Square Enix and its West Studios: “Train Wreck in Slow Motion”

Anyone who deals more intensively with games could not avoid Square Enix and its management decisions in recent years. What is particularly memorable is the focus on developing games in episodes, the planned and recently averted closure of IO Interactive (Hitman) and the sale of West studios such as Crystal Dynamics (Tomb Raider) to the Embracer Group in order to put the money into future markets how to invest in NFTs. And even with the core brands like Final Fantasy, many a long-time fan has question marks over their heads from time to time.

In an interview, someone who should know said he wasn’t very convinced of the management’s strategy in Japan. Stephane D’Astous, founder and boss of Eidos Montreal (Deus Ex), says that Square Enix Japan’s handling of its western studios was a “train wreck in slow motion”. He brings up the idea that Square Enix has slimmed down in order to possibly be taken over by Sony. In the current consolidation of the industry, that’s not so far-fetched, especially since core brands like Final Fantasy are still primarily associated with the Playstation.

The first Life is Strange was released by Square Enix, in episodes. The scene could be symbolic for East and West in the group.

Source: Dontnod Entertainment

They didn’t know how to sell their games

“This development was predictable,” D’Astous said of the demise of Square Enix’s western studios, and Eidos Montreal in particular. “I left because something was missing at headquarters. [Vor Square Enix] Eidos has a great tradition of development teams, but they don’t have a superior knowledge of how to sell their games. And that was very clear.” In 2009 followed – simplified – the takeover of Eidos by Square Enix. And with the sale of Eidos, Square Enix is ​​a much leaner company with lower costs, which in game development are mainly personnel costs. 300 million US dollars That flushed it in. The whole Eidos package had been paid for 120 million US dollars in 2009. That also included IO Interactive, which was taken over by management and investors for an undisclosed sum in 2017 after being successful in Japan was dissatisfied and did not want to finance a new project. One of the problems with Hitman from the point of view of the players was the release in episodes, which Square Enix preferred there, as well as with Life is Strange shown above. The concept did not work out for many retrospectively. The proceeds ran out The game developments were always a topic at Square Enix.Especially with the reboot of Tomb Raider 2013, there was also a lot of public discussion about whether on the one hand the expectations of the Japanese are wrong and on the other hand the budget for the marketing is not excessive.

At Thief, we did our best

“It was clear we had great brands lying dormant on the shelf. Legacy of Kain was discussed but wasn’t as strong as Deus Ex and Thief,” said D’Astous, reflecting on the legacy of Eidos Montreal. “At Thief we did our best and struggled, and that’s life in game development,” he continues. “You’re not always on the right path. We were close, but we just didn’t have the finishing touches.” D’Astous quit in 2013 and once again the financial performance of the studio was at stake – reportedly expecting $65 million in profits despite no releases planned for the year.

“We were amazed,” said D’Astous. “The pressure started to build […] I believe when people are in a crisis situation, […] one sees their behavior or their values. And I didn’t like what I saw. There was a real lack of leadership, courage and communication. And if you don’t have those basic things, no employee can do their job properly – especially when you run a studio.”

“I lost hope that Square Enix Japan would bring great things to Eidos. I lost faith in my headquarters in London. In their annual financial reports, the Japanese would always add a sentence or two that said, ‘We were from certain games disappointed. You did not live up to expectations.’ And they only did that for certain games that were developed outside of Japan.”

That does not make sense

D’Astous says Square Enix wasn’t sufficiently committed to its Eidos arm (or “West Studios”), which it acquired in 2009. There are said to be rumors that Sony was or is interested in a takeover, but only at Shinjuku Eastside Square in Tokyo. That doesn’t sound far-fetched when you look at the constellation and keep in mind how the industry is consolidating. “It was a train crash in slow motion, at least in my eyes,” was the conclusion. “It was predictable that the train would not go in the right direction.” D’Astous questions the low purchase price of 300 million US dollars: “That doesn’t make any sense.”

It remains to be seen whether the Sony takeover will come or not. Ubisoft is also currently considered a takeover candidate in certain circles, but it should be less interesting for Sony than the rest of Square Enix – with its portfolio it fits better into Sony’s strategy and Yasuhiro Fukushima will soon be 75.

Source: gamesindustry.biz