New president looks back on “a year of tumult”
Kiryu claimed that “extended reality” (a fuzzy, catch-all word for VR and AR functionality being built into daily life) is on the rise in several industries besides gaming. “A case in point is the way the architecture sector, which previously had limited integration of XR in its business, began increasingly adopting these technologies because they enable the conversion of real-world architectural structures into data, a process also facilitated by the widespread use of commercial drones,” he argued.
“In the realm of digital entertainment”, meanwhile, “the experiential value of digital content itself increased dramatically” alongside the introduction of the latest AR and VR gadgets, and “the next step will be applying these technologies to new forms of content that fuse the real and virtual worlds.”
Talk of new applications for AR and VR aside, Kiryu went large on generative AI tools in his letter, arguing that they have “the potential not only to reshape what we create, but also to fundamentally change the processes by which we create, including programming”.
Square Enix intend “to be aggressive in applying AI and other cutting-edge technologies to both our content development and our publishing functions,” he commented. “In the short term, our goal will be to enhance our development productivity and achieve greater sophistication in our marketing efforts. In the longer term, we hope to leverage those technologies to create new forms of content for consumers, as we believe that technological innovation represents business opportunities.”
This echoes recent moves from Microsoft, who havelaunched a couple of generative tools for videogame quest and dialogue writing and aspects of NPC behaviour, and one question as ever is to what extent “generative tools” will be a pretext for reducing team sizes. Microsoft recentlyreached an agreement with ZeniMax Workers Unitedthat gave the union some say over how exactly “AI” is used in game development.
Developers and players remain pretty unconvinced as to what blockchain technology adds to games beyond banal,dead-enddigital landlord mechanics and outright scams, though the Epic Games Store made waves in December byexempting certain blockchain games from Adults-Only ratings and thus allowing them back on the Store.
Square Enix are also looking into creating “mechanisms that enable us to diversify our earnings sources” with a view to being able “to adapt flexibly to a changing business environment”, which suggests that Square Enix expect last year’s rough wider economic conditions to continue. Kiryu says that they’re working “to vet our existing pipeline of titles under development”, which I interpret as an acknowledgement that cancellations are possible, and are “optimizing our resource allocation across our entire development chain in order to accelerate an effort that was already underway to strengthen our internal development capabilities.” Kiryu hopes to “expand knowledge sharing with the goal of standardizing our processes and enhancing our efficiency.”
In terms of selling and publishing games, Square Enix want to do more to “promote the shift to digital”, and want teams in different regions to work together more effectively, “not only to maximize our sales of new titles, but also to deliver our rich back catalog to more customers and in turn to expand the fan base for our Group’s intellectual properties”. They also want devs and publishing teams to exchange advice and feedback more often, so as “to strike a balance between a product-oriented and a market-oriented approach”. All very dry, but potentially more decisive than any individual swanky new technology.
