5 issues we’ve discovered about Japan’s video games trade, plus how GTA 6 influenced Valor Mortis’ $40 value level

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In This Edition,

• Japan’s video games trade

• Valor Mortis’ goes low on value

• Nex Playground scores $150 million

• Plus, information from Blizzard, Sega and Team17

Hello from Tokyo!

This week, The Game Business is in Japan for Tokyo Game Show.

And to kick issues off, our visitor this week is analyst Dr Serkan Toto, who offers us an in depth overview on the successes and challenges dealing with the Japanese video games market in 2026.

It’s not all about Japan, nevertheless. Our different visitor is Blake Rochkind, the top of mid-tier writer Lyrical Games, who joins us to debate (amongst different issues) the “agonizing” choice round pricing its promising new IP Valor Mortis, which launches subsequent month.

Plus, we now have all the massive information from the final seven days.

You can watch or hearken to the entire thing above. Or try our highlights under.

Enjoy!

Ahead of Tokyo Game Show, we invited Japanese video games analyst Dr Serkan Toto to come back on our Show and focus on all issues Japan.

The full chat is value a pay attention, as we dive into the impression of Chinese-made video games on the Japanese market, the dominance of Nintendo, the rise of PC, the Japanese recreation media and we additionally speak about Hideo Kojima’s partnership with Xbox.

But listed here are the 5 issues I felt was significantly noteworthy:

In distinction to the West, Japanese online game console companies are in a powerful place, with most of the firms actively hiring.

“If you look at the top eight – Sony and Nintendo, and then the six big software ones – apart from Square Enix and Sega, six out of the ten are either near their all-time highs or very near their all-time highs. The Japanese console game industry, not so much the mobile industry, is doing exceptionally well.”

China is having an outsized impression on Japan’s cell recreation dev scene, with Chinese-made smartphone titles dominating the charts.

“It has become one of these stereotypical red ocean markets for local mobile game makers,” stated Toto. “The addressable market is not really growing that quickly anymore. The Japanese mobile gaming providers that we have, and there’s a couple, are increasingly threatened, or you can say overtaken, by especially Chinese smartphone studios that have come here guns blazing. They take no prisoners. They not only generate downloads, but they also capture a lot of the revenue market share.”

Chinese video games giants Tencent and NetEase invested closely within the Japan video games scene, even funding impartial studios from well-known recreation makers like Hiroyuki Kobayashi (Resident Evil) and Toshihiro Nagoshi (Yakuza). But as shortly as they moved in, these organizations pulled the plug.

“It’s China speed, right? It’s not only when they go in, it’s also when they get out,” stated Toto.

He added: “But it didn’t ultimately shake the Japanese game industry. A lot of people are saying, ‘Well, we told you so’. These companies are foreigners. They don’t really understand the Japanese process of game making, and what really drives the creators here.”

Toto added that the video games that Tencent and NetEase invested in merely weren’t profitable.

Japan is huge on console and cell, whereas PC is a comparatively small a part of the market. However, that’s altering.

“As of last year, PC has captured about 12.5% of the entire market,” Toto shared. “And in 2019, that number was 5%. It’s not unbelievably exploding, but it’s pretty sizable. PC is now a respected game platform in Japan. Whereas before, even the big companies like Capcom and Sega looked at the PC as a bit of a gaijin gamer platform that is not really relevant in Japan. That tide has turned.

“One trigger was the pandemic. There was the non-availability of the PlayStation 5 during that time. So, if people wanted to play high-fidelity games, they either had to continue to use their PlayStation 4, or start using gaming PCs instead. Another reason is PUBG became really big several years ago in Japan, and the PC was the first platform that particular game was available on.

“And a lot of the Japanese game companies in recent years, such as Capcom, started seeing the potential of the PC platform. And now you have a lot more Japanese games on PC, which wasn’t the case in 2017 and 2018. That’s motivated local users.”

I requested Dr Serkan Toto about Nintendo’s dominant place in Japan, and whether or not anybody can probably problem it. And he famous that there can be no console enterprise with out Nintendo.

“Nintendo has had an iron grip on the Japanese console market since 2017 when the Switch 1 came out,” he stated.

“I would phrase it a little differently. I would say that if Nintendo produced another flop like the Wii U, and if the Switch wasn’t the super hit it turned out to be, the Japanese console market would have been completely eliminated. I think that even more people would have turned to smartphones, and maybe even PC. Nintendo not only completely dominates the console segment here in Japan with 70% market share for all gaming content, but they also saved it.”

Check out our full chat with Dr Serkan Toto in at this time’s The Game Business Show.

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Upcoming first-person Souls-like Valor Mortis will value $40, The Game Business can reveal.

The new IP is the primary title from writer Lyrical Games, and is developed by Ghostrunner dev One More Level. It’s performing properly in pre-release metrics, with practically 1,000,000 wishlists and producing robust buzz since its Gamescom 2025 reveal.

Nevertheless, the writer is making an attempt to navigate a busy launch schedule, with the looming shadow of GTA 6 inflicting huge titles to cluster collectively in September and October. Lyrical has already delayed Valor Mortis from September 24 to October 13 resulting from competitors from Control: Resonant and Silent Hill: Townfall, and this has influenced the pricing choice, too.

“This is something we’ve really agonized over,” stated Lyrical Games boss Blake Rochkind. “My biggest concern was that it would send the wrong message about the game. But this decision is made out of confidence.

“We find ourselves as one of the only new IPs launching in what is objectively the craziest fall in the history of this business. Not only do you have GTA looming large in November, now you have the Zelda remake, Control coming out in a couple of weeks, Silent Hill: Townfall, Phantom Blade Zero, Gears of War, Call of Duty… By virtue of the development schedule, the cards we’ve been dealt is that we are one of the only new IPs launching this fall.

“We are pretty confident in Valor Mortis. But ultimately, the worst thing we could do is not push our chips in and say, ‘We want this to be a game that you can pick up alongside these other great games.’

“A developer I spoke to recently had a lot of success with a game priced at $30, which would probably be $40 today. One thing they said that really stuck with me is: ‘We never regretted being an ‘and’ game. We never regretted pricing our game as something that you can pick up alongside other games.’ Going with this price point will help us be an ‘and’ game.”

Valor Mortis may also launch into Xbox Game Pass, however this had no impression on the pricing, insisted Rochkind.

“Game Pass has reached a maturity point in this business where there are ‘Game Pass gamers’ – people who play games on Game Pass and were unlikely to buy the game day and date anyway. We’re happy to be on Game Pass, and I’m not really concerned about cannibalization. For every game that is ‘cannibalized’ by Game Pass, another game gets amazing word-of-mouth because of it. Clair Obscur launched on Game Pass.”

Lyrical specialises in ‘mid-tier’ titles with budgets of round $10 million. And it’s on the lookout for video games that may provide distinctive twists in a confirmed space. Valor Mortis is within the common souls-like style, however mixes it up with a first-person perspective and Napoleonic setting.

“[Souls-like fatigue] is a concern, and that’s one of the reasons not to do just another Souls-like,” he stated. “The worst thing any publisher or developer could do is be safe. Candidly, the vast majority of the pitches we see are fairly safe. We’re looking for that combination of talent, risk, excitement, and innovation when we sign a game. What keeps me up the most at night is not finding enough games we believe can break through the noise.”

Nex Playground has secured $150 million in its newest Series E funding spherical.

The funding is designed to bolster its world growth and guarantee stronger stock over the Holiday. The camera-based console is presently obtainable within the US, Canada, UK and Ireland, with a German launch coming this 12 months, and Japan and Korea deliberate for 2027.

Speaking to The Game Business, Nex CEO David Lee stated: “We enter every international market with love and respect. That means investing in localization, local IP, local music, local developers and local teams. Most importantly, it means listening closely to local customers so we can keep making the product better at serving the needs of their families.”

Meanwhile, Nex has named former Niantic CFO Jeff Shouger as its CFO. He may also be part of the Nex Board, alongside recreation trade veteran Bing Gordon.

Nex’s enterprise mannequin is constructed round a online game subscription service, and the agency says that’s now approaching a million subscribers.

The Series E funding is co-led by Baillie Gifford and BAI Capital, with participation from NBA Investments, Logitech, the Raine Group and Medici Capital, along with a brand new credit score facility with JPMorgan.

• Sega has signed a cope with Netflix for films and TV reveals based mostly on Crazy Taxi, Stranger Than Heaven, and Sonic the Hedgehog. The first undertaking can be based mostly on Crazy Taxi, with Dan Gregor and Doug Mand (2025 Naked Gun) on scripting duties.

• Blizzard made a sequence of bulletins throughout Blizzcon. It introduced Diablo 5 for 2029, an open world StarCraft shooter for 2030, and a brand new World of Warcraft variant known as World of Warcraft Forever, which is able to run alongside Classic and the vanilla recreation, and is due November 4. The agency can be partnering with Netflix on a Diablo animated sequence.

• Team17 mum or dad Everplay reported half 12 months income of £66.9 million (six months ending June 30), an 8% drop over the 12 months earlier than. Profit is down 29% to £23.9 million. However, proprietor Everplay expects robust full-year outcomes, resulting from spectacular gross sales of Bulkhead’s Wardogs and Expression Games’ Hell Let Loose: Vietnam. Everplay has additionally elevated its stake in Bulkhead as Wardogs hits two million gross sales.

• Valve’s Steam Frame VR headsets will are available in two variants. The cheaper 256GB mannequin will value $1,059, whereas the 1TB mannequin is available in at $1,299.

• Roblox says that creators will quickly be capable of publish their video games on cell, PC, and console as standalone apps. It’s a part of the Roblox Everywhere initiative.

• Moss developer Polyarc Games will shut down after 12 years.

• The GTA 6 Extended Look on Netflix generated over 100,000 sign-ups to the service within the US, in line with Ampere.

• Nintendolife and Push Square writer Hookshot has launched Steam Hype, which is a brand new PC-focused media outlet. The UK-based firm additionally operates Pure Xbox and retro model Time Extension.

That’s it! We’ll be again subsequent week with extra huge interviews and evaluation. Until then, thanks for studying.