Square Enix Part 2: How the West Was Lost?

What a difference a day makes.

My article regarding the success Square Enix has found by publishing titles from western developers was about to go live, when I read some perplexing news. It began with finding out that the president and representative director of Square Enix, Yoichi Wada, was stepping down from his position. Intrigued, I looked further and came to find out that Wada was stepping down due to poor sales of console games during the fiscal year. It was only a matter of time that the whole story became clear.

Tomb Raider has sold 3.4 million copies in 4 weeks and is considered a disappointment by Square Enix.

Yes, for Square Enix, selling 3.4 million copies of a game in 4 weeks is a disappointment. While I don’t pretend to know the entire projections Square Enix had for Tomb Raider and, by proxy, Crystal Dynamics (or that I would even understand them if I did) but I just can’t wrap my brain around the business model on display here.

Mere days away from the end of the fiscal year on March 31st,  it seems that Square Enix positioned Tomb Raider to be some sort of Hail Mary pass that would bring them into the black.  They specifically cited the combined 8.75 million units sold of sleeper “hit” Sleeping Dogs (no pun, I swear), Hitman: Absolution, and finally Tomb Raider as “weak”, Square Enix went on to claim that the company “expects to incur extraordinary loss in the settlement of the accounts for its fiscal year ending March 31, 2013.”

Square Enix Part 2: How The West Was Lost
Yep, looks like those games are abject failures!

Apparently success is measured by shareholders’ demands and extravagant financial predictions; not by the fact that a game managed to sell 3.4 million copies in less than month. This is a sad state of affairs when most developers would kill to see those kinds of numbers in the entire lifetime of their game, let alone in 4 weeks, and the publisher deems it as “weak” or as “failing to meet expectations.”

What does this mean for not only these franchises, but game development in general? As the machines we play games on, the displays we view games on, and the means by which we consume games become more elaborate and expensive they also become more expensive to create. In the case of Hitman: Absolution what kind of message does it send that 3.6 million units can no longer be seen as a success? Only a few games reach the dizzying heights of Call of Duty or Assassin’s Creed and it’s only a matter of time before the ground shifts beneath the behemoths and new kings take the throne. With sales expectations like those Square Enix have, what can anyone possibly hope to accomplish?

What should be a cause and time for celebration for Crystal Dynamics, IO Interactive and United Front can only be marred by the news of their success being tied so closely to words and phrases like “weak”, “failed to meet targets” and “extraordinary loss.”

In my ever so humble opinion, Square Enix had unrealistic expectations and laid those expectations at the feet of three games and their developers. What isn’t opinion, is that clearly my idea of success is far more conservative than that of Square Enix. It seems that if 3 titles selling 8.75 million copies collectively – one of which was a brand new IP in a relatively saturated genre, and another having only been out for 4 weeks – is considered a disappointment or failed to meet projections, that there is something severely wrong and maybe a restructuring is what is necessary.


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0 thoughts on “Square Enix Part 2: How the West Was Lost?

  1. Totally agree. I believe SE also mentioned that a game would need to sell >5M before it is a success. By this account both Hitman and TR will be successes over their lifetimes. And SD is a franchise that will likely keep growing. It is entirely SE’s fault that they raised expectations ludicrously high (especially considered how much lower other reboots have been selling) and now they pay the price.


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