Square Enix Is Planning To Adopt A Multiplatform Strategy
May. 14, 2024Square Enix Is Planning To Adopt A Multiplatform Strategy
Square Enixwill make numerous changes to the company that affect everything from the types and quantity of games they produce to the platforms they are released on, as well as their marketing strategy, internal structure of development and publishing teams, the possibility of acquiring other companies, a focus on transmedia content, and the intention for their titles to be sold over longer periods.
The document, released a few weeks after they announced the cancellation or downsizing of multiple video games, aims to address the underperformance of their big-budget productions and the slowdown in revenue from their mobile and browser games, among other aspects.
The plan is divided into four pillars. The first one focuses on game development. Square Enix aims to achieve a stable release schedule, shifting from quantity to quality, by considering both developer concerns and customer feedback and data, all with the goal of releasing titles with the potential to be beloved by players for years.
They want to publish unforgettableAAA gamesfor PC and consoles that retain existing fans and attract new players, while also carefully selecting a variety of titles for mobile devices. To achieve this goal, they will reorganize how the development part of the company functions: instead of being organized into units like Creative Business Unit III led by Naoki Yoshida, responsible forFinal Fantasy XIV: A Realm Reborn and Final Fantasy XVI, it will be structured around projects, and developers will move between them.
In the section dedicated to revenue diversification, the transition to a multi-platform strategy stands out. While Square Enix has relied on temporary exclusivity deals in recent years, especially with PlayStation and Nintendo, they will now aggressively pursue publishing their AAA games on PC, Nintendo, PlayStation, and Xbox to create an environment where more customers can enjoy their titles.
They aim to maximize user acquisition at launch and, for service-based games, operate them in a way that attracts new players after release. Additionally, they plan to release mobile SD titles on PC as well.
Continuing with this pillar, Square Enix aims to adopt a business model that has been successful for other companies like Capcom and Nintendo: strengthening catalog sales, meaning sales of games that are several years old.
They also want to prioritize digital sales and will undertake initiatives focused on acquiring PC users. They have also created a new team focused on cross-media strategy, although they do not specify if it will focus on series, movies, or other media, to make their intellectual properties attractive in new global markets, expecting synergy with their merchandising department.
All these changes require transformations in how the company operates. Thus, they announce structural reforms, which have already begun in Europe and North America; Western offices will be more integrated with the Japanese company.
Additionally, they aim to strengthen the development studio the company has in London. Finally, they will reform their hiring and promotion system, offer educational programs to their employees, and create a hybrid work structure that combines remote work with office work.
They will invest $641 million, perhaps to buy studios In the section dedicated to investments and returns for shareholders, Square Enix announces that over the next three years, they will make strategic investments worth up to 100 billion yen, about $641 million at the current exchange rate, including non-organic investments, i.e., acquisitions of other companies to expand their business and create better stability.
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