A failure to keep pace with changes to the international games market has hit the Japanese games industry hardest.
That's according to a new report on the Japanese industry in weekly trade magazine Famitsu, as translated by Polygon.
"This quarter featured tough earnings reports for companies overall," SMBC Nikko Securities senior analyst Eiji Maeda states. "One reason for that is the shrinking market for packaged software and the way that new, big-budget IP is failing to sell across the board.
Also, downloadable content sales are booming in the US and Europe and publishers are taking advantage of that for their bottom line, but Japanese makers have lagged behind, which is key."
"Like the previous one, this past year's reports show a game industry in a transition period, which hits the first parties the worst.”
Despite this the Japanese market grew 1.2 per cent in the year ending March 31st.