Square Enix, one of Japan’s leading video games publishers, is hunting a partner in the US and Europe to help raise overseas sales to 50 per cent of overall revenues within three years.

Michihiro Sasaki, senior vice-president, told the Financial Times it was imperative that the games maker increase its share of the US gaming market, the world’s fastest-growing, to counterbalance stagnant demand in Japan.

“We need to seek co-operation with a US publisher – we need local content,” Mr Sasaki said at the Tokyo Game Show. “Our strength is in role-playing games and fantasy titles, so it is a bit difficult to appeal to the US market.”

Only 10 to 20 per cent of Square Enix’s revenues came from overseas markets, he said. “Within two to three years we want to make it half.”

Square Enix is known for its popular Final Fantasy and Dragon Quest franchises but Mr Sasaki said American audiences preferred action-type games.

The company is also trying to strengthen its presence in online games, where operating margins are often as high as 40 per cent compared with 20 to 30 per cent for traditional packaged media.

Square Enix, a third-party publisher, makes video games for Nintendo, Sony and Microsoft. It has had very strong links with Sony and produced many games exclusively for the Play*Station 2.

But Nintendo’s Wii and DS handheld games players have leapfrogged Sony’s console in global sales, and Square Enix is aggressively creating titles for the Kyoto-based company.

Mr Sasaki credited Nintendo with helping expand the $30bn global games industry by creating a new “casual gaming” audience of women, children and older people. Square Enix was a “little worried” about the lacklustre performance of Sony’s PlayStation 3 console, he said.

Source:Financial Times