PSA Games / Consumer Electronics: Japan’s Video Games Industry – Japanese Bubble meets a Global Bull Market
Japan’s Video Games Industry – Japanese Bubble meets a Global Bull MarketTags: CyberAgent (4751 JP), Hakuhodo DY Holdings (2433 JP), TV Asahi (9409 JP), Sony (6758 JP), Capcom (9697 JP), Bandai Namco (7832 JP), KLab (3656 JP), Altplus (3672 JP), Kadokawa (9468 JP), Square Enix (9684 JP), , Universal Entertainment (6425), Nexon (3659 JP), Nintendo (7974), GREE (3632 JP), DeNA (2432 JP), Koei Tecmo (3635 JP), Sega Sammy (6460 JP), Konami (9766 JP), mixi (2121 JP), Colopl (3668 JP), Gumi (3903 JP), GungHo Online (3765 JP), Netflix (NFLX US), Spotify (SPOT US), Activision (ATVI US), Com2us (078340 KS), Paradise (034230 KS), Wynn (WYNN US), NetEase (NTES US), Amazon (AMZN US), Riot Games, Tencent (700 HK), Guerrilla Games, Disney (DIS US), Pixar, Red Bull, Microsoft (MSFT US), Niantic, Electronic Arts (EA US), Activision (ATVI US), People Can Fly (Epic Games)
Pelham Smithers and Thao Nguyen are publishing this in-depth report on the considerable and continuing opportunities being presented for Japan’s video games stocks; ranking 18 companies, and providing write-ups for each. In our view CyberAgent, Sony, Capcom and Bandai Namco are showing the most promise at this point.
In FY17 3Q, Japan’s video industry surpassed its FY09 3Q sales record to reach an all-time high. Our video game index has risen from a low of 624 in November 2012 to 2496 in March 2018, while our third-party software index (same index minus Nintendo and Sony) has risen from a low of 345 in February 2009 to 1367 in March 2018. The success, of course, is not unique to Japan. Globally, video games have been booming for over two decades. What was once a vicious short cycle market has developed into a seemingly stable high growth market; smoothed by globalisation, increasingly varied content, and helped by diminished reliance on industry-specific hardware. Japanese companies have learned to diversify both by market and by platform, with Square Enix probably now the most balanced video company in the world in terms of its mix of revenues from console, mobile and PC online gaming. Koei Tecmo and Bandai Namco are notable for their ability to develop overseas markets, making significant headway in North Asia’s tough markets. Nintendo looks poised to finally crack the China market. The US and EU are also seeing increased Japanese penetration; here, Capcom and Square Enix lead the way.
This report discusses the state of the global market in terms of console gaming, Sony’s PS Plus subscriptions, mobile gaming, and PC online. Japan itself is now allowing eSports, where opportunities abound.
Founded in 2009, Pelham Smithers Associates (PSA) provides market intelligence on Asian technology, focusing in particular on Japan. The industries covered by our team of specialists are: consumer electronics, telecomms, pharmaceuticals, internet, electronic parts and materials, automotive technology, retail and capital goods.
PSA produces both company and sector reports. The focus of PSA’s research is to identify winners and losers as new technologies impact the top and bottom lines of corporations. Critical to our research is the clear explanation of how these new technologies work and how they impact companies and industries.
The founding partners have worked closely together for twenty years and the team has more than doubled in size since 2012.
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