Do you think that's why people are turning to Nintendo more, because it's like the old style?

YT: First of all, part of what you said was true, because it takes money -- 10 or 20 million dollars for the first title on the PlayStation 3. I think Japanese publishers are treating 360 like a second or third format, or not thinking about it, except for bigger publishers. That learning curve is hurting the industry, I think.

At the same time, Nintendo's business model is great. Selling hardware at a low price point... it's very affordable, whereas 360 is more expensive, and the PlayStation 3 is initially a big loss. That's why I think Nintendo's gaining more share. It's like 70 or 80 percent of the business is Nintendo, now, in Japan.

I think, going forward, though, Japanese developers and publishers will make 360 and PlayStation 3 games. I'm talking about probably big ones -- probably the best top five or top six companies -- because more technology is available, and also they had a hard time developing new technologies, but they kind of came over the curve, and I think people are shifting development to a PC base now, so they can get PlayStation 3, 360, and PC together for their worldwide business. I'm waiting to see a lot of great games coming out from well-known publishers in Japan for worldwide business.

Capcom, for instance --

YT: That's a great company.

They're doing well with their next-gen development, but it seems like they're developing this stuff for the Western market.

YT: For America first.

Yeah, for America first. Like Lost Planet and Dead Rising -- those games.

YT: Especially Dead Rising. The first day I saw the game, I asked, "Who's the publisher?" and the producer said, "Capcom." "Who's the developer? It must be an American developer." The producer said, "No, this is Capcom internal, down in Osaka." I couldn't believe that! That day, I built a lot of respect for them, because that's something I'm pursuing too, from D3. We are providing games for a Western market.

So the way D3 has gone about it is to allow a U.S. branch to take over that. Your role is to find things like Dark Sector.

YT: Capcom has great development resources in Japan already. We don't. That's why we came here to open up an office, talk to developers, and sign up developers for projects, like Dark Sector.

I was talking to Ray Nakazato -- he's in charge of the FeelPlus studio.

YT: Yeah, he's working with [Hironobu] Sakaguchi-san, right?

Yes, that's right. On Lost Odyssey and on other things I think. Maybe Cry On.

YT: He came from EA to Microsoft...

He was at Capcom briefly.

YT: He was at Victor before, I think. I met him like three times.

He's a nice guy. We were talking about this issue of Japan falling behind a bit in terms of technology, and he was saying that he feels like in the future, large companies are going to be making one or two 360 games per year, and maybe 15 or 20 DS and Wii games, because that's where the money is in Japan. It seems like in a way the graphics are less important over there. It doesn't seem like as much of an issue. What do you think about that?

YT: Traditionally or currently, yes. People are not necessarily looking for the best graphics, so you can get away with PlayStation 2-quality on PlayStation 3, yes. But I really don't know what's going to happen. I'm very curious to see how Nintendo will keep on this success story. That probably brings the video game market to a whole different realm, I think, from gamer to family. Like the DS -- it sold very well to women in their 30s in Japan. That's not the market we are chasing here.

Not traditionally, anyway.

YT: Actually, sometimes I think Japan is probably more mature in terms of video games. If so, is that coming to America? I don't know yet. Right now I'm not really worried about it, because everything I see in America is core gamer-driven right now, especially after 360 came out. Again, it's a great format, to me. And hopefully PlayStation 3 will catch up. I'm sure they will. I think we're going to have a great market for a while.