringing on development technologies and other knowledge. As a means to accomplish this, Capcom will hire around 100 people every year (mostly new graduates, they say) so the company can do more game development internally as opposed to externally.

By March 2022, Capcom said it plans to have a total workforce of 2,500 people.

Eddie Makuch is a news editor at GameSpot, and you can follow him on Twitter @EddieMakuch
Got a news tip or want to contact us directly? Email news@gamespot.com

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Discussion

127 comments
-s3r6i0-
-s3r6i0-

The Japanese are taking a giant L right now. They used to produce great games but now you have Capcom and Nintendo who couldn't sell a steak to a starving man. It'a amazing the obscene amount of money these 2 giants have to flush down the toilet.

Iamshmee
Iamshmee

These jerks need R&D just to figure out what their customers want, that's the only reason they're failing and have an "F" on the Better Business Bureau...

onefai
onefai

Good. I want to see some good games. Maybe a Street Fighters MMO?

ceaseless
ceaseless

"Capcom says that it needs the R&B"

Well I was always a fan of older Capcom music, but this?

GrenadeLauncher
GrenadeLauncher

So much for those rumours then. The only people who thought MS was buying Capcom was Xscum begging for games.

HybridExtreme
HybridExtreme

Congrats Capcom. This is a huge step in the right direction.

Devils-DIVISION
Devils-DIVISION

Great! I hope it pays off for them and we start seeing some top quality games. 

GameFan1983
GameFan1983

R&D = research & development, in video game production, R&D's job are usually researching new visual technology & implantation, coding efficiency(for each platform) and QA (less bug) different from game to game, usually R&D consumer 2/3 development cost of a game.  $78million may sound alot, but it's a nickle if it include software engineers' annual salary.   having 2 R&D labs might imply both console will have their own exclusive titles form the same developers.



zintarr
zintarr

Then they scratch their heads at the end of each year wondering why they are again in the red.

zanychelly
zanychelly

Major question: R&D to create great games, or R&D to create more bullshit like Resindent Evil 6?

Senor_Kami
Senor_Kami

I thought the Phanta Rei (sp) engine was their next-gen R&D...

cannedstingray
cannedstingray

I'm assuming there is a type-O in the beginning of the article, and they don't really plan to build an R&B building. Although if true, one of the buildings is for research and design, while the other one is dedicated to rhythm and blues? Not sure how that will translate to profit for them, maybe they are getting into the club scene to finance making games

Dragerdeifrit
Dragerdeifrit

lol yet the guy who made minecraft became more succesful than that entire company... you don't need an army of 2,500 medicore employees and million of dollars on assets. you only need a couple of taleneted ppl like inafune and mikami having good ideas then have another 100 above the average employes making the game. that's it.  I rather have 1 Enstein solving a math problem than 2500 monkeys.

PlatinumPaladin
PlatinumPaladin

Good news everyone! Actual good news!

I was hoping a publisher somewhere would eventually create a new studio, but I didn't expect anyone to actually build new buildings for them. I certainly didn't expect Capcom to be the ones to do it. Good on them, and I hope it pays off. I just hope they don't use them to create a load of F2Ps.

Freboy
Freboy

With all that space... is there by any change room for a WRITER in the new building? I mean, I think Capcom has the graphics part pretty locked down already but having the producer's 9 year old sun write the story doesn't really work anymore. 

RoachRush
RoachRush

I didn't think Capcom even had that kind of money to spend at the moment. But hey, if they can release Dragon's Dogma 2 and build up the great features of the first game, they can have my money again!

MegaPhilX2
MegaPhilX2

I was wondering what they were up to. Will they have anything to announce at e3?
Because they haven't been making many games lately...

blastergamerx
blastergamerx

Considering that Capcom hires 100 people every year (if they will) and new people, that means it's great for those who just got educated from college and the economy (Japanese mindset pro), but thinking about development, there would be too much newbies in the dev team, then how can Capcom make the games on-the-path gameplay from sequels without dumbing them down?? Ok if Mobile games is the focus, then there is no big buildings required for small games with limited game data size.

Harrason
Harrason

Considering their focus on the mobile game industry as of late, the prospect of them looking at a small mobile game console that can be utilized with smartphones in anyway doesn't seem to be too far off the mark.


And with the measly amount of cash in their bank reported last year, this seems like a really risky effort to me.

Chatch09
Chatch09

Am I the only one offended by the opening: "Resident Evil and Dead Rising publisher"... ummm, Monster Hunter? Devil May Cry? Mega Man? Marvel Vs. Capcom? Breath of Fire? Zelda on Gameboy? STREET FIGHTER?!!?! 

So many more great titles...but Im glad they had the guts to make a move like this, can't wait to see what comes out of it.

rarson
rarson

It's great that they're building R&D labs, and intriguing that they're discussing mobile (I would guess that they're expanding into that market). But wouldn't it have been cheaper to just buy some existing buildings?

AyatollaofRnR
AyatollaofRnR

"Capcom says that it needs the R&B labs..." It's getting into the music industry?



Capcom started last gen so well, but went down hill over the last half. 


hystavito
hystavito

This seems like very Japanese style thinking, to actually construct your own buildings, yes?  Or maybe not, someone care to comment?

pupp3t_mast3r
pupp3t_mast3r

Seriously? almost 80 million on buildings? Can you guys bring back decent Resident Evil, Dino Crisis or Onimusha games? Heck at this point I would even settle for a port/remake of the classics and I imagine a lot of the fans of either franchise would as well!

DrKill09
DrKill09

If you only have $152 Million left, why would you spend $78 Million on two buildings?  Weren't you guys hemorrhaging enough money already?!


You guys are going to be the next Midway, the next THQ... enjoy.

daviz88
daviz88

just make better resident evil games, and if its not too much trouble bring back ONIMUSHA 

streamline
streamline

Starting to build new facilities now makes more sense for PS5 and Xbox 2.

battlefront1943
battlefront1943

Capcom, I understand you're building to cut costs, but that's a long-term proposition that won't pay off for many years.  In the short-term, really think about giving RE a break, bringing out DRAGON'S DOGMA 2, and bringing MONSTER HUNTER to western consoles.  Also, ever going to revisit ONIMUSHA?   

HybridExtreme
HybridExtreme

@zanychelly  That's your opinion. Mine is that Resident Evil 6 is a masterpiece which is commonly misunderstood by it's fans and by the general ignorant public. Not saying you personally are ignorant, just people in general. I'm sure you have your reasons for not liking RE 6 just as I have mine for loving it. I bet we can both agree on this though: "Remember me" is completely forgettable!

Senor_Kami
Senor_Kami

@Dragerdeifrit  You do if you want to make non-PS1 looking games and more than one of them at a time.  Insane that so-called gamers are spinning a developer/publisher investing heavily into game development as a bad sign.  Kids say the darndest things.

Senor_Kami
Senor_Kami

@RoachRush  They put out a report that they had like $150M in the bank and were making like $20M in profit per quarter and gamers took that as a sign that they were going broke.  Stuff like that is a good reason to ignore any "logic" or "insight" a gamer pulls from anything put out on the internet.

PlatinumPaladin
PlatinumPaladin

@blastergamerx  They could shuffle the new people in with pre-existing developers and move some of the seasoned staff over to the new teams. That'd give them that balance of fresh talent and experience everywhere.

yxw
yxw

@AyatollaofRnR  

Well since they just signed the new/old retro band " M. Bison and the Zangeif's" it really isn't that surprising. Lets just hope that Dante and Ashley get back together for their much awaited follow up to " Leon Help".... Her voice was so good in that and Dante is a solid backup!!!

jhcho2
jhcho2

@hystavito  

Land is outrageously expensive in Japan. In the long run, you'll lose more money from the rental fee

trotz75
trotz75

@chev9346 you call everyone fanboys, your all over the place, fanboy this fanboy that, and all in the name of......well nothing it's just usually random Crap you come out with that don't make sense. You try so hard to be a troll, which should b easy, but you make it look hard!! Failing at being a troll, is there anything more pathetic?????

wargreymon559
wargreymon559

@chev9346  No scamcom fanobys are as worse as  xbot fanboys.Who supported DRM policies and were treated like puppets.

LordKaizer
LordKaizer

@DrKill09  lemme remind you they don't want to make new mega man game because of money. 

-s3r6i0-
-s3r6i0-

@HybridExtreme No. You're the ignorant one and you suck. Resident Evil 6 is something to wipe your ass with.

nootakus
nootakus

@HybridExtreme Nah you're the ignorant one it sucks. And stop posing as a fanboy to oppose everyone and try to sound cool.

nootakus
nootakus

@Senor_Kami Yup windy ghetto, everybody. It's a fact, and two new buildings don't mean the company is doing well let alone like the good old days either. Your apologist and fanboyish anti-logic rubbish post like that is a good reason to ignore any "logic" (ha no) or "insight" a grown otaku gamer pulls from anything put out on his little brain.

tsunami2311
tsunami2311

@chev9346 @Chatch09 I want another BoF game but with there track record as of late and what they did with BoF5 I not sure i want Them to touch it, 

rarson
rarson

@jhcho2

So how does building two buildings from the ground up compare to buying two existing buildings in Japan, oh wise one?

trotz75
trotz75

@chev9346 "a troll like you" "go take the walk of shame" you've said that in your replies to people about ten times, you've obviously got no imagination and just rely on childish remarks, it's as bad as saying "I know you r I said u r so what am I then"? Ner Ner Ner Ner Ner Ner