Square over online gaming Nieuws | 27 augustus 2002 14:24 | Auteur: Arnold

we zullen nog moeten afwachten wat Square gaat doen op de Cube, maar we zullen niet snel een flop verwachten. Square heeft recent verteld hoe ze over online gaming denken. Hieronder kan je het lezen.

Japanese game software maker Square Co Ltd said today it aims to more than triple its online game users by March 2004 in a bid to expand a core revenue-earner and return to the black.

After the launch in May of "Final Fantasy XI," an online version of the popular role-playing game which has sold more than 38 million copies globally, the number of users paying a monthly fee of 1,280 yen ($10.71) has reached 120,000, Square President Yoichi Wada told Reuters in an interview.

"We hope to raise the number of users to 400,000 by the end of next (business) year, which would make the online game service another key profit generator besides our package game business."

To achieve that goal, Square will release a PC version of the game in autumn or winter and the advanced version of the game by the end of next March, while it also plans a North American launch next year, he said.

"We need around 200,000 users to break even in the online game business, which we said in May we aim to do in 2002/03."

Some analysts, however, see that goal as too optimistic.

"The online game will miss the company's sales target due to a slow start and a server glitch in May," said Eiji Maeda, senior analyst at Daiwa Institute of Research.

"We expect the service to post a one billion yen loss this year, but it will eventually attract 200,000-300,000 users, partially helped by an expansion of the broadband network."

Faced with a declining birth-rate in Japan, and therefore a likely fall in gaming population, game creators are looking to grow earnings through online user fees.

"Koei Co Ltd and Capcom Co Ltd are set to release online games, which may prompt more gamers to purchase the broadband unit for Sony's PlayStation 2," Maeda said.

To play the Square's online game at PlayStation 2, users need to install a broadband unit which includes a hard disk drive and network adapter. But the high cost of the unit at around 18,000 yen discourages some users to try the service, analysts say.


Wada said Squaresoft, which is owned 18.6 percent by Sony, aims to release one game title for Nintendo Co's GameCube home game console and two games for Nintendo's Game Boy Advance mobile game machine by the end of this business year to March.

The Tokyo-based company, which develops games mainly for Sony's PlayStation consoles, said this year it planned to develop a game for the GameCube next spring, but did not count sales from the new game into its earnings forecast for this year.

Wada said "The new GameCube game will have some kind of link with Game Boy Advance and we hope it will become a million-seller," adding that the game's sales would boost its earnings estimates.

In May, Square projected a return to the black this year with a group net profit of 4.20 billion yen on sales of 25 billion yen, after spilling red ink last year as it counted the cost of an ambitious but unsuccessful foray into movie-making.

Daiwa's Maeda said if Square keeps its promise to release the games for Nintendo consoles in 2002/03, it will offset slack domestic demand of its other games.

Wada said the firm plans to unveil its new product lineup at the Tokyo Game Show in mid-September and that it has no plan to make games for Microsoft Corp's Xbox for now.

Square's decision to once again produce the popular Final Fantasy game series for Nintendo's console marked an important step for the two companies, whose relations had soured in 1996 when Square abandoned Nintendo to develop the series exclusively for Sony's PlayStation platform.

Square's defection was seen as one of the primary factors for PlayStation's success in outclassing Nintendo's N64 consoles, and prompted Nintendo to refuse taking any titles from Square.

Given cheaper development costs to make games for Game Boy Advance than for PlayStations, analysts say a steady product flow to Nintendo's console would bolster Square's earnings.

Shares in Square closed up 0.17 percent at 1,750 yen on Monday, compared with a 2.03 percent rise in the key Nikkei average ($1=119.52 Yen)
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