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Square Enix aims to grow internal development in 2023, despite selling Western studios

Japanese and Western publishing branches to operate hand-in-hand as company commits to "One Square Enix"

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Square Enix president Yosuke Matsuda has shared the firm's ambitions to bolster its "internal development capabilities" in 2023 and shed light on why this goal is not at odds with having sold Crystal Dynamics, Eidos-Montréal, and Square Enix Montréal.

In his new year's letter, Matsuda explained that selling the three studios to Embracer in May 2022 aligned with Square Enix's objective to "further concentrate [its] resources as the increasing sophistication and complexity of game development have made such endeavours more costly to pursue."

He added that this was part of a larger restructuring across the group, with Square due to "reconfigure" its portfolio of titles "for the medium to long term."

"To that end, we will accelerate our efforts to strengthen our internal development capabilities by further expanding our internal talent pool, while also more quickly concentrating our resources on the development of titles that are competitive globally," Matsuda wrote. "The remarkable growth in the scale of modern game development has made elevating the skill sets and focusing the efforts of our development teams more important than ever.

"Divesting studios and strengthening our internal development capabilities may on the surface appear to be moves that are at odds with one another. However, we must flexibly and constantly revisit our medium/long-term title portfolio and the development studios that create it in light of the environment in which we find ourselves."

Matsuda also said that, publishing wise, Square Enix is moving away from its "geography and function-based model" that sees its Japanese branch and its Western branch operate independently from each other.

"Instead, we are creating an end-to-end global publishing organisation based on the concept of 'One Square Enix'. We launched this new structure late last year with close cooperation between our two chief publishing officers (CPOs), a newly created role."

Matsuda also reiterated the company's commitment to the blockchain space, which he had already touched upon in last year's letter.

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Marie Dealessandri avatar
Marie Dealessandri: Marie joined in 2019 to head its Academy section. A journalist since 2012, she started in games in 2016. She can be found (rarely) tweeting @mariedeal, usually on a loop about Baldur’s Gate and the Dead Cells soundtrack. GI resident Moomins expert.
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