Originally published in Business Journal on 24 Feb 2013.
Little Busters. Total Eclipse. Love and Elections and Chocolate. Fate/Zero. These are the titles of some anime broadcast in 2012. Even if you’re not a fan of anime, you might have heard of them before.
These anime all have something in common: they were all based on bishoujo games. Bishoujo games refer to story-based PC games with moe characters. A major trait of bishoujo games is the existence of pornographic material within the story.
Anime based upon bishoujo games have increased since 2000. Some of the more famous adaptations include Kanon, Air, Kimi ga Nozomu Eien, School Days and ef. In particular, Kimi ga Nozomu Eien has had a wider impact upon popular culture: its plot, which has the protagonist being involved in an accident and losing his memories and subsequently getting himself embroiled in trouble between his former girlfriend and his current girlfriend, is so well-known that a Korean drama with a similar plot is accused of plagiarizing from Kimi ga Nozomu Eien. Urobochi Gen, the scriptwriter of the blockbuster anime Mahou Shoujo Madoka Magica, which won numerous cultural awards and is one of the biggest hits within the last 11 years, was once a bishoujo game writer. The studio he worked for, Nitro+, which also collaborated on Madoka, also produces bishoujo games.
In many senses, bishoujo games aren’t as foreign or strange as we may think. However, many games take place in schools, and characters are designed to look fairly young, which have set off allegations of child pornography In addition, other titles feature intense sexual violence, which have led to accusations of these games inspiring sexual crimes against women. As an industry harshly criticized by mainstream society, companies working in the bishoujo game space keep a low profile, shrouded in mystery.
The history of bishoujo games can be traced back to the late 90s, when computers became popular in private homes. The market grew steadily during the first half of the 2000s, with yearly sales reaching almost 30 billion yen ($321M). However, since the apogee of bishoujo games in the early 2000s, the market has shrunk continually. Even though there are more than 600 titles released every year, the market was worth only 22 billion yen ($200M) last year.
In order to understand the status of bishoujo games today, we are interviewing Sakai “nbkz” Nobukazu, the lead producer of the company minori, which produced the famous series ef.
Q: So first question: How much does it cost to make a bishoujo game?
A: If we’re looking to maintain some semblance of quality, we’re talking about 30 million yen or so.
Here’s an example: let’s say we hire a scenario writer, a director, one artist and two assistant artists and give them a 250,000 JPY monthly salary. This is the smallest staff you could possibly have. These five people are going to have to do all kinds of other things that aren’t listed in their official job description. Let’s say you give these people one year to finish a full-price bishoujo game (selling at 8,800 JPY (~$95) per copy). So you’ve got around 15 million yen for salaries. Next, you’ll need to outsource voice acting, music, programming and background art, which will cost about 4 million yen. SG&A (Sales, General & Administrative) will run you another 1.5 million yen. Overhead and taxes will be around 3.6 million yen. So at this point, you’ve got 24.1 million yen in costs. If you add other variable costs related to production (printing, packaging) and employee benefits, you’ll need around 30 million yen ($312k).
In actuality, it’s really tough to finish a game in a year with five people. If you hire more staff or raise the production quality, some titles can run into hundreds of millions of yen in costs. For example, two games that we’ve made, Supipara and ef both went over 100 million yen in terms of production costs.
Q: 100 million yen?! Where does all that money go?
A: The largest cost is CG production. Unlike anime, CG consists of still frames, so each frame must be incredibly high-quality. It’s difficult to clean up lines, color in multiple gradients and add effects. It’s a labor and time-intensive process, and it’s impossible to do without many staff members. The more CGs there are in a game, the more expensive it’ll be to make. In addition, since players will be looking at background art a lot, quality control is paramount.
Resolutions on computer screens have been going up lately. This has had a negative impact on our costs. In the past, games were produced at 800×600, but now we’re talking 1920×1080. To put it simply, we have to color in 4.3 times the space. Not only does it take more time to produce each CG, but we must also become more and more careful with our quality control. We also have to consider the specifications of our customers’ computers. It’s unlikely that all of our customers have the newest, most high-end PCs, so it’s hard for us to think about what kinds of OSes and systems we should support. Unlike console games, PC games can’t assume uniform specifications across all machines.
Q: minori releases around a game a year. Is the company able to survive at this production pace?
A: If we can release one game a year, we’ll be fine. Actually, it’s really hard to create more than one full-price game every year using one set of production staff. I’m sure other companies will agree with me on this point. Since every work is an original production, we have to write the script, design characters, draw background art and consider the worldview of each game we make. All of this takes a huge amount of time. It’s difficult to do all of this in a year. There are companies that create more than one game a year, but they’ve got multiple production staffs. Selling 10,000 copies of one game is totally different from selling 10,000 copies of multiple games.
Q: Your new game, Natsuzora no Perseus (released at the end of 2012) had quite a few special goods that came with the deluxe edition (a vocal CD, BGM DVD, booklet). Which generates more profits, the deluxe edition or the regular edition of the game?
A: The more goods we create for the deluxe edition, the more production costs rise, naturally. If we’re only talking about costs, it’s far more profitable to sell many copies of the regular edition. Unfortunately, bishoujo games have a really short shelf life. Most of our profits are realized in the first three days of sale: Friday, Saturday and Sunday. After that, we don’t see many more sales being made. That’s why we throw so much money into creating first-press deluxe editions. Whether or not we can make a profit on a title depends on those three days.
Q: In 2011 and 2012, you participated in the BGM Festival (Note: A music festival hosted by bamboo, the president of OVERDRIVE, which showcases music from bishoujo games). This is a completely new kind of music festival, and even NHK took interest in it. What was this event’s impact on your sales?
A: To be honest, there was no appreciable affect. Since it was a music festival, there were more people there who were interested in the music rather than in our games. That was inevitable. The theme songs to bishoujo games are great advertising platforms, but it’s not as if people will buy the game for the song. However, just getting our name out there might be positive for brand recognition, so perhaps we’ll see some gains in the long run. I thought it was a good event to get our industry out of its current deadlock.
Q: Now that there are more bishoujo games being made into anime, have you thought of getting rid of adult content and porting your games to the PS3?
A: Personally, I don’t think it’s worth it. There are big differences between the PC and the PS2 or PS3. I think players need to play bishoujo games while sitting in their chairs, staring at a monitor. If we’re making games for the same platform, we force ourselves to constantly innovate, to create new scenarios and draw new CGs.
Also, ports sell pretty badly. If you can sell 50% of your original revenue in a port, that’s a huge victory. Since you’ve already got most of the original data, production costs are lower, so that’s a huge benefit. Let’s say the original game cost 500 million yen to produce. The port will only cost 100 million yen. So, I suppose one could turn a profit even if a port doesn’t sell that well.
A sad situation: most employees make less than 3 million yen a year
Q: Since the advent of personal computing and the Internet in the late 90s, bishoujo games have been adapted into anime and become a familiar force in our lives. What does the actual market itself look like?
A: Sales are decreasing every year, and the market itself is shrinking. There’s around 200 companies, big and small, producing bishoujo games today, but this number is also shrinking. You spoke of the advent of personal computing. In 2000, during the industry’s best times, a game that sold 100,000 copies was considered a blockbuster. 30,000 copies sold meant a big hit, and games that sold 20,000 copies was a success. Now, if you can sell 10,000 copies, you’ve got a hit on your hands. That’s the state of the industry. 10,000 copies is about .01% of the adult population of Japan. Most games go unplayed and unheard of. I’m not sure how these numbers compare to viewership trends for anime in the same time period.
Q: Why do you think the market is shrinking?
A: It’s probably because media is becoming more and more diversified. We’ve got Youtube, Nico Nico Douga and all kinds of social media games these days. In addition, we’ve also go tthe PS3, the PSP, the 3DS and all other kinds of gaming platforms. Stand-alone single-player games are becoming less and less popular. There are plenty of games that people play online with other people, but bishoujo games are, for the most part, single player.
I also think that consumers demand expediency. Think about anime. There were plenty of 4 cour anime in the past, but now, most anime are one cour. Most one-cour anime feature around five hours of actual content. Compared to that, most bishoujo games are long. One title contains around 1 MB to 2 MBs of text, which translates to around 18-20 hours of playtime. If one skips the voices and simply reads, maybe one can shrink the reading time to half of that. In a society that seeks expediency and instant gratification, bishoujo games go against the times. It’s also harder for people to talk about long works. That’s why you see more people critiquing anime and movies, and not so many people critiquing video games.
Let’s say we try to create games that are shorter and cheaper. That’s also not an option for us. Making short, cheap titles creates a lot of stress for our staff. In order to get around this problem, manga and light novels have adopted the strategy of releasing works in serial format, as tankobon. While this would decrease our costs, there’s no way we can adopt this model of production.
Q: In recent years, Akihabara’s experienced a boom of activity. Otaku culture is becoming more and more mainstream. Has the bishoujo game industry seen any increase in activity because of that?
A: Nope. We were hoping for such a boom, but the demographic is completely different. Voice actresses have become idols, more anime are being created and light novels are selling. This is all true. But, otaku are becoming younger and younger. These younger otaku buy goods that are less than 1000 yen. They’ll buy manga and light novels, and if something they like gets animated, they’ll watch it for free on the TV or on the Internet. In comparison, bishoujo games are usually 8,800 yen, and we see games that are 9,800 yen these days as well. A first-press deluxe edition might be more than 10,000 yen. There’s no way younger people will ever buy them. These people are not our target demographic. They might be interested in bishoujo games, but they won’t buy them, which is what we care about.
Q: It’s been pretty bleak talk up to here. How much do people make in the industry on average?
A: On average, I’m thinking about 3 million yen($32k) a year. It’s rare to find people who make 4 million yen. 3 million yen means a monthly salary of 250,000 JPY (~$2,700) without bonuses. Only companies with good sales numbers can afford to pay their workers that much. Of course, if someone makes a blockbuster, everyone on the staff will get more money. If you’re a famous artist, you’ll have other sources of income, too.
In any case, this is an industry without much profit. It’s natural that our salaries are so low. If we produce a game for 300 million yen, we can wholesale them to stores at half price. That means we’ll break even if we sell around 6,819 copies of a full-price (8,800 JPY) game. However, we’re seeing sales numbers below 5,000 for most games. We can try to make up for unsold inventory by producing goods, but for a game that’s sold only a few thousand copies, goods can only make up a small fraction of the shortfall.
Since we’re in this situation, there are plenty of companies that go under. Even if you create a hit, every year for 10 years, you’ll still be in the red and eventually go under. We were seriously considering disbanding after Supipara.
Q: Did Supipara not sell well? It may have been all-ages, but I thought it was a pretty solid game that really reflected minori’s unique qualities…
A: We only sold half of what we had hoped for. Unfortunately, our gamble didn’t pay off. We tried to expand into a new market, but it’s a huge risk for us to take on since our bottom line is already so poor. Obviously there are risks involved when trying something new, but since Supipara, we’ve learned the importance of going back to basics. That’s why we made Natsuzora no Pegasus. We’ve seen a bit of a rally since then, but the fact that one game can make or break your company is the real problem. (Wry laughter.)
The Retreat into a Niche Market
Q: So you’ve said that the market is shrinking and businesses are going under. Where does the industry go from there?
A: I don’t think it’s just us that are going under, but all media-related businesses. The idea of a “professional” is being blurred. Look at Nico Nico Douga. I feel like that’s we’re all headed. In other words, commercial works are expensive, but amateurs can produce works almost as good as pros and people can enjoy them for virtually nothing. In actuality, the quality of production between commercial works and amateur works is shrinking as the world becomes more and more digitized.
There was a time when people thought that piracy was the real problem. I don’t think so. Freeloaders will freeload anywhere. If they can’t get something for free, they’ll look for something else. People who won’t pay won’t pay.
Q: Do you have any countermeasures against this situation?
A: We’ve got a customer base. They’re fans who are truly interested in our work. These are the people we want to target. I hate to say it, but the kind of people who buy multiple copies of the same game are the kind of people we’re looking at. The bishoujo market has been a niche market for a long time now, but this retreat is only accelerating. Look at what’s happened to the music industry, serving only a small portion of the privileged classes. Bishoujo games will face a similar fate. We’ll exist solely to supply entertainment for a very small slice of people. That’s why I think we should stop listening to public opinion at large and only listen to those who actually want to buy our games.
Shops that sell bishoujo games are dying out rapidly. In most smaller cities, these stores are completely gone. We should have been thinking about this problem, as an industry, since long ago. In order to survive our current crisis, I think we have to shift to almost a “patronage” model of business.
Q: So, where will minori go from here?
A: As the company’s president, I’ve been thinking about where we go from here. Do we have a future? Is there any point in continuing to do business? I’m scrutinizing this problem. I want to make something new, but should we go forwards with the condition that we’ll exit the industry if we don’t sell well? Should we try something completely new? Should we slash costs and create something on a lower budget? These are the kinds of scenarios facing us right now. Of course, as a game creator, I’ve got different views on this subject, but that’s for another interview.
To be honest, I’m always ready to step down from my CEO position. I mean, we’re not making any money. Laughs.