TOKYO -- Video game developers in Japan are searching for ways to drive the next stage of growth and play catch-up with foreign peers in an industry that is changing at light speed with the 5G wireless technology revolution.
On the first day of the Tokyo Game Show 2019 -- one of Asia's biggest video game exhibitions -- Thursday, a group of people stood around empty tables, intently looking at their phones. What was grabbing their attention at mobile carrier giant NTT Docomo's booth was a battle featuring 3D digital characters from Capcom's Street Fighter series, enhanced with augmented reality, or AR. Spectators could view the battle from different angles as they moved their phones.
"We plan on using this technology for broadcasting actual matches," said Yoshinori Ono, corporate officer at Capcom, which collaborated with Docomo on game-watching experience using 5G and AR.
Capcom is setting its sights on the esports market in Japan, hosting team tournaments for its Street Fighter franchise. The company plans to launch an esports league through a tie-up with regional businesses.
Konami Holdings is set to open a facility for hosting esports tournaments in downtown Tokyo. A building under construction, dubbed Konami Creative Center Ginza, will house a studio for holding and livestreaming tournaments and a store for gaming computers, the company announced at the exhibition Thursday. The center will also offer courses for training pro players, tournament planners and other personnel, and the company has already begun enrolling students.
Game companies in Japan, the world's third-largest market after the U.S. and China, used to enjoy business growth by simply supplying content to console manufacturers such as Sony and Nintendo. Those days are long gone, and today they need to create games for phones and other new devices, as well as build environments where users can enjoy esports and cloud gaming.
Japan has lagged behind other countries in esports, a fast-growing industry in overseas markets. With Fortnite and other foreign titles dominating tournament play, Japanese companies feel the pressure to create games fit for competitions. They also under pressure to catch up with foreign rivals, chiefly in the U.S., in hosting tournaments.
New platforms pose another challenge. This fall, Apple will launch its Apple Arcade subscription service offering more than 100 games, while Google will debut its own Stadia cloud gaming service. The global games market reached $138 billion in 2018 and is projected to grow further over the next several years, according to Dutch market research company Newzoo. Market segments are expected to undergo a drastic change as well.
Game developers are working to keep up with this trend. Konami showed off an exclusive, updated version of its Frogger classic game that will be available in Apple's new service at the iPhone maker's product launch this week, with Capcom also appearing at the event. Square Enix and Bandai Namco Entertainment will work with Google, getting their Marvel's Avengers and Dragon Ball Xenoverse 2, respectively, in the Stadia service.