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Japan is just a symptom of Xbox' problems

The focus on miserable Japanese sales figures is a distraction; Xbox has problems everywhere outside the Anglo-American markets

However tough your job is today, spare a thought for Sensui Takashi. His job is selling the Xbox in Japan, which upon all the evidence thus far is a task not dissimilar to being a refrigerator salesman in the Antarctic, or a spokesperson for veganism in a lion enclosure. In an otherwise almost entirely un-revealing interview with Famitsu this week (Famitsu interviews generally being PR-directed puff-pieces of the first order), one note of frustration managed to slip through from the otherwise mild-mannered man with the games industry's worst job. "It's not like we're happy with the current state of sales," he told the magazine. He went on to say that the Xbox team will continue to do its best in a number of vaguely-defined ways, but the glimmer of annoyance was there. Sensui isn't happy.

Who can blame him, though? Xbox One's launch in Japan has been so mind-bogglingly awful that the world's media has effectively written it off as a meaningless dud already. Back when the Xbox 360 was giving the PS3 a kicking in the rest of the world, its poor performance in Japan was an object of curiosity. Now that the Xbox One is already an underdog, giving it a further kicking on the basis of even an eye-wateringly bad performance in a hostile market just seems unkind. The media isn't that keen to put the boot into Microsoft (believe it or not), mindful that the company is likely to remain a force in the industry for a long time to come.

"The Xbox did not fail in Japan, is not continuing to fail in Japan, because people here don't want to buy a product from a foreign company"

To put Sensui's comments in some context, though, consider this; the Xbox One sold half as many units at launch as the Xbox 360 did. In subsequent weeks, sales collapsed further, to the point where it's now selling about half as many units as the PS3 and the Wii U week to week (the Wii U being currently back in the doldrums after a pretty strong summer). It has yet to break 30,000 units sold overall. PS4, despite a late launch and a very slow ramp-up of interesting software for the local market, will soon hit three quarters of a million units sold.

"So what?" is a reasonable reaction, to an extent. Japan hates the Xbox. The failures of the console and its management in this market date right back to the era prior to the launch of the original Xbox, when miscommunication and mismatched corporate culture left Japanese publishers and creators cool on the idea of working on the platform. Japan may still be one of the biggest game markets in the world, but it's fallen off Microsoft's radar for the most part; it's notable that it took almost a year for Xbox One to even appear in this market.

It's frustrating, though, to see some of the lazy excuses which commentators concoct for the failure of Xbox in this market. The most common of them is that "Japanese consumers won't buy a console made overseas", implying that some kind of peculiar product patriotism leads them to automatically despise American or European products that compete with those from Japanese firms.

This is utter nonsense, as anyone who witnessed the enormous queues and boundless enthusiasm for the launch of iPhone 6 in Japan a couple of weeks ago can testify. Apple's smartphones utterly dominate the market here, much to the detriment of local companies like Sony and Sharp; their laptops and tablets do extremely well too. In plenty of other consumer product categories, from luxury cars (BMW and Mercedes) through to coffee makers (DeLonghi) and personal care products (Philips), western companies do remarkably well. If anything, overseas products carry a certain cachet among Japanese consumers. The Xbox did not fail in Japan, is not continuing to fail in Japan, because people here don't want to buy a product from a foreign company. It is failing because of something intrinsic to the product in question - something that simply doesn't appeal to Japanese consumers.

What might that be? Industrial design is part of it; the original Xbox and the Xbox One are particularly huge and while Japanese homes do tend to be small, that's perhaps less a factor than the general preference for sleek, unobtrusive industrial design over chunky expressions of power. Perception is a big problem for Xbox One, too; gamers are entirely aware of the console's negative perception overseas, so it doesn't even have the cachet of being a hugely successful system overseas to build upon. Software, though, is a much bigger factor. Many Western commentators have pointed out that Microsoft did work hard to bring some big-name RPGs to the Xbox 360 - what more could they have done, I've been asked - but that's not enough to sustain a console.

A console purchase is an investment for a consumer; they buy new hardware on the basis of belief that it will continue to entertain them for years to come. A single big game (Blue Dragon, Lost Odyssey, whatever) can only sell a console if consumers believe that there's more on the way; these RPGs, in contrast, felt like one-off "events", aimed more at proving to American consumers that Xbox 360 could do Japanese games than at selling consoles to Japanese consumers. Besides, not all Japanese consumers actually play RPGs; it's worth noting that the eventual low-key success of the Xbox 360 here (it did sell almost 1.7 million units in the end) came not off the back of these big-name RPGs but from the steady drip-feed of shooters, visual novels and various other genres which emerged as the console's life ran on.

"Xbox has a cultural problem, a laser-focus on Anglo-American markets that has left the rest of the world cold"

Overall, though, it's hard to pinpoint a single reason for the truly staggering failure of Xbox One in Japan. You know why? Because looking for that reason is entirely the wrong question to ask.

It's the wrong question because Xbox doesn't just have a problem in Japan. Look back at the Xbox 360, Microsoft's huge success story - it ended the generation neck and neck with the PS3, a massive reversal of the PS2 era and a great result for Microsoft. Those are global figures, though; break it down to regional figures and an entirely different picture emerges. Microsoft dominated the United States; it did extremely well in the UK. In the rest of Europe, in Japan and in most other markets, it got destroyed by the PS3 - a pattern that's being repeated with the Xbox One, except this time it's not even selling well in the US and UK.

We talk about Japan because Japan is a big market and it releases weekly sales figures to the public, so there's strong visibility of what's happening here. That shouldn't blind us to the reality of what we're talking about. Xbox doesn't have a problem in Japan. Xbox has a problem in everywhere outside the Anglo-American markets, of which Japan is only a part. The question isn't "why don't Japanese consumers buy Xbox?" - it's "why don't consumers anywhere outside the US and UK buy Xbox?" Focusing the discussion on Japan obfuscates this reality, allowing the apologists to creep in with their weird, 1980s-style "Rising Sun" narratives about Japanese consumers refusing to buy US products.

Xbox has a cultural problem, a laser-focus on Anglo-American markets that has left the rest of the world cold. In the last generation, the Xbox 360's remarkable performance in the United States was enough of a fig leaf to cover over its miserable performance outside the Anglophone world. This time around, the fig leaf has been snatched away. Even if PS4 wasn't overshadowing the Xbox One in its home market, though, the rising importance of non-Anglophone markets means that the oddly parochial Xbox was going to face a rough time this generation.

This isn't about Japan, whose game market is largely internally self-sufficient and focused on handheld and mobile titles; it's not even about France or Germany, stable, wealthy markets but not big enough to make a huge dent to global figures. This is about the rising middle class of swathes of countries across the world - a generation of teenagers across South and East Asia, South America and Eastern Europe whose families, for the first time, are in the market for luxuries. If Xbox cannot break out past its stubbornly Anglo-American culture and find a more universal appeal, its troubles in the first year of this generation will look like a storm in a teacup compared to the tempest on the way.

Image credit: AFP/Toru Yamanaka

About the Author

Rob Fahey avatar

Rob Fahey

Contributing Editor

Rob Fahey is a former editor of GamesIndustry.biz who spent several years living in Japan and probably still has a mint condition Dreamcast Samba de Amigo set.

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