Bandai Namco's European CEO, Arnaud Muller, has shed light on the new challenges facing game publishers when planning releases. Dive into Muller's insights and understand the implications for new IP launches.
There are Risks in Developing New IPs in a Crowded Market, Said Bandai Namco EU CEO
Rising Costs and Unpredictable Release Schedules Create Uncertainty
2024 has been a pivotal year for the video game industry, with Bandai Namco navigating through economic uncertainties and a packed release calendar. In a revealing interview, Arnaud Muller, the company's European CEO, discussed the challenges and opportunities in planning future game releases.
Despite Bandai Namco's robust financial performance in 2024, driven by hits like Elden Ring's expansion, Shadow of the Erdtree, and the eagerly awaited DRAGON BALL: Sparking! ZERO, Muller emphasized that the path forward is fraught with challenges. Although the industry has labeled 2024 as a "year of stabilization" post-layoffs and the "COVID years," it's the long-term hurdles in game development and release planning that worry Muller.
In his conversation with GameIndustry.biz, Muller explained that Bandai Namco adopts a "balanced risk approach" when assessing its game lineup. This approach takes into account investment levels, the capability to produce certain games, the potential of existing IPs, and the viability of new IPs in targeted market segments. Yet, Muller admits that the notion of "safe bets" is shifting.
"Are there safe bets today in the market? I believe yes," Muller remarked. "But… launching a new IP has become more and more difficult." The escalating development costs and timelines mean that potential overspending and delays must be considered from the start. If not, "you’re in for some bad surprises," Muller warned.
Adding to the complexity is the unpredictability of release schedules. With 2025's slate featuring titles like Monster Hunter Wilds, Avowed, Ghost of Yōtei, and possibly a Switch 2 launch, Muller is skeptical about the reliability of these release windows: "How many of these games will come on time?... We are no different to everybody else."
Muller believes that focusing on specific genres and established IPs, such as the upcoming Little Nightmares 3, offers some protection. "We believe that… there is an audience that is interested in our portfolio, that is loyal to some of our IP, and that will be interested in buying our games," he said.
However, even established franchises aren't immune to changing player preferences and market conditions. New IPs, with their high development costs and the saturated gaming market, face even greater commercial risks. "Little Nightmares 3… has a fanbase that hopefully will be interested in playing that game, irrespective of whether GTA comes in 2025 or not," Muller added.
Muller labeled 2024 as a "year of stabilization" for the industry, but he outlined three critical factors needed to "get the market back to significant growth": a favorable "macroeconomic environment," a robust platform and install base, and new markets with high growth potential like "Brazil and South America, India, and so on."
Regarding the impact of the upcoming Switch 2 on Bandai Namco's strategy, Muller stated, "we’re platform agnostic. Our games are mostly available on all platforms, and Switch has always been an important platform to us… Whenever a new console comes out from Nintendo, we’ll be ready to invest there."
Despite the challenges, Muller remains hopeful about the future. If the planned portfolio of games for 2025 comes to fruition, "then obviously, I don’t see how the market wouldn’t grow next year."
