Square Enix goes multiplatform, focus on quality then quantity

[Systemshock2023]

About damn time. Welcome to the 21st century. Now the fool in vanillaware is the only one remaining.

 

[Eternal_Wings]

In cold print is written here, that without the exclusive games Square Enix revenue & operating income would have tanked way more.


Square Enix is to be embrace a rude awakening.

 

[Puff]

Square, Capcom, Sega, Atlus, From, Arc Systems. They lost everybody

Honestly I can't blame Square. Sony don't even have confidence in their own Platform. They would rather spend billions on Sony Pictures instead of investing in the future of PlayStation.

 

[ethomaz]

Not surprised by that drastic changes.

They had huge loses in HD Games this FY... they doubled the loses compared with last FY.

Plus they are trying to centralize the business units so now the very distinct Square and Enix (for these that doesn't know they are the same company but works separately) won't exists anymore.

Edit - This is where they are bleeding:... probably big titles didn't reached sales milestone to cover the costs so the loses.

 

[Entropi]

I don't blame them after FFVII Rebirth. PlayStation fans aren’t into FF anymore, I guess.

 

[Eternal_Wings]

I don't blame them after FFVII Rebirth. PlayStation fans aren’t into FF anymore, I guess.

So 2.5m - 3m copies are nothing?

 

[Entropi]

So 2.5m - 3m copies are nothing?

For a game of the scope and quality of FFVII Rebirth? Not enough. But don't take my word for it, look at square’s actions.

 

[Luffy123]

For a game of the scope and quality of FFVIIR? Not enough. But don't take my word for it, look at square’s actions.

You think PC users will buy this? They don’t even buy the Yakuza, Persona games

Those still sell best on PlayStation.

The issue is Square is spending big budget on ambitious properties whilst Capcom and Sega can pull relatively cheap small remakes, iterative sequels with minimal changes and ports to make easy Funds

Following in Capcom and Sega’s footsteps means lesser quality experiences and games

Sad

 

[Johnic]

Fucking hell, here we go again. A multiplatform publisher stays multiplatform and somehow, Sony's PC ports are connected to it. Fucking hell, what a shitshow this site became.

Maybe Square should have made an actual FF game, instead of whatever XVI wanted to be. They lost the old fanbase and didn't gain a new one.

FFVII R is great but it's hurt by that horrible first game that drove people away. Square needs to find a formula and stick with it. Worked great for the first 10 FF games.

But at least we can stop with the rumors that Sony;s acquiring them. It's just another partner Sony let go, just like Sega. Better use that money for another GaaS. We so need those.

@Luffy123

What Capcom lesser quality? They've been killing it recently. Also, Square went down that road a long time ago. FFVII remake wasn't exactly a great game.

 

[Ico]

FF16 and Rebirth were the reason I bought a ps5 instead of going to pc, i will probably get a ps6 just to keep having 4K since a playstation is somehow 2x cheaper than a top tier pc where i live

but man, the last half of this gen will be interesting to see, now that the switch 2 will take the xbox place as competitor since it will have a lot more of 3rd party support

a good chunk of their costumers were conditioned to doesnt really care if has less graphics and fps, and i know a lot of people that didnt go with nintendo bc they lacked 3rd party

 

[Luffy123]

Fucking hell, here we go again. A multiplatform publisher stays multiplatform and somehow, Sony's PC ports are connected to it. Fucking hell, what a shitshow this site became.

Maybe Square should have made an actual FF game, instead of whatever XVI wanted to be. They lost the old fanbase and didn't gain a new one.

FFVII R is great but it's hurt by that horrible first game that drove people away. Square needs to find a formula and stick with it. Worked great for the first 10 FF games.

But at least we can stop with the rumors that Sony;s acquiring them. It's just another partner Sony let go, just like Sega. Better use that money for another GaaS. We so need those.

16 was better for the franchise then Rebirth though

16 at least brought new younger audience to the game and by all accounts has sold better

Rebirth marketing was absolute dogshit and the wishy washy nature of it being a Remake or A New thing entirely did not appeal to customers and neither did shoving Aerith into our faces every 5 minutes

 

[VillaiN]

This thread needs ban cleaning. Every fkin thread a sony doom amd gloom. Some posters needs to get a life.

They said it to calm investors. Will they be multi fully? Maybe, maybe not.

Xbox s dead. If theres next xbox it ll be niche made by third party. By next 3,5 years doubt it ll be worth porting. Re u living underground? Whats happening with xbox? They re becoming 3p publisher fully.

Switch 2 ll be another potato for 399 or 450.
Rebirth s 150gbs. Fit that on catridge.

Pcs and handheld re different worlds. From power consuption to cpus. It wont have majority of big 3p.
Where re capcom big games on switch? Rockstar?

U do timed, exclusives deals in benining of gen. If sony s cutting cost to increase profits, they re doing by skipping paying huge ammounts for these deals.

If se doesnt get money from sony why d they make exclusives.

And i doubt SE knowledge to do these ports. They couldnt have finish 16 and rebirth without sony help. They still cant bring 16 to pc.
No1 knows what ll happen over next few years.

Some acting like ms bought SE and ps wont get their games. Instead they re getting ms stuff.

Get off your stupid fanboy horse and get a life.

 

[Luffy123]

Real issue is not Square doing this, they can they are a 3rd party publisher

It’s Sony’s PC initiative

 

[Johnic]

16 was better for the franchise then Rebirth though

16 at least brought new younger audience to the game and by all accounts has sold better

Rebirth marketing was absolute dogshit and the wishy washy nature of it being a Remake or A New thing entirely did not appeal to customers and neither did shoving Aerith into our faces every 5 minutes

The new audience wasn't there, as evident by the sales SE finds lacking. It tried to both have the cake and eat it too.

And I don't remember marketing for Rebirth, true. I think they biggest issue is that they rushed the remake and left a lot of people pissed. If it had been the same quality as the sequel, the entire series would have done much better. FFVIIR deserves so much more. An excellent game.

 

[Entropi]

You think PC users will buy this? They don’t even buy the Yakuza, Persona games

Those still sell best on PlayStation.

The issue is Square is spending big budget on ambitious properties whilst Capcom and Sega can pull relatively cheap small remakes, iterative sequels with minimal changes and ports to make easy Funds

Following in Capcom and Sega’s footsteps means lesser quality experiences and games

Sad

I’m not saying anything of the sort, but I can’t blame Square for trying something different after losing so much money. Honestly? I don’t think PC (lol at Xbox) will move the needle much. Releasing their big titles on Nintendo platforms might, though.

I understand your Sega comment, but quality-wise Capcom has been killing it in the past few years.

 

[Evilnemesis8]

So 2.5m - 3m copies are nothing?

No official numbers for Rebirth were provided in this report, nor an updated figure for other recent FF games.
But to answer, why is it always nothing and everything with fans? Why can't it be just mid and slightly underwhelming?

Square-Enix: We're not as successful as we've hoped for, even with the of release of two mainline FF titles within a FY.
This is in spite of our two titles were well received with a 88 OC(XVI) and 93 OC(Rebirth).

Random guy online: Just continue what you're doing dawg.

???

Those still sell best on PlayStation.

And? They're a third party publisher and ports are dirt cheap to make, they just require expertise to do.

 

[Systemshock2023]

Folks don't understand that FF lost it's mojo once graphics fidelity and production values left little room to imagination. That happened in FFX, where you could see how ridiculous character designs were and with voice acting adding insult to injury.

 

[J_Paganel]

The smell of Sega's "success" is in the air...

It was the same smell when Sega single-handedly destroyed its console business, and then years later hurt sales of its main game series, and destroyed its smaller IPs when it got into PC and GP.

 

[Zeno]

Expectations: People actually delivering arguments why and how Sony is doomed because of Square going multiplatform or Sony themselves releasing games on PC.

Reality: Children are furious that other children are able to play with their toys now.


Ghost of Tsushima sold almost 10 million copies on Playstation. How exactly is "Sony´s PC initiative" hurting the brand?

 

[Gamernyc78]

Square Enix announces new medium-term business plan – “Square Enix Reboots and Awakens: 3 Years of Foundation-Laying for Long-Term Growth”

Square Enix has announced the establishment of a new medium-term business plan covering the fiscal year ending March 31, 2025 through the fiscal year ending March 31, 2027, which it calls “Sq…

www.gematsu.com

Square Enix has announced the establishment of a new medium-term business plan covering the fiscal year ending March 31, 2025 through the fiscal year ending March 31, 2027, which it calls “Square Enix Reboots and Awakens: 3 Years of Foundation-Laying for Long-Term Growth.”

The goal of this business plan is to overcome the challenges faced in its previous medium-term business plan, including low profitability of its high-definition games sub-segment, a slowdown in the games for smart devices and PC browsers sub-segment, insufficient franchise-by-franchise portfolio management, and some gaps in Square Enix’s management infrastructure.

The four pillars of its new business plan are as follows:

Pillar	Initiative
(1) Enhance productivity by optimizing the development footprint in the Digital Entertainment (DE) segment.	Focus on development of titles delivering “Fun” that only the Group can create and build the development structure.
(2) Diversify earnings opportunities by strengthening customer contact points.	Shift to a multiplatform strategy. Building continuous customer contact points of our titles by stepping up digital sales. Create the interaction with customers by increasing sophistication of publishing function. Generating the opportunity of new revenue by offering IP across a range of entertainment experiences.
(3) Roll out initiatives to create additional foundational stability.	Rebuild overseas business divisions from the ground up. Introducing policies on organization and human resource allocation in Japan. Enhance business infrastructure by implementing PDCA cycle in a timely and appropriate manner.
(4) Strike a balance between shareholder return and growth investment when allocating capital.	Earmarks a maximum of ¥100 billion for total strategic investments over a three-year period (¥20 billion earmarked for share buybacks for the next one year).
By driving a new medium-term business plan, we will shift from quantity to quality and evolve to deliver a variety of contents that ensure “Fun” all over the world.

The full breakdown of each pillar is as follows:

(1) Enhance productivity by optimizing the development footprint in the Digital Entertainment (DE) segment
(2) Diversify earnings opportunities by strengthening customer contact points
(3) Roll out initiatives to create additional foundational stability
(4) Allocate capital giving consideration to the balance between growth investments and shareholder returns
(1) Enhance productivity by optimizing the development footprint in the Digital Entertainment (DE) segment

• • Shift from quantity to quality
    • The Group (Square Enix) will pursue a shift from quantity to quality as its medium- to long-term philosophy regarding the DE segment’s portfolio. To that end, it will first work to establish the optimal portfolio, striking a balance between a “product-out” approach that reflects the imaginations of its employees to the utmost, and a “market-in” approach that leverages customers’ voices and data to inform development efforts. It will strive for a regular launch cadence, focusing its development efforts and investments on titles with substantial potential to be loved by customers for years.
  • Focus on development of titles delivering “Fun” that only the Group can create
    • With the goal of developing titles that deliver unforgettable experiences to customers and ensure excitement, the Group intends to focus on the following points. First, mindful of the need to launch HD titles that help attract additional fans to the Group, the Group will regularly release AAA titles in its major franchises to maintain and build upon its fan base. In addition, the Group will strive to increase its success rate in SD games by launching a carefully curated selection of titles. It will additionally explore ways to leverage its rich library of IP.
  • Establish an internal development footprint that brings “Fun” that only the Group can create
    • The Group will retire its business unit-based organizational design and strive to establish an operationally integrated organization with the goal of revamping its internal title development footprint and bringing more capabilities in-house. In addition, while keeping balance between the creativity of its individual employees and the management centered on the organization, the Group will transition to a project management structure. To that end, the Group will redefine the mission for producers and other related employees and organize its internal supporting structure. Also, the Group will improve its development investment efficiency, by reviewing the overall management process of title development.

(2) Diversify earnings opportunities by strengthening customer contact points

• • Shift to a multiplatform strategy
    • For HD titles, the Group will aggressively pursue a multiplatform strategy that includes Nintendo platforms, PlayStation, Xbox, and PCs. Especially, in regards to major franchises and AAA titles including catalog titles, it will build an environment where more customers can enjoy our titles. In addition, it will also devise a platform strategy for SD titles that includes not only iOS and Android, but also the possibility of PC launches. Furthermore, the Group will strive to maximize the acquisition of new users when launching a title and that of recurring users after starting management of game operation.
  • Building continuous customer contact points of our titles by stepping up digital sales
    • The Group will strengthen user flow of digital sales of new titles at the time of launch regarding the initiatives of promotion. In addition, it will generate the opportunity of generating revenue in our rich catalog titles’ line-up, which leads to strengthen its earnings base by expanding sales of catalog titles. Moreover, the Group will engage in initiatives which focus on the acquisition of PC users.
  • Create the interaction with customers by increasing sophistication of publishing function
    • The Group will pursue integrated sales & marketing operations in Japan and make efficiency of publishing by consolidating the marketing functions that were previously spread across creative business units, expanding shared knowledge, and eliminating duplicate functions. Also, it creates a new reporting line in order to enhance collaboration between sales and marketing functions. It will also address the increasing sophistication of marketing by leveraging first-party data, including through the utilization of CRM solutions and data analytics, when developing an ad campaign for HD and SD titles.
  • Generating the opportunity of new revenue by offering IP across a range of entertainment experiences
    • The Group will pursue a cross-media strategy capable of approaching new markets. Specifically, it will expand area of license business by establishing a new department focusing on IP business development at global markets. In addition, it will build an organization which makes more active use of its IP by offering it across all media formats. The Group also hopes to generate synergies by integrating the organizations affiliated with its Merchandising segment.

(3) Roll out initiatives that create greater foundational stability

• • Rebuild overseas business divisions from the ground up
    • The Group has begun optimizing costs at its European and American offices via structural reforms. It will also promote intra-Group collaboration in Japan and abroad and strengthen the functions of its London development site. For example, the Group intends to work to strengthen the close collaboration between its divisions in Japan (creative studios and publishing) and to enable greater mobility of talent between them and the Group’s publishing functions overseas.
  • Revamp policies on human resource allocation & investment to balance both “creativity and productivity” in Japan
    • The Group will build its flat organization by increasing opportunities of promotion by selection in order to pursue a new talent at our company and streamlining the process of decision-making. Specifically, it will roll out a new human resources system in line with integrated management of development functions, building a new system for hiring, promotion, and appointment of management. Moreover, the Group will rebuild training system for new graduates and introduce internal education programs to enhance capabilities of junior and mid-level employees.
  • Enhance business infrastructure by implementing PDCA cycle in a timely and appropriate manner
    • The Group will pursue refining its management accounting system that enables greater visibility into business activities. In addition, the Group will not only make infrastructure enhancements that maximize the productivity of its employees under hybrid-working system, but also build its attractive office environment that helps unleash creativity for its development teams.

(4) Allocate capital giving consideration to the balance between growth investments and shareholder returns
The Group has formulated a capital allocation policy that gives consideration to the balance between growth investment and shareholder return, earmarking a maximum of ¥100 billion for total strategic investments (growth investments or shareholder returns) over a three-year period.
As regards growth investments, the Group will carefully select investment opportunities that contribute to the enhancement of corporate value and will utilize insights from its own businesses. It will explore the possibility of undertaking inorganic investments designed to expand its business domains and create greater stability.
Meanwhile, to reward its shareholders, the Group will issue regular dividends based on a basic policy of achieving a dividend payout ratio of 30%. In addition, in a change from its previous approach to capital allocation, the Group has set aside ¥20 billion for the funding of potential repurchases of its own shares to be executed flexibly between May 14, 2024 and May 13, 2025 based on consideration of factors including strategic investment opportunities, the Group’s financial position, and its share price. The firm has also revised the breakdown of its per-share dividends (interim dividend and year-end dividend).
Through these initiatives, the Group will strive to further enhance its corporate value.

Further information is available via Square Enix’s medium-term business plan presentation.

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