Microsoft scraps much awaited game

Daisuke Wakabayashi and Ben Berkowitz

TOKYO/LOS ANGELES: Microsoft Corp. said that it has scrapped plans to roll out an online video game that had been touted as a way to revive the fortunes of its Xbox game console in Japan.

"True Fantasy Live Online," a multi-player online role-playing game, was expected to be the Xbox's answer to Square Enix Co. Ltd.'s immensely popular online version of "Final Fantasy," only available for consoles on Sony Corp.'s PlayStation 2.

Microsoft officials prominently displayed the game at last year's Tokyo Game Show, saying it would be a way for the Xbox to win over Japanese gamers, known for their love of role-playing games.

But the game was noticeably absent from last month's E3 industry trade show in Los Angeles, and after three years of development that saw the game's launch target pushed back three times, Microsoft said it decided not to publish the game because it failed to live up to expectations.

"It was very, very clear to us that there was no way for the quality level we needed that it was going to make winter (for release)," said Peter Moore, corporate vice president for worldwide content and marketing in Microsoft's games unit. "We wish that we could just through sheer force of will bring this game to market. It just isn't happening."

Gaming executives have long acknowledged that the Japanese and American markets have different tastes -- Japan preferring fantasy and America leaning toward reality -- that can make it difficult for games to cross over the Pacific.

Japanese video game developer Level 5 created the game for Microsoft, which in March pushed back the title's launch date until winter from an earlier spring target.

"We started to be concerned with timetables and milestones in recent months," said Moore, who has called Japan his "pet project" and who previously ran the U.S. operations of Japanese game company Sega Corp. "The developer, who we have the greatest regard for ... agreed with us."

SLACK SALES IN JAPAN

According to game magazine publisher Enterbrain Inc., Microsoft had sold less than 500,000 Xbox consoles in Japan as of March 28 since its launch in February 2002.

By comparison, Sony has sold nearly 15 million PS2s in Japan since its launch in March 2000 and Nintendo Co. Ltd. has sold 3.2 million GameCube consoles since its September 2001 release.

Xbox's troubles in Japan started early on. Its launch trailed PlayStation 2 by nearly two years and GameCube by five months. Then, within a month of its launch, users complained that the machine was scratching DVDs.

Despite its problems in Japan, the Xbox has gained ground on PS2 in the United States and holds the number-two slot in the world's biggest video game market ahead of Nintendo's GameCube.

Moore said the company was slowly beginning to gain some ground in Japan and the Asian market with hit titles from the United States, which have traditionally fared poorly there but which Moore said were starting to gain greater acceptance.

One analyst said the problem of trying to make a successful online role-playing game was not unique to Microsoft, given that many companies have tried and failed to match the success of the one game that has had the best luck in that market, Sony's "EverQuest."

"Everybody's looking for 450,000 subscribers paying $12.99 a month, and nobody else has done it," said P.J. McNealy, an analyst at American Technology Research. "Japan is clearly a nice-to-have but not a need-to-have for Microsoft."

(C) Reuters