At this year's Game Developers Conference, Daishirou Okada, the president and chief operating officer of Square Enix's American subsidiary and head of its mobile content operations gave a presentation titled "What's Next for Japan". In this presentation he shared his thoughts about the Japanese market for cellphone-based games.

Okada explained that the market for mobile games in Japan was worth 220 billion yen ($1.89 billion US). Following the acquisition of Taito, Square Enix currently had the second biggest market share (4.9%), trailing only Dwango (with a market share of 7%). According to Okada, many users play cellphone-based games in their homes, spending between 200 yen ($1.72 US) and 500 yen ($4.29 US) on monthly service charges. The majority of users who download games are hardcore gamers, while casual gamers seem to prefer games that come pre-installed on their cellphone over downloadable content. Thanks to higher connection speeds, heated competition between carriers (in particular between NTT DoCoMo and KDDI's au) and the entrance of Softbank into the cellphone market, the environment was generally a good one for game companies.

Just like during last year's presentation, Okada again highlighted the challenges posed by the North American market, where may users still continued to use older (that is, first or second) generation cellphones. Hence, more mass market appeal of cellphone-based games was crucial for success in the US. While Square Enix apparently aims to target both core and casual audiences in the US, the company first aims to appeal to a casual audience with games running on older, less powerful cellphones. This specifically means it will take some time before the company's most successful cellphone-based titles (Final Fantasy I and II, Dragon Quest I and II, Before Crisis: Final Fantasy VII and Code Age Brawls) will make their way to this side of the Pacific. As already stated in the past, Square Enix is thinking about setting up a community portal which Okada likened to a cellphone-based PlayOnline Mobile.

• GameWatch