GS: That’s a pretty big jump.
SC: As you probably know, all of the major publishers are now seriously thinking of doing outsourcing, and many of them have dedicated new divisions to manage their outsourcing contracts as well as due diligence and recommendations to other internal studios. It's good for us. Most of them are public companies, they do very careful research, and they due diligence, especially in hiring foreign companies from China, Russia, and other non-U.S. companies. The security is a very, very high priority issue.
Many of them do a worldwide search. Sometimes they hire outsourcing consulting companies, to help them select the best ones. We're very happy to say that one of the largest U.S. companies shows us as one of the top five in the world in outsourcing.
GS: It seems like on the one hand, people would be very interested in working with Tose because of your long history and ability. On the other hand, there are other outsourcing companies in Thailand, China, and India that are cheaper, whereas most of Tose is in Japan, which could be perceived as being more expensive. Have you found that a difficulty?
KS: Yeah, that's a challenge for us. If they just see our price, they probably wouldn't choose us, but they usually value not only the price, but also the credibility, our track record, and that sort of thing. Lots of companies come to us.
GS: Do you have any development staff in the U.S. now?
KS: No, still just business partners.
CS: You program! (laughs)
KS: (laughing) A little bit!
GS: Last year, we were talking about next-gen assets. Has that been as fruitful as you have hoped, in terms of more people wanting to outsource next-gen art?
KS: Most companies we talk to who are interested in outsourcing art are also interested in outsourcing next-gen assets.
GS: Have you done any more work where you retain the IP since we last talked? I was wondering that after seeing your name on the box of a U.S. game.
GS: And Starfy still isn't going to be released overseas?
MA: We really want Starfy to be released here, but it's ultimately Nintendo's decision. I don't know why they don't push Starfy in the U.S., but it's very tough.
GS: Tose in Japan must be aware now that more people are interested in the company. Are they upset about that? Do they realize the value of people knowing the Tose name, or are they more concerned about receiving too much publicity?
KS: I'm pretty sure they are happy. Fortunately, they're in full production, so all the lines are very busy. They might not be able to take all the new business opportunities, but I'm pretty sure they're happy.
SC: Publicity by itself is not a bad thing at all. It's just how we are exposed, especially when it comes to mentioning particular projects or customers that we work for; then it becomes a little bit more of an issue. It's more of a marketing and strategy problem. And for investors - it's always what investors want to hear about - but we're not disclosing enough.
GS: Who founded Tose?
SC: Our current CEO Shigeru Saito did.
GS: Same CEO?
SC: Yes, he’s 49 years old.
GS: I thought the company was founded in 1979?
SC: It was, he was very young - 22. That makes three big Shigerus in the industry: him, me, and Shigeru Miyamoto. (laughs)
GS: That's impressive that he started at such a young age, and it's interesting that he would come up with such an idea back then. It's only now in the majority of the world that people are thinking about outsourcing. Quite a few years before his time.
GS: How does Tose differentiate its teams? I'm sure there are different teams who work on the triple-A titles and teams who work on the GBA titles. How is that determined?
MA: Of course we’re trying to make all the games triple-A We can't make team differentiation between titles. The team makeup comes from their expertise. If one of our team members has experience with lots of DS and GBA games, he'll probably keep doing those kinds of small games.
GS: I have heard a perception from some publishers that there are different levels of teams at Tose, and sometimes it can be difficult to know what team you're going to end up with.
SC: Who said that?! (laughs)
GS: I’d better not say! (laughs)
MA: We usually don't keep teams the same. We usually divide a team in two after a project, then assign the members to other teams. So if we have one triple-A team, and divide it in two, then we’ll have two triple-A teams.
GS: So that's a way of employee instruction as well? Do you put some junior people with people who just made a really great game, so that they can learn from them?
MA: Yes, that's what we do.
GS: What do you do when a project doesn't meet a publisher's expectations?
KS: Run away. (laughs) It rarely happens.
SC: Well, sometimes the direction of a game changes over the course of production. Some technical requirements change, like the engine can change during development. When that happens, we need to change everything until the publisher says "OK." That's our job, and to do all that while still being on time is a tough thing to do.
GS: Do you have your own engine and tools that you work with, or do you use whatever engine the publisher is pushing?
SC: Both. Like in China, since we last met we've developed one online game engine, and it's not yet published in the U.S. so maybe we can talk more about it next year. But we’re working on an online game for PC, and we hope to do more online game projects, because we have a proprietary online 3D engine, including the server-side aspect.
GS: I know that a lot of companies today are making a lot of money from licensing their own engines. Is licensing tools something that Tose has considered at any time?
SC: No. I originally come from a middleware business, and technically supporting licensees is a very serious business, and it takes a lot of people, a lot of time, and a lot of documentation. Our engines are just made to be used in-house only.