The U.S offered the Redmond, Washington-based Microsoft a home field advantage and it was able to use popular sci-fi shooting game "Halo" and online service Xbox Live to power past Sony. As a result, "first-person shooter" essentially became shorthand for Microsoft's gaming machine.
In Europe, however, Microsoft struggled. Thanks to good games from Sony's European studios and a classy brand image, Sony has long had a stronghold in Europe, with more PS3s being sold there than the U.S. The Xbox could never really compete against Sony or Nintendo's consoles in Japan, either. And last month Microsoft did something that won't exactly help that position: It announced that it will not be attending this year's Tokyo Game Show.
Look around Japan: from Volkswagens to iPhones to PCs running Microsoft Windows, there are foreign products everywhere. And with the super strong yen, the number of foreign products continues to increase. So why hasn't the Xbox 360 succeeded here?
To put things into context, Sony has moved well over 6 million PS3s in Japan since they went on sale in fall 2006 (Nintendo has shipped over 12 million Wii consoles). In comparison, Microsoft has sold just 1.5 million Xbox 360 consoles in Japan.
There are several reasons for the discrepancy. One is that when the Xbox 360 launched, many Japanese gamers immediately wrote it off as something for foreigners. The reason for this was rooted in gaming history: PlayStation had a long tradition of popular Japanese role-playing games, while the original Xbox became synonymous with first-person shooters, a genre that was far more popular in the U.S. than in Japan.
Over time, Microsoft tried proving this stereotype wrong by releasing an array of Japan-only games, such as hostess game "Dream Club" and idol-simulator "The Idolmaster," on the Xbox 360. Since these games were aimed at Japanese hardcore otaku (geeks) and not mainstream players, they didn't have the mass appeal needed for the Xbox 360 to overcome its image issues with the general Japanese public.
Another reason for the discrepancy is that many early Xbox 360 units suffered hardware failures, causing consumers to worry about the machine's reliability. There was even a theory that the console's name, Xbox, was off-putting due to the negative meaning X (batsu) has in Japan — an interesting theory, but not one that necessarily holds water considering Toyota successfully sells a car here called Mark X.
The real problem for the Xbox 360 in Japan is lack of familiarity. When Japanese people want to buy a game machine, they immediately think of Sony or Nintendo — just like U.S folks may first think of Coca-Cola when they're thirsty. So, though hardcore gamers in Japan do tend to own (and enjoy) the Xbox 360, what Microsoft has always had trouble doing is taking the console beyond this hardcore crowd to a larger Japanese playing audience.
Enter the Tokyo Game Show — an opportunity for gaming companies to unveil new hardware and games to both hardcore gamers and regular folks, who can try out new games and game consoles. Traditionally, Microsoft shows up with a big booth that does not reflect the true size of its market share in Japan. However, each year, you can see more and more people lining up to play games at the Xbox booth.
A few years back, it seemed that the longer lines were because Microsoft and Sony were both showing some of the same games (multi-platform games that appear on both consoles), and the waiting time was often shorter at the Microsoft booth. But, as Western role-playing games and Western games in general became more popular in Japan, the Xbox 360 became a gathering point for those interested in checking out those titles.
Microsoft's appearance at the Tokyo Game Show has had a knock-on effect. It's definitely not the most cost-effective way for the company to spend money; however, if Microsoft is serious about Japanese gamers, it needs to attend. It needs to show it's in for the long haul. Since it won't this year, many Japanese gamers are wondering if their suspicions about Xbox were right.
In a recent interview with Japanese website Famitsu.com, Microsoft attempted to quell worries that it was giving up on Japan, noting that the company will be doing more local events in the country. For example, this past month, Microsoft held an Xbox 360 event in Akihabara, complete with demo stations for people to check out new games. This is better than nothing, obviously. The problem is that gamers who hang out in Akihabara already know about the Xbox 360. One of the strengths of Tokyo Game Show is that it attracts gamers from all over the greater Tokyo area, and it gives Microsoft an opportunity to get its console in the hands of gamers who may never pick up an Xbox 360 controller otherwise.
Things may not be as drastic as they seem though, as Microsoft isn't only sitting out the Tokyo Game Show. It's also skipping Gamescom, the biggest gaming show in Europe, probably because this is an off year, and Microsoft really doesn't have much to show until it announces its new home console. Yet, Microsoft's decision to sit out TGS will no doubt linger in the minds of Japanese gamers when the company finally launches its Xbox 360 successor, and they will probably once again wonder if this is another Microsoft console for foreigners.