Capcom takes agenda global

Gamers Day message rings loud and clear: Made in Japan, played 'round the world.


LAS VEGAS--In a sprawling complex of meeting rooms off the Venetian Hotel's main casino, one of Japan's biggest and most recognized publishing houses--a company that in its 28 years has successfully bridged the gap between the arcade, home, toy, and broader entertainment markets--did its best to convey to a group of about 100 journalists that it was ready to compete on a new stage.

In the company's opening presentation yesterday, and later in closed-door meetings with Capcom's new boss in the States, senior vice president of sales and marketing Mark Beaumont (pictured, right), the message was one of an evolved outlook. The executive's presentation suggested Capcom was realigning itself from the ground up--going from a game company in Japan that thought first of its home market and then foreign territories to a company that thinks big--from the start.

"What we're trying to do is take a more global view to the products that we create," Beaumont said after the morning's presentation.

The approach is founded on basic principles that take into account both market size and market strength. Beaumont said the new perspective is based "partially on the basis that [North America and Europe] are very large markets--there's no reason why we shouldn't be successful in those territories--and partly on the basis that the Japanese video game business has been soft over the last few years."

The result is intuitive. "For the company overall to perform effectively," added Beaumont, "it really needs to operate effectively in all three territories."

In comments to the general group of attendees, Beaumont struck an expected pose. He came out firing on all cylinders, suggesting that Capcom had the depth and experience to endure the expected doldrums of a console transition and maybe even benefit from it.

"The industry is faced with many challenges, but we look at that as an opportunity," Beaumont said, highlighting the fact that Capcom has done particularly well at launching franchises during previous transition periods.

He then outlined a couple of success stories to prove his point, commenting on the fact that the Resident Evil franchise was launched one year after the original PlayStation was introduced, as well as the anecdote that within the first year of the PlayStation 2's launch, the company released its first iteration of both Onimusha and Devil May Cry.

But success today, said Beaumont, will mean going beyond software. "It's no big secret that R&D costs are going to be more [for next-gen platforms]. This means we will rely on other channels of profit: not just next-gen, but mobile, and merchandising."

Beaumont called it a "games and more" strategy--one that will influence Capcom's thinking going forward.

Wrapped around the strategic messaging of the company's Gamers Day event was the expected gift wrap that showed off a slew of upcoming titles.

Clover Studio president Atsushi Inaba presented Okami, a game "based on an action shell, with elements of role-playing and adventure all mixed together, but accessible to all kinds of people," as he described it. Recalling the demo that was promoted at last year's Electronic Entertainment Expo, Inaba said that demo "was not even a 10th of what the game will be."

To bolster the game's depth, he admitted that "it's no big secret that Capcom is good at making action in an action framework, we've added an adventure element and a deep story, to make the game feel like a full experience."

Inaba went into some detail about the "celestial brush," the mechanic that lets gamers direct the movement of game characters and also affect the gameworld--"to draw a line that transforms into a vine, to draw water in the direction of a fire to put out that fire, to attack enemies and solve puzzles, to create wind."

Inaba said the Clover team was nearing completion of the title. His parting words: "We're doing our best to make sure it's a great game, and we hope you feel the same."

Hironubu Takeshita, a Capcom producer, followed Inaba, presenting a slew of portable titles, including Ultimate Ghosts 'n Goblins and Power Stone Collection for the PSP. Then, Midori Yuasa, the company's head of Capcom's new wireless game division in Los Angeles, gave a brief introduction of Capcom's ambitious mobile strategy.

The new division has already placed one game with a carrier--a Mega-Man title that Verizon has picked up. Yuasa plans on placing nine more titles with carriers before the end of the calendar year. She commented on a deal just inked with Amp'd, an MVNO (Mobile Virtual Network Operator) that taps Verizon's EVDO network, and other youth-oriented deals that were in the works.

Yuasa's goal is to leverage what she calls the "unique influences and potential" of mobile games to bring Capcom franchises to gamers on the go. But the games will come with a twist. Drawing on her tenure at Sony Pictures Digital and that company's successful track record with mobile iterations of Sony-owned franchises, including Wheel of Fortune, Yuasa said she will focus on a subscription model that would see new episodic content being made available to mobile gamers at monthly intervals. The Phoenix Wright: Ace Attorney mobile game, for example, will offer users a new case to download and investigate each month.

As well, the division will capitalize on a "viral" component where the user can send a text message from within the gameworld to a friend. The message will invite that friend to download the game and, in this case, join the Phoenix Wright community of mobile gamers.

After Yuasa left the stage, Keiji Inafune delivered updates to two games Capcom makes no bones about being the two cornerstones of its 2006 strategy--the zombie-killing actioner Dead Rising and then the postapocalyptic Lost Planet, both due for the Xbox 360 (and Lost Planet is due for mobile gamers as well).

A Dead Rising video engaged the room of journalists with its nonstop action (which one hard-bitten journo said reminded him of "Shawn of the Dead without the pals and without the moms with nasty zombie bites to kill").

Inafune said the team "is getting closer and closer to finishing R&D on the title." And in spite of the nonstop mayhem of the video, Inafune did his best to paint a backstory where the playable character must always choose to "save people, chase the scoop, or save his own neck."

The Lost Planet presentation was accompanied by the game's director, Oguro-san, playing through a couple of in-progress levels set in a snow-bound cityscape with an entourage of menacing mechs to slay.

After the 90-minute presentation and lunch, GameSpot sat with Mark Beaumont to get an inside look at what's driving strategy at Capcom USA and at HQ.

GameSpot: The question on everyone's mind: Why wasn't Resident Evil 4 a competitor at last week's D.I.C.E. Summit?

Mark Beaumont: To be honest, we're not a member of the organization. Not that there's anything necessarily wrong with the organization, but the point at which I was told that we needed to either join or it wouldn't be included, it was so late in the process there really wasn't time to react.

GS: What are the most important or significant takeaway items from today's presentation?

MB: First and foremost, the creativity that the company brings to the table and particularly as we're using it now, in relation to the next-gen consoles.

With the creation of Dead Rising, with the creation of Lost Planet, we feel we have new franchises for the company that will be successful for many years.

Number two is the continuation of our significant franchises on new platforms. You're seeing Mega-Man on the PSP, you're seeing Street Fighter on the PSP and the PS2 and Xbox 360. We're basically leveraging the assets across multiple platforms in order to be successful, so I think that's important.

And the mobile initiative is one where we've had a great deal of success in Japan. We know that our competitors are investing in that category--in some cases heavily, as EA is with Jamdat--and we certainly see it as a growth opportunity as well. It's time for us to put a stake into the North American marketplace and that's what Midori Yuasa is now doing for us.

GS: Your overarching agenda at Capcom USA is what?

MB: I think the most important thing to look at is that we have always been a very strong Japanese company--very dominant in the Japanese marketplace--but have not necessarily been as strong in the North American and European marketplace. And by that I mean that Japan has always been the largest percentage of the worldwide business.

What has brought me to the company, and what the company's objective is, is to start building its business further in North America and Europe.

GS: The reasoning is what?

MB: Partially on the basis that they're very large markets--there's no reason why we shouldn't be successful in those territories--and partly on the basis that the Japanese video game business has been soft over the last few years. For the company overall to perform effectively, it really needs to operate effectively in all three territories.

GS: How much of what you do is going to be a subset of what originates in Japan? Do you have any strategies that would involve some creation of product coming from non-Japan markets?

MB: What we're trying to do is take a more global view to the products that we create. Some of those we've already done a very successful job with: a Resident Evil or something of that nature, for example, where it sells in all territories successfully. But there are other [products] where with appropriate input early in the process can [result] in a more global product that will perform better in [all] territories.

GS: And that requires sensitivity to what?

MB: You need to have an understanding of the culture of the American marketplace, the culture of the European marketplace, integrated with the culture of the Japanese marketplace.

When you've got a concept, that, if you changed [a game] by 10 to 20 percent, well, all of sudden you may get a much more marketable product in North America. But those are the strides you need to take early in the process in order to be successful. That's part one.

Part two is we are looking to have initiatives in North America and Europe where we would [be] doing development in those territories. I don't think that's going to ramp up dramatically, so I wouldn't expect us to be doing 10 games in North America next year, but we want to selectively pick the opportunities where we can do something that is either specifically for North America, or specifically for North America and Europe. Or, in the perfect world, is appropriate for all three territories.

But we do feel that we need to source product in North America and Europe to be successful in those territories as well, in addition to what we bring in from the Japanese marketplace.

GS: Are you the person who's going to drive that strategy and green-light those products?

MB: There is a group of probably about four to five people in the North American operation who will be responsible for that. That would include Mr. Tobisawa who is the CEO of the operation, myself, and people within R&D, both in North America and in Japan, making sure that the products and the concepts actually make sense. But I'll probably be pivotal to that role, yes.

GS: What do you bring from your experience at Midway? What do you draw on that you plan to bring to your current job at Capcom?

MB: I think the biggest thing that we learned with Midway was not all teams can necessarily make the transition from the arcade to the consoles as effectively as others.

[At Midway], it led to a fair amount of overhaul over the last six years. I was there for [that] six-year period. Capcom is further down the curve, and in all fairness, what they have done with Resident Evil or Devil May Cry, what they've done with new original content has been very successful on the console platforms.

There are still some things that I might have done with Midway--being involved in long-term product planning, involved in the structure of the organization, and how to best optimize what we do in the marketplace. There are probably some parallels [here] to what I might have dealt with with Midway.

More than anything else, I think what I bring to the table is not just the experience with Midway, but 20 years of experience in the industry and having gone through five platform transitions. The lessons learned from those can help position you for the future.

GS: What's your biggest concern for the future?

MB: The biggest thing that I'm concerned about right now is that we plan our franchises and plan our new IPs and strategically plan our future for continued growth. It's an area that I'm already working on with individuals in Japan. And to be completely fair to the company, some of the underpinnings of that were already in place. But we're trying to bring research, genre planning, SKU planning into the mix that will help embellish what we already have in place with the company.

GS: Is it too easy to say that you're bringing a more scientific and data-driven approach to the organization?

MB: I think we are adding a level of data and research to the organization that may not have been there in the North American territory. What you ended up having was a lot of good data on the Japanese market and not as much data on the North American and European markets, which would tend to skew the direction you might be going as a company. By providing the level of data on the US side, and we will be doing so on the European side as well, it gets back to that whole point of creating worldwide products. We'll be able to base our decisions on a worldwide market, understanding the genres and trends that are successful in each territory and trying to find the homogenous blend of those so that you do more games that can sell worldwide.

GS: What markets do you feel hold the most potential for Capcom? Both near-term and long-term?

MB: I think North America is probably our easiest target right now, because we have areas that we think we can be much more successful in than we might have been in the past. I'm not going to drill down too far on that answer, but I do think there are a lot of things that we can do here that we can be more successful at. Europe also has a lot of potential.

GS: Expansion into China? Something tells me that's just not part of your agenda right now...

MB: It is clearly an emerging growth area and it is something that you know, for your 5 to 10 year strategy you really need to have a strategy for Asia globally, if you will, so globally, Asia. But whether that's the most important thing we do right now, I don't think it is. Optimizing our performance in North America and Europe is higher priority.

Kazuhiko Abe (Head of Corporate Strategy, Capcom Co. Ltd.): We'll have the long-term view, we'll look into it, but you can just tell from looking at some of our competitors and the amount of effort they're putting against that territory, it's going to be a growth area.

GS: Is there a little bit of, where EA goes, others are tempted to follow?

MB: It's not that so much. We probably have a better understanding of the culture, because of who we are, than perhaps an Electronic Arts might, but it's more that the economy and that marketplace is growing at a fairly rapid rate and providing a lot of opportunities. If you see that many people as an emerging market, it's pretty hard to resist.

GS: In order, which do you consider your strongest titles going forward, and why?

MB: Well, it's really easy to do one and two because that's Lost Planet and Dead Rising, but I'm not at the point where I would necessarily stack-rank them. I think they both have an excellent opportunity to be successful. They're creative, and Dead Rising shows off the technology of the Xbox 360 as well as anything, if not better than anything, I've seen. The fact that you can have hundreds of characters independently moving onscreen at the same time in the midst of the game play is pretty unique. And without an Xbox 360, you couldn't do it.

Lost Planet, I think, has the opportunity to be an epic title and really put the whole cinematic element on top of the game play to give you a movie-like experience.

They're both coming out on a platform that's got a growing installed base and I think the opportunity for them to be showpieces is extremely high. So those two are clearly the biggest two that I think we're showing.

GS: Is it difficult to get behind the Xbox 360 in Japan given the hard time that it's had making inroads with consumers?

MB: I think it's the perfect example of Capcom taking a world-view. If it doesn't perform as well in Japan because there just isn't an installed base but it sells extremely well in North America and Europe...well, we're looking at a global market. That as much as anything is what drove that decision.

GS: What keeps you awake at night when you think about the growth opportunities that you have as an executive at Capcom?

MB: I think it's probably true of virtually every business--it's the integration of marketing and product development to create world-wide products. It is in some cases and this is partially the legacy arcade company, if you will, the arcade development teams really didn't interact with marketing because they didn't have to. They just created products and then they went to market and that was that.

It's really innovating between development and marketing, so that the two sit down and work together as a team early on in the development process so that you have games that are not only creative but also marketable.

And that integration is always a challenge and you never completely solve it. You know you could have the best teams working together in the world but there will always be some friction between product development and marketing--and I want it because I want the product development team pushing the envelope.

That's where you want the marketing overlay to say, "Great technology, guys." And this is where I think we've ended up with Dead Rising--great technology, now let's turn it into a game, which the team has done.

And it's that marriage of people. In our case, it's the marriage of a Japanese group and a US group and a North American group with marketing and product development all working together. That is probably our biggest challenge but, at the same time, I think it's something that we can absolutely do.

GS: Are you enjoying the new assignment?

MB: I like it a lot. I am particularly impressed with the caliber of talent that the organization has on a worldwide basis, and as you can see from some of the games we showed today, the creative talent and the development talent is excellent. That's a real nice hurdle not to have to jump over. If you already have a foundation of quality development, the rest will take care of itself.

GS: Thanks very much.

MB: Thank you.

For more on the event, check out GameSpot's full coverage of Capcom's Gamers Day event.

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