The Next Big Theme Japan: September 2023

Video Games and Animation

Sony Announces New Portable Gaming Platform “PlayStation Portal”

By launching the PlayStation Portable in 2004, Sony Group brought its hugely popular PlayStation series into the mobile gaming market. In 2019, faced with the huge success of the Nintendo Switch, Sony made the decision to discontinue the PS Vita, which was the company’s mobile platform at the time. In August 2023, Sony officially announced the PlayStation Portal, in a move that was interpreted as another foray into the mobile gaming market. However, the PlayStation Portal is not a standalone gaming device and requires a PlayStation 5 connected to the internet at the user’s home. The device is expected to be available in November and will be priced at 29800 JPY (roughly 201 USD at the time of writing).¹

What the 2023 CESA Games White Paper Reveals About Japan’s Video Game Market

On July 31, the "2023 CESA Game White Paper" authored by the Computer Entertainment Supplier's Association (CESA for short) was released. According to the report, the size of the Japanese home video game market hit 377.4 billion JPY in 2022, among which 209.9 JPY can be attributed to hardware and 167.5 billion JPY to software.² According to the company's estimates, the size of the home video game hardware market was 202.8 billion JPY and the software market was 169.1 billion JPY in 2021.³ In 2022, a total of five titles hit the 1 million mark for units shipped, with Nintendo Switch games sweeping second through fourth place.⁴ In its financial report for the period between April and June (Q2 2023), Nintendo’s revenue was boosted significantly by the Super Mario Brothers movie and its blockbuster game Legend of Zelda: Tears of the Kingdom, recording 50% YoY growth.⁵ Nintendo's hardware sales unexpectedly rose 13.9% during the same period, even though the Nintendo Switch has been on the market for more than six years.⁶ Looking to the future, Nintendo expects Switch sales to decline. Investors and gamers alike are paying close attention to Nintendo’s plans for the next generation of consoles.

Semiconductors

Q2 2023: Japanese Semi Companies Post Losses, But Signs of Broader Recovery May Be Here

In August 2023, major Japanese semiconductor companies such as Tokyo Electron, DISCO, and Advantest reported declines in sales and profits, but this was to be expected given the correction in global semiconductor inventories. Against this backdrop, the SIA (Semiconductor Industry Association of America) industry report released on September 6 stands out. According to the report, the month-over-month growth trend for global semiconductor sales returned to positive territory for the March-July period, with July's figure increasing to 2.3%, up from the modest reading of 0.3% in March, suggesting that the bottom may be in sight.^7,8 Nevertheless, on a year-on-year basis, July sales fell 11.8%, serving as a reminder that the cycle has not come full circle just yet.⁹

Japanese Chipmaker Renesas Set to Acquire Sequances, Aims to Boost Presence in IoT

On August 7, Renesas announced that it plans to acquire Sequans, a French IoT integrated circuits and modules company, in the form of a tender offer. The tender offer commenced on September 11 and is expected to be complete by October 6.¹⁰ Upon completion of the transaction, Renesas will integrate Sequans' cellular connectivity products and IP into its core product offering, enabling immediate deployment in the wide area network (WAN) market. In addition, Renesas' existing Personal Area Network (PAN) and Local Area Network (LAN) product lines will also be enhanced. For context, a wide area network supports communication over a large geographical area, a personal area network provides short-range communication between individual devices, and a local area network is specialized for communication in a specific location, for example, within an office. Renesas sees IoT as one of its four growth areas, and for the full year 2022, the IoT business accounted for 28% of the company's revenue.¹¹ As IoT technology becomes more widespread, demand for semiconductors is expected to increase.

Bio- & Medtech

Shimadzu Makes Large Contribution to Research of Microplastics

Microplastics are tiny pieces of plastic less than 5 mm in size and are considered a contributor to marine and environmental pollution. They are found in many products such as cosmetics, detergents, and even food. On August 31, Shimadzu Corporation made a major contribution to microplastic research by launching the world's first automated microplastic pre-processing system, the MAP-100. The MAP-100 automates the pre-processing of microplastics, which used to take several days and was done by hand, greatly improving the efficiency of research. The company plans to sell 20 units of the MAP-100 a year at a price of 2 million yen.¹² Other Japanese companies are also contributing to microplastic identification technology: In September, Suzuki Motor Corporation, a manufacturer of automobiles, motorcycles, and outboard motors, announced that it had signed a joint agreement with Shizuoka University to conduct research into the identification of microplastics.¹³

Footnotes

1. Wired.jp, “Playstation Portalリモートプレーヤーで、ソニーはモバイルプラットフォームに“再挑戦”する”, as of Aug 24, 2023.

2. CESA,「2023CESAゲーム白書発刊！」 , as of July 31, 2023.

3. Ibid.

4. Ibid.

5. Nintendo, as of Sep 12, 2023.

6. Seeking Alpha, “Nintendo sees revenue surge, aided by Super Mario movie, Zelda sales,” as of Aug 3, 2023.

7. JETRO, “半導体市場の縮小に底打ちの兆し　生産の本格回復は2024年前半か（世界）” as of Aug 31, 2023.

8. Ibid.

9. Ibid.

10. Newsfile, “Renesas commences tender offer for all outstanding shares and ADSs of Sequans,” as of Sep 11, 2023.

11. Renesas, “August 2023: Renesas Electronics Company Overview,” as of Aug 2023.

12. Nikkei XTECH, “「世界初」のマイクロプラスチック自動前処理装置、島津製作所,” as of Sep 4, 2023.

13. Nikkei, “スズキ、静岡大とマイクロプラスチック判別技術の共同研究を開始,” as of Sep 11, 2023.

Notes

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