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."

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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.

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"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.

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