Like many other publishers in Japan, Capcom have been attempting to make headway in the mobile games market. They’ve had some success with games like Smurfs Village, developed by the Western “Beeline” brand, but this past year, they haven’t seen as much success.
In terms of mobile content, outside of Monster Hunter Freedom Unite for iOS, the absence of any major games brought down sales for the Capcom and Beeline brands. In an effort to offset this, Capcom attempted to improve profitability by reducing the cost of sales and cutting back on selling, general and administrative expenses. However, this doesn’t change the fact that Capcom haven’t seen as many hit games in their mobile games business, and the company’s executives were questioned about this at a recent financial results briefing.
Why, Capcom were asked, is it that companies that specialize in creating console games have so much trouble increasing their share of the mobile games pie? In reply to this, a Capcom executive explained that they feel the mobile game market today is similar to the arcade market from 30 years ago, when a boom took place and attracted a great deal of competitors fighting for a share of arcade profits.
“We believe the mobile market of today is similar to the period about 30 years ago when the arcade game market first emerged,” a representative from Capcom said. “When a boom takes place, it attracts a large number of people. But this popularity does not last forever. As we saw in the game market that followed the arcade game boom, we believe that the best opportunities for Capcom will appear once smartphone performance has become even more advanced and there has been even more progress with the volume and quality of games.”
That’s just the first part of the quote. Here’s the second—and more intriguing—part:
“From a short-term standpoint, it may appear that Capcom has challenges in generating earnings in the mobile market. But we are acquiring knowledge about the operation of mobile content (combining skills in marketing and development of high-quality games). Our plan is to concentrate on developing content that can reliably produce earnings several years from now after advances in performance and game quality have taken place.”
That’s an interesting quote. Capcom have said a number of times in the past that they hope to leverage their own properties to make headway in the smartphone games market, and that should certainly become easier to do as smartphones and the games that you can create on them become more advanced. Right now, the vast majority of smartphone games are smaller, free-to-play experiences that provide immediate satisfaction. In a few years, though, we could very well reach the point where people are willing to pay more for high-quality smartphone titles that don’t necessarily rely on the free-to-play format.
Additionally, as a reminder, we did just see the release of Monster Hunter Freedom Unite on iOS devices, and that is certainly one of Capcom’s flagship games. That game costs $15—far more than your average smartphone game—so Capcom are certainly interested in finding out if people will pay more for quality. (As an aside, Square Enix are doing the same thing.) It should be very interesting to see what else the company can bring to the smartphone space in a few years.