Gaming industry in dilemma after “gacha” ban

8 years ago by in Featured, Technology

The new regulations that banned the so-called “complete gacha” games from the portfolios of Japanese mobile operators are still having unclear effects. Some analysts say foreign rivals will take advantage of the situation, while others think Japanese firms are adapting and looking for new profitable market segments.

The so-called kompu gacha games, or ”computer gacha”, charge users around $3 to $4 to give them the right to turn around virtual cards. Japanese authorities decided on July 1 that this is an illegal gambling practice, because the content of the cards was unknown at the time of the initial purchase.

“The immediate impact was panic, as the ban marked the first time the social games industry was regulated by the Japanese government–which was very lenient with mobile games operators until that point,” said Tokyo-based analyst Serkan Toto, quoted by ZDNet. In his opinion, the two major gaming operators Gree and DeNA lost almost 50 percent of their market capitalization within a month, after the ban decision.

Gree commented that the company is looking for ways to sustain its growth from foreign markets and will open a new studio in Southeast Asia.

According to Nomura research company, the ban decision could help foreign players such as those from South Korea to improve their market share in Japan in the long term.

Serkan Toto thinks however that the Japanese gaming operators will find new types of gacha games, that are not covered by the ban, and the market will remain “as hard to penetrate for non-Japanese developers as ever.”