A few months on from the Square Enix acquisition of Eidos and the new company is heading into the Christmas period with some successes already - notably Batman: Arkham Asylum.
To find out how the integration was progressing, GamesIndustry.biz caught up with global president of Square Enix Yoichi Wada - in the first part of this exclusive interview he explains what's already been achieved, what is still to come, and he adds his thoughts to the debate on the importance of bringing new IP to market.
Q: What's your evaluation of the company's business performance since the acquisition of Eidos?
Yoichi Wada: Well, it's been 119 days since the integration, and the process has been very smooth. The organisational integration is almost fully complete.
Just last week we had a Town Hall meeting of all the employees here [in Wimbledon] so that I could congratulate them on the integration and their hard work going forward.
So, as an organisation we've completed integration and we want to work harder on the exchanges between the studios - in fact, this has already been happening.
Q: What do you mean when you say "exchanges" - is that culture or technology?
Yoichi Wada: For the exchanges between studios, I mean both things. When it comes to cultural exchanges I think it would be inappropriate for us to have just a single cultural entity. Through integration and exchanges we may come up with something totally different to what we had previously, where it can be new, but with something from the past remaining within ourselves.
Having a single cultural identity would be, I think, the wrong path to pursue.
This office here is now called Square Enix Europe, but we've intentionally left all the studio brands as Eidos, because we want the original culture to remain.
Q: You mention the new brand, Square Enix Europe - how much of an impact do you feel that's had so far? What sort of message does it send out to the market?
Yoichi Wada: We haven't really had an impact yet - I think that's something we'll have going forward.
Q: Although the company show reel is already showing a strong line-up when both publishers are combined.
Yoichi Wada: There have been various game trade shows in different markets, and by presenting the two brands they've been well received in the market. But we've yet to do that with a major game show, such as Tokyo Game Show or E3 - so as I said, that's something we'll be looking forward to.
Q: With the integration complete, what's been the impact on head count - and is that something you were trying to avoid where possible?
Yoichi Wada: There's an ongoing process of reshuffling people, but that's not something we do just because of integration. As an ongoing process that's taking place all across the organisation looking at all of our foot prints - Square Enix Tokyo, Taito and ex-Eidos offices, have seen about 10 per cent reduction of headcount globally.
Q: And in contrast, where do you see the main areas for expansion for the company - not just in terms of staff, but franchise line-up, genres, range?
Yoichi Wada: It's how we want to develop and nurture new IPs - we want to work on them very carefully and thoroughly, which doesn't necessarily mean just increasing the number of people. We won't blindly launch new IPs, but we'll take time with each one so that they can be successful.
Of course, being a games company, developing and manufacturing is where we can create value so we'll be focusing on that portion of our business.
As far as the overall industry is concerned I believe the online business is very promising, and with the two companies coming together we have the capability to access a bigger player base - both in terms of more genres, but also having a greater geographical presence.
This is what we want to aim for - a global online business is what we want to work on.
Q: Regarding new IP - different publishers have very different views of whether or not new IP is currently a priority for them. Do you agree that ignoring new IP might be fine in the short term, but in the medium-to-long term the industry risks turning consumers away if there aren't enough new experiences being delivered?
Yoichi Wada: As an entertainment company the business won't be viable if we don't continue to nurture new IPs - but we don't need to come up with something that's dramatically new for the existing franchises, because we already have fans for those. If we carefully evolve them, that should be sufficient.
In nurturing new IP, the exchange of culture and technology becomes very important. In the past both Eidos and Square Enix have made investments in new IPs, but sometimes it's proved to be quite challenging.
This is probably because we didn't do enough work before the actual production - our priority was to come up with new IPs, so we rushed ourselves and had too many projects coming along at the same time.
The lesson we learned is that we have to be very selective in that area.
Q: Post-combination, Square Enix certainly covers off a lot of genres and play styles - are there any areas which you feel you still have gaps that need to be filled?
Yoichi Wada: Looking at the titles we have in our portfolio, I think what we offer are games in which people can genuinely enjoy the game experience. When you watch a movie, you enjoy the movie experience, and I think we do something similar, bringing a game experience to our players.
As long as they're enjoying the games, the genre isn't so significant - be it action, adventure or RPG - as long as we have a compelling storyline and appealing characters... as long as the gamers enjoy the game experience, that's what we offer and what we'll continue to work on.
So it's not really different genres we're looking at, but by leveraging all the resources we have within the group I think that we can achieve our objectives.
For new things such as social games - I don't know if I should call this a genre or a new service - there's a communication between players which is interesting. It's something we're already trying to offer, and going forward we'd like to have a more solidified business place with these social games.
Q: Is social gaming something that's happening more in the West, would you say? It's arguable that in Japan games have been social for a long time...
Yoichi Wada: Social games are played so that people can socialise with each other, so in that sense it's going to be very geographically specific - we might want to release a new game in France, Germany, Japan, the US and Canada, but the design structure will be specifically catering to these different markets.
So we are a global company, but for social games I think they're deeply rooted to the different cultures and lifestyles of the people there, and you have to look at the local market.
But we do have an advantage being a global corporation, because we can share the network engines - but the surface designs will be specifically made for local markets.
Q: Is that something where some of the Eidos expertise can help in the Western markets?
Yoichi Wada: Yes, I believe so. Just to give you an example, we now have an office in Paris - but prior to the acquisition we only had a footprint in the UK. Of course, we were going to France and Germany on business trips, but if you have an office in Paris you can talk to people who grew up in France and discover things which never came up before from the business trips alone.
Yoichi Wada is global president of Square Enix. Part two will follow next week. Interview by Phil Elliott.