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Video game industry hit by disaster in Japan


By Winda Benedetti

Japan is home to many of the biggest companies in the video game business — Nintendo, Sony, Capcom, Square-Enix, just to name a very few. And while many of the companies themselves managed to escape the earthquake and tsunami devastation largely unscathed, the disaster is expected to impact the game industry for months to come.

Jesse Divnich, a video game analyst for EEDAR, says he expects the biggest impact on the industry to be seen in game launch delays.

“The development process in the video game industry is not flexible, so any type of hitch at all whether internal or external will delay the release of a video game,” he said. “It’s hard to make up lost time. So short term we will see a lot of delays.”

Indeed, as we reported Monday, some game companies have already delayed titles due to the apocalyptic nature of the gameplay. But as this week has continued, publishers have announced even more launch delays in Japan.

Although Nintendo initially said it wasn’t going to postpone the release of any games, Japanese games blog Andriasang reports the game giant is now pushing back the launch of “Steel Diver” — a highly anticipated game for the new Nintendo 3DS game machine. Meanwhile, Konami is delaying the launch of its Nintendo DS game “Powerful Golf.”

Ubisoft also has announced it’s delaying the Japanese launch of downloadable content for “Assassin’s Creed: Brotherhood” called “The Da Vinci Disappearance.”

These delays certainly make sense. As the nation struggles to recover, gaming is hardly the first thing on anyone’s mind. But it seems delays are unlikely to stop there.

Energy conservation has become a priority issue for the country struggling to contain the damage done to its nuclear power plants. Because of that, companies have been powering down to help conserve energy and rolling blackouts have ground their work to a halt.

Famed game director Hideo Kojima (the man behind the “Metal Gear” series) posted that he’d beleaving work for power saving reasons.

Meanwhile, “Street Fighter IV” series producer Yoshinori Ono took to Twitter to update his followers on how this has impacted work there. “I could not go to R&D. Tokyo’s transportation was down. Part of knock out power in Tokyo. We’ll be not go back to work as usual for a while,” he said.

Michael Pachter, video game analyst for Wedbush Morgan Securities, told me it’s difficult to assess the extent of the impact on the gaming industry this early. He says a company like Nintendo, located several hundred miles away from the hardest hit areas, will likely not experience the kind of software development disruption other companies might.

But “It’s more difficult to assess with Sony, since they are in Tokyo, and we’re not getting a lot of news from there,” he says.

Pachter and Divnich both point out that the North American game market will not be nearly as impacted as the Asian game market.

“The U.S. market is not particularly dependent upon Japanese companies for software,” Pachter says. “But it is pretty dependent for hardware, so we could see a lingering impact if hardware supply is disrupted for more than a few weeks.”

Certainly the day-to-day business of gaming is taking a big hit in Japan. Square-Enix has shut down their “Final Fantasy XI” and “Final Fantasy XIV” servers temporarily to help conserve energy. The company has said the servers will be shut down for at least a week.

Meanwhile, Kotaku reports that the earthquake has caused difficulty for Sony’s PlayStation Network in Japan and is urging players to back up their data. The company’s PlayStation information call and repair centers also have been closed down for the time being.

Microsoft has also had to shut down its Xbox 360 repair center in Japan and is postponing the launch of some Xbox Live programs it had planned to launch in Japan this week.

“Obviously, if the threat of a nuclear plant meltdown materializes, things could get much worse,” Pachter said. “I just can’t guess what will happen there.” (That situation, in fact, grows more dire bythe moment.)

Despite the difficulties the industry faces, gaming companies both in Japan and around the world have been among the very first to offer financial aid to the country and its suffering citizens.

Nintendo, Sony and Microsoft have all made big donations. Meanwhile, Zynga — maker of “FarmVille” and “CityVille” — has partnered with Save the Children to raise money for the Japan Earthquake Tsunami Children Emergency Fund. Players can donate directly here or they can buy special in-game “FarmVille” and “YoVille” items, the proceeds for which will be donated to the relief efforts.

Capcom has cut the price of its “Street Fighter IV” game in Apple’s App Store to 99 cents and will be donating 100 percent of its purchase price to charity.

Their App Store plea reads: “People from all over the world, please unite with us to help people in the disaster-struck area.”

For a look at how game companies are helping with disaster relief in Japan and suggestions on ways you can help, follow this link.




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