There's a new powerhouse in Japan -- one whose market cap has now passed Nintendo's. Developer GungHo Online is earning well over $3 million dollars a day from the unbelievably huge smartphone match-3 hit, Puzzle & Dragons, which has driven the company's market value to over $15 billion.

But that's not all there is to the GungHo story. In addition to the internal studio that produced Puzzle & Dragons, the company owns venerable developer Game Arts (the Grandia series), MMO developer Gravity (Ragnarok Online), Acquire (Way of the Samurai series), and more recently, Grasshopper Manufacture, home of iconoclastic developer Goichi "SUDA51" Suda, director of No More Heroes and the upcoming Killer is Dead.

Recently, Gamasutra was able to sit down with GungHo president Kazuki Morishita and Suda to talk about this new partnership, the runaway success of Puzzle & Dragons, and Morishita's plans for his new U.S. subsidiary, GungHo America.  

Why was GungHo interested in acquiring Grasshopper Manufacture, and why was GHM interested in being acquired by GungHo?

Goichi Suda: Initially, in Winter 2011, Grasshopper approached GungHo with this idea. Initially, there are two reasons why Grasshopper was interested. One of them is because GungHo's online strength and prowess. They've always done online games, which is something that Grasshopper wanted more input on. As well, I'd heard rumors and read interviews that Morishita-san had a big love for the game industry, and games in general.

So not just a president who cares about business, but one who cares about games.

GS: Exactly. Initially, we tried to meet in 2011, but because of schedule conflicts we couldn't meet. But the second time, I contacted him, and that was last October. By last November we were talking about my new game.

Kazuki Morishita: Initially when I heard this idea, I was ready to say no, because I really like Grasshopper's ideas and visual style and how independent they were. So I wanted them to keep doing what they were doing.

Also, I didn't want to overwhelm myself with the workload of managing, so I was originally going to say no. But we were talking about it, and we started drinking, and one thing led to another -- and more beers and sake -- and we started talking about what kind of games we wanted to make, and it just started making sense that we should be together.

Initially, I started a game company because I wanted to make good games. That's always going to be the same -- that's always going to be the principle that I go by. In terms of what GungHo is good at, pretty much we've been pretty inclined to do fantasy titles. Whether it's Ragnarok Online or our other titles, it's more fantasy-based or RPG-based.

Just seeing SUDA51's titles or ideas, I realized that these are ideas I would never come up with. So, I figured, put those two together and create a new original game, that's what I wanted to do -- create a game that was based off of Suda's world. I don't really do management, business-type stuff at work. A lot of people tell me to actually manage more, but I like to be on the creative, development side.

GS: I actually have a position within GungHo now where I can do the same thing -- focus on the creative side more. And I let the management people do admin stuff.

Goichi "SUDA51" Suda

Are you giving any input into other GungHo titles, or are you concentrating on only Grasshopper stuff from now on?

GS: Right now it's only Grasshopper.

KM: So as GungHo, we already have studios like Game Arts and GungHo, which we've sort of merged together, and which are working on the same kinds of titles. But I already have about 13 titles that I'm working on, on the development phase. As I mentioned earlier, I don't want to overwhelm myself with the additional work. So in terms of Grasshopper titles, I know that Suda-san knows best what he wants to do, and I'm letting him do that. I just wanted to work together on titles, not just manage everything that Grasshopper does.

So in terms of Game Arts, I'm also president of Game Arts as well. [Morishita hands me a Game Arts business card, in addition to the GungHo card he proffered prior to the interview.] Everything that Game Arts and GungHo do, I manage that part.

Kazuki Morishita

So does GungHo just count as the management/publisher side of it, and the studios like Gravity and Game Arts operate as studios?

KM: Not just Game Arts and Gravity and others, but GungHo has its own studios, such as Puzzle & Dragons Studio.