WSJ.com - Microsoft Taps Top Designer To Win Over Japan's Gamers Page 1 of 2 February 25, 2005 Microsoft Taps Top Designer DOW JONES REPRINTS This copy is for your personal, To Win Over Japan's Gamers non-commercial use only. To order presentation-ready copies for distribution to your colleagues, By PHRED DVORAK and ROBERT A. GUTH clients or customers, use the Order Staff Reporters of THE WALL STREET JOURNAL Reprints tool at the bottom of any February 25, 2005; Page B3 article or visit: www.djreprints.com. Microsoft Corp. said it has signed on the creator of Japan's most popular fantasy game • See a sample reprint in PDF to produce titles for its next-generation Xbox, in the company's latest bid to win fans for format. its game consoles in Japan, the world's second-largest videogame market. • Order a reprint of this article now. Microsoft said Hironobu Sakaguchi, the originator of the Final Fantasy game series, has agreed to make two role- playing games exclusively for the next version of its Xbox, which is expected out later this year. Xbox Japan chief Yoshihiro Maruyama declined to say when the games would come out but said it likely would be "slightly after" the console launch. He said the games also would be aimed at the global market. INSIDE TECH The deal with Mr. Sakaguchi is a crucial step for Microsoft as it prepares to launch its next videogame console. Its first console, the Xbox, has been popular 1 See more coverage2 of Asia's in the U.S. -- the world's largest videogame market -- but a failure in No. 2 technology sector, from cellphones market Japan, which is also the home of videogame-console rivals Sony Corp. to software. and Nintendo Co. Since its February 2002 introduction, the Xbox has sold 463,000 units in Japan, according to game-data tracker Enterbrain Inc. That compares with 3.7 million units of Nintendo's GameCube, which was launched five months earlier, and 17.2 million units of Sony's PlayStation 2, which came out in 2000. Microsoft needs to sell more consoles in Japan in part to attract stronger support from Japanese game developers such as Konami Corp. and Capcom Co. These companies do a lot of their business in their home market and hesitate to make games for consoles that haven't seen at least a million units sold domestically because it isn't worth the cost of game development. Without those Japanese games, the Xbox's offerings have been heavy on the shooting and sports games popular in the U.S. -- and light on the role-playing and fantasy genres that Japan's gamers favor. Microsoft Vice President Peter Moore said the agreement with Mr. Sakaguchi should help Microsoft build games that are more "relevant and pertinent for Japanese consumers." He acknowledged that such games were "sadly lacking" for the Xbox. With Mr. Sakaguchi, Microsoft gains a legend in Japanese game culture. While at Japanese game maker Square Co. -- now Square Enix Co. -- Mr. Sakaguchi created Final Fantasy, one of the most popular videogame franchises in the world, and an enduring hit in Japan, where it is soon to launch its 12th iteration. Snagging the Final Fantasy franchise was seen as important in helping Sony successfully launch its first PlayStation console. And in attracting Mr. Sakaguchi, Microsoft has shown that it is building the credibility and connections needed to do business in Japan's game world: Mr. Sakaguchi said he decided to work with Microsoft in large part because he knew http://online.wsj.com/article_print/0,,SB110927422622263371,00.html 2/26/2005 WSJ.com - Microsoft Taps Top Designer To Win Over Japan's Gamers Page 2 of 2 and trusted many of the company's Japanese staff -- including Mr. Maruyama, who for years worked at Square. Mr. Sakaguchi declined to disclose details of the games. Financial terms of the agreement weren't disclosed. It has been years since Mr. Sakaguchi has had a hand in the Final Fantasy series so there is no guarantee that he can field another top-selling game. Mr. Sakaguchi will produce the games in Japan through his Tokyo-based company, MistWalker. Write to Phred Dvorak at [email protected] 3 and Robert A. Guth at [email protected] URL for this article: http://online.wsj.com/article/0,,SB110927422622263371,00.html Hyperlinks in this Article: (1) http://online.wsj.com/technology/asia (2) http://online.wsj.com/technology/asia (3) mailto:[email protected] (4) mailto:[email protected] Copyright 2005 Dow Jones & Company, Inc. All Rights Reserved This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. http://online.wsj.com/article_print/0,,SB110927422622263371,00.html 2/26/2005.