GS: When I was at the Tokyo Game Show last year, they were giving out Xbox Live cards, and I thought it was a great idea to get people interested in the console - but they were only worth 100 points each. And you can't buy anything with it!

RN: Sometimes they give away a little card, and it randomly chooses an Xbox Live Arcade game for free.

GS: Your comment about Japanese developers working mainly on Nintendo consoles is interesting, because I wonder if it will make the next-gen knowledge base build up slower in Japan. Is that a concern for you, for the industry's future in Japan? Or do you think Nintendo will be enough to sustain it?

RN: It’s a big worry. The gaming industry is global, so as long as the global industry is healthy, it should be fine. But if you consider the Japanese economy with the Japanese industry only, it's a concern. I think Japan will position itself toward more classic-styled games. It’s similar to how Korea and China (are known for) PC online games, and high-end beautiful games are done by American or European publishers. There will be a little bit of a positioning difference, but overall, I think the global gaming industry will be healthy. I think Japan will be very, very behind in terms of technology, though.

GSG: Capcom and Square-Enix are even licensing the Unreal engine now, so that makes me think that other companies are seeing the value of Western gaming now.

RN: Yes, and Lost Odyssey is using Unreal Engine 3 as well.

GS: Since you also worked there, why do you think that EA hasn't been able to succeed in Japan? Do you think that cutting their Japanese development staff was a good idea?

RN: EA is the only Western company that's surviving in Japan, so you could maybe say that EA is successful in Japan. But it's very hard for Western companies to succeed in Japan. I think it's all about perception, really. In the early days of the games market, Japanese games were pretty interesting back then, while many games from overseas were seen as being bad. Now, you'll find a lot of interesting and fun games coming from North America and Europe, but because of that experience that we have from the early 1990s, people tend to stay away from Western games.

I think there's a market for Western games in Japan, so I tried hard to bring those in. But still, pro-sports games are not popular in Japan. Somehow, they prefer Konami's Winning Eleven soccer sim series over EA's FIFA series, and they prefer Japanese-developed baseball sims as well. We have our own feeling for baseball, and American baseball games are very different. It’s really hard.

There were a few games that were successful, but (it’s all relative) even with the GTA series– it was successful but GTA III sold 300,000, GTA Vice City was 500,000, and San Andreas was probably also 500,000. So that’s very, very successful as Western games in Japan, but the sales numbers are still small overall. Interestingly, those games that sell over 300,000 units in Japan are pretty much all European-made.

Rockstar's controversial Grand Theft Auto: San Andreas

GTA was from Europe, and Tomb Raider was quite successful as well. When Sony first started with the PS1, they brought a lot of games to Japan, and some of them were very successful, like Formula 1. Interestingly, the basketball title that Sony released in Japan then was very successful, but that was done in France. That was weird. Crash Bandicoot was successful, and that's American-made, but it was done by Mark Cerny, who used to work in Japan. So his experience was different.

GS: And also Naughty Dog has Hirokazu Yasuhara, the original level designer from Sonic Team. He does all the level design.

RN: By the way, EA is very successful in the PC market in Japan. The PC market is different. It's very hard for Western companies to be successful on consoles in Japan, but in the PC market, the majority of games are from the West. But the PC market in Japan is very small. Right now, if you combine the PC and online market, it’s pretty big.

Online games are popular. But in terms of proper PC games, Age of Empires is very popular, and first-person shooter games are also popular – but on PC. So there are users who appreciate American games, but it’s more toward PC.