Namco Bandai Shifts Video Game Development to Japan After Flops

Namco Bandai Holdings Inc., creator of the “Tekken” and “Ridge Racer” video games, will shift the development of new titles back to Japan after half of its software was unprofitable last year.

“We found the quality and development speed of titles made for us by the overseas studios to be lacking,” President Shukuo Ishikawa said in an interview in Tokyo yesterday. “Foreign studios can still propose and develop games, but our Japanese staff will control the process more closely.”

The Tokyo-based company, which has studios in the U.S. and Europe, joins Capcom Co. in concentrating development of new titles domestically after several major overseas releases failed to reach the 1 million sales mark. Namco Bandai, which gets more than 70 percent of its revenue in Japan, wants to increase overseas sales to half of its total in the year ending March 31, 2016.

Last month, Namco Bandai said sales of titles for Sony Corp.’s PlayStation 3, Microsoft Corp.’s Xbox 360 and Nintendo Co.’s Wii consoles overseas will climb 56 percent to 5.9 million units in the year ending March 31. Domestic sales are expected to slump 14 percent to 3.3 million units.

Namco Bandai’s “Clash of the Titans” for PlayStation 3 and Xbox 360 sold 250,000 units as of Oct. 31, less than half the company’s target of 700,000.

Photographer: Robert Gilhooly/Bloomberg

Shukuo Ishikawa, president of Namco Bandai Holdings Inc., poses for a photograph during an interview at the company's headquarters in Tokyo. Close

Shukuo Ishikawa, president of Namco Bandai Holdings Inc., poses for a photograph during... Read More

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Photographer: Robert Gilhooly/Bloomberg

Shukuo Ishikawa, president of Namco Bandai Holdings Inc., poses for a photograph during an interview at the company's headquarters in Tokyo.

The game received a composite review score of 42 on the website Metacritic.com, compared with 91 for Microsoft’s multimillion-selling “Halo: Reach” and 94 for Activision Blizzard Inc.’s “Call of Duty Modern Warfare 2.”

Capcom said in May it will entrust development of new titles to its domestic teams and strengthen quality control of overseas projects after its “Bionic Commando” and “Dark Void” games struggled to win audiences. The Osaka-based company counts on Japan for more than 65 percent of its annual revenue.

To contact the reporters on this story: Pavel Alpeyev in Tokyo at palpeyev@bloomberg.net; Yoshinori Eki in Tokyo at yeki@bloomberg.net.

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net.

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