Our interview with Tose last year was one of the first times the company was exposed to the West, which isn’t surprising considering their M.O. is still ‘stealth’ development in which the publisher takes the credit. Recently the company’s name has been featured on more box covers, especially in the West, with games like The Nightmare Before Christmas for GBA – or directly in the credits, as in Square-Enix’s Dragon Quest Heroes: Rocket Slime.
The company is still shrouded in relative mystery, but at GDC 2007, Gamasutra got its second chance for an exclusive interview with the company. Herein, we discussed the changing face of Tose and its business tactics, though the changes are slight, as well as increased exposure in the west, the benefits of next-gen for the company, and the company’s first-ever game, back when Tose’s founder was only 23.
Representing a large slice of Tose’s development, we spoke with Masa Agarida, vice president of Tose Software USA, Koichi Sawada, director of China Sales (also for Tose Software USA), and Tose Software Shanghai president and director Shigeru Chigusa.
Gamasutra: It's been one year since we last met, when you were trying to up your profile in the United States. How has that been going?
Masa Agarida: It's pretty good. We’ve added Koichi for helping our China business. He's doing very good, but I think you should ask him about it. Shigeru is actually handling Koichi's business. But he's doing very good, so we're doing well.
Koichi Sawada: We've been expanding our contacts in the United States the outsourcing side of business. We've been talking to lots and lots of companies, and we've started some outsourcing work with some publishers. We have lots of pending discussions going on.
MA: In addition to the outsourcing, we're currently working on a big DS title for a big company in the Bay Area.
GS: And has anything changed in terms of how Tose is presenting itself in the U.S., in terms of still being behind the scenes?
KS: We're trying to still stay behind the scenes, but your article was very helpful. You kept our policy straight, but we've had more exposure, and now lots of people recognize the name Tose. It's getting easier for us when we start conversations.
MA: The funny thing for me is when 1UP.com mentioned our name on their website, lots of people contacted me through e-mail. I asked them how they got to know us, and they said 1UP.com and Gamasutra. That is good for us, but I told this to our Japan side, and they said, "You don't have to mention our name on your websites. We ask you to keep behind the scenes."
GS: So is it sort of a different policy in Japan and China, or are you all trying to follow the same company line?
KS: It's the same, trying to stay behind the scenes. But you know, we have to make potential customers, developers, and publishers aware of the name Tose. It's hard, because we can't mention our portfolios and stuff, but your article was actually very helpful. So whenever we make presentations, we mention the article at Gamasutra and tell our audience to read it. They have a very good understanding of the company from that.
GS: I've seen your name a lot more on some U.S. products, and that's pretty different from how things were in Japan previously. Is that part of getting your name out a little more?
KS: Really? Like with Avatar, the THQ title?
GS: I've seen your name credited to The Nightmare Before Christmas, with Buena Vista for GBA. The name's right there on the back.
KS: Oh, I didn't know that.
MA: Actually, I have tried to expose us more in the U.S. than in Japan, but right now, everybody's getting to know us more than before. Right now I'm thinking of going back behind the scenes again.
GS: So you may start taking your name off of boxes again?
GS: When you did have the name on the box, were you also including employee credits in a staff roll?
MA: It depends on the project. If some company asks us to mention all the names, we will.
GS: How has the breakdown of outsourcing gone since last year? Previously it was something like 70% Japan, 20% or so to China, and then everything else went to the U.S. Has this changed?
Shigeru Chigusa: It's changed a bit for China, at least. I think we have more North American or Western customers as well, maybe a five to ten percent increase.
GS: That’s a pretty big jump.
SC: As you probably know, all of the major publishers are now seriously thinking of doing outsourcing, and many of them have dedicated new divisions to manage their outsourcing contracts as well as due diligence and recommendations to other internal studios. It's good for us. Most of them are public companies, they do very careful research, and they due diligence, especially in hiring foreign companies from China, Russia, and other non-U.S. companies. The security is a very, very high priority issue.
Many of them do a worldwide search. Sometimes they hire outsourcing consulting companies, to help them select the best ones. We're very happy to say that one of the largest U.S. companies shows us as one of the top five in the world in outsourcing.
GS: It seems like on the one hand, people would be very interested in working with Tose because of your long history and ability. On the other hand, there are other outsourcing companies in Thailand, China, and India that are cheaper, whereas most of Tose is in Japan, which could be perceived as being more expensive. Have you found that a difficulty?
KS: Yeah, that's a challenge for us. If they just see our price, they probably wouldn't choose us, but they usually value not only the price, but also the credibility, our track record, and that sort of thing. Lots of companies come to us.
GS: Do you have any development staff in the U.S. now?
KS: No, still just business partners.
CS: You program! (laughs)
KS: (laughing) A little bit!
GS: Last year, we were talking about next-gen assets. Has that been as fruitful as you have hoped, in terms of more people wanting to outsource next-gen art?
KS: Most companies we talk to who are interested in outsourcing art are also interested in outsourcing next-gen assets.
GS: Have you done any more work where you retain the IP since we last talked? I was wondering that after seeing your name on the box of a U.S. game.
GS: And Starfy still isn't going to be released overseas?
MA: We really want Starfy to be released here, but it's ultimately Nintendo's decision. I don't know why they don't push Starfy in the U.S., but it's very tough.
GS: Tose in Japan must be aware now that more people are interested in the company. Are they upset about that? Do they realize the value of people knowing the Tose name, or are they more concerned about receiving too much publicity?
KS: I'm pretty sure they are happy. Fortunately, they're in full production, so all the lines are very busy. They might not be able to take all the new business opportunities, but I'm pretty sure they're happy.
SC: Publicity by itself is not a bad thing at all. It's just how we are exposed, especially when it comes to mentioning particular projects or customers that we work for; then it becomes a little bit more of an issue. It's more of a marketing and strategy problem. And for investors - it's always what investors want to hear about - but we're not disclosing enough.
GS: Who founded Tose?
SC: Our current CEO Shigeru Saito did.
GS: Same CEO?
SC: Yes, he’s 49 years old.
GS: I thought the company was founded in 1979?
SC: It was, he was very young - 22. That makes three big Shigerus in the industry: him, me, and Shigeru Miyamoto. (laughs)
GS: That's impressive that he started at such a young age, and it's interesting that he would come up with such an idea back then. It's only now in the majority of the world that people are thinking about outsourcing. Quite a few years before his time.
GS: How does Tose differentiate its teams? I'm sure there are different teams who work on the triple-A titles and teams who work on the GBA titles. How is that determined?
MA: Of course we’re trying to make all the games triple-A We can't make team differentiation between titles. The team makeup comes from their expertise. If one of our team members has experience with lots of DS and GBA games, he'll probably keep doing those kinds of small games.
GS: I have heard a perception from some publishers that there are different levels of teams at Tose, and sometimes it can be difficult to know what team you're going to end up with.
SC: Who said that?! (laughs)
GS: I’d better not say! (laughs)
MA: We usually don't keep teams the same. We usually divide a team in two after a project, then assign the members to other teams. So if we have one triple-A team, and divide it in two, then we’ll have two triple-A teams.
GS: So that's a way of employee instruction as well? Do you put some junior people with people who just made a really great game, so that they can learn from them?
MA: Yes, that's what we do.
GS: What do you do when a project doesn't meet a publisher's expectations?
KS: Run away. (laughs) It rarely happens.
SC: Well, sometimes the direction of a game changes over the course of production. Some technical requirements change, like the engine can change during development. When that happens, we need to change everything until the publisher says "OK." That's our job, and to do all that while still being on time is a tough thing to do.
GS: Do you have your own engine and tools that you work with, or do you use whatever engine the publisher is pushing?
SC: Both. Like in China, since we last met we've developed one online game engine, and it's not yet published in the U.S. so maybe we can talk more about it next year. But we’re working on an online game for PC, and we hope to do more online game projects, because we have a proprietary online 3D engine, including the server-side aspect.
GS: I know that a lot of companies today are making a lot of money from licensing their own engines. Is licensing tools something that Tose has considered at any time?
SC: No. I originally come from a middleware business, and technically supporting licensees is a very serious business, and it takes a lot of people, a lot of time, and a lot of documentation. Our engines are just made to be used in-house only.
GS: Do you find that outsourcing with U.S. publishers has been different from Japanese publishers? Has it been a different experience?
KS: I don't know. We're not involved in the Japanese side of things.
MA: Personally I don't think that it's a big difference between them, but the teams always said that working with U.S. publishers was a bit more difficult, because they already have established connections with Japanese publishers. They don't have to have any contact with the Japanese publishers; they just do the game. Working with the U.S. publishers is a lot more work, since they have to tell the publisher what they are doing a lot of the time.
GS: So you have to go through a lot more checks at different stages and things?
SC: As a contrary from the Chinese side, sometimes working for American companies is easier than working for Japanese companies. That’s because sometimes we do art only, or very specific jobs, details, so the details and specifications of the work that are much more clearly defined and well-prepared before they give instructions to us. We just have to take the instructions and references, and execute them right away.
On the other hand, Japanese customers in a lot of cases leave slightly more space for us to be creative. Being creative is fun and is very exciting, but at the same time, the directional differences within that margin of creativity is difficult. Sometimes you hit that target on the first try, and sometimes you don't.
The cultural differences are a factor as well. Chinese people tend to think more similarly to American people than Japanese people, so the way people think may be a little more linear like Western thinking. The Japanese way of thinking is more non-linear, and more organic, so to speak. Depending on the kind of work we're doing, working for American companies is sometimes easier.
GS: Yeah, a lot of smaller American companies seem like they're getting interested in outsourcing partial work, like Wideload Games and Junction Point. They're seeing about how to outsource just bits of things, and more companies seem to be building internal structures that can support that. Like they’ll build the first instance of an asset, and then ask an outsourcing company to create more assets like that one. Have you seen that expanding?
KS: Yeah. Some companies only have a core internal team of producers, directors, artists to come up with designs, and engineers. Lots of companies keep engineers internal. They don't outsource a lot of engineers, though some companies do. Lots of small companies outsource to companies like us for assets. I think that's a very wise way of doing things.
It looks very simple, but it's not that simple. They have to have thorough planning, very specific directions, and stuff like that. That's the toughest part of developing a game, I think. But I've seen more and more companies like that nowadays.
GS: Yeah, you have to have really strong project management and directorial structure.
KS: That's right.
GS: Are you at all worried that places like India or Thailand will end up taking more and more of the outsourcing business from you?
SC: Yes! (laughs) Well, China and India are always compared, and always competing. India has very strong experience in high-end CG movies and television series, but not so much so on the games side. They're used to using millions and trillions of polygons, and spend several hours per frame as part of their production style. We are constantly limited by polygon budgets. The tools are similar, and they are computer generated images, but the thought behind it is very different in terms of approach.
Eventually though, they are going to cross. I think it's already starting to happen. The advantage that they have is that they speak English in India. We have a certain advantage in the time difference, however. The China/Japan timeframe is something where you can still talk in real time, while the end of the business day in the U.S. is the beginning for the business day in Tokyo or China. The time difference between India and the west coast of the U.S. is totally opposite, so it's kind of disconnected.
I think we have certain advantages, and with the use of certain tools, we can take advantage of as much as six days a week. I think we do have some advantage in terms of experience in game development as well. I think eastern Asia is much more experienced in game development by itself, but they can learn too, so in the next few years we have to be really good to keep it up.
GS: Have you considered opening an office there?
SC: Actually our CEO did go to India to do a search, but we haven't announced anything yet.
GS: Last year I asked if you knew what the first game Tose made was. Can you say what it is yet?
KS: Well, we weren't born then! (laughs)
MA: I checked our website, and it seems to be Sasuke vs. Commander. It might have been a little bit later than 1979. SNK was the publisher. (in fact it was released in 1980)
KS: Before Tose, I was working for Sega/Sammy, and then before that I joined SNK right after they released Samurai Shodown.
GS: So you were part of the group that left SNK to go to Sega/Sammy?
KS: Yes. SNK was bought by Aruze, and the employees split off between the two companies. Most stayed with the Aruze group though.
GS: How long were you with SNK?
KS: Almost six, maybe seven years. Good old days. Super Sidekicks, and King of Fighters.
GS: Tose is still independent?
GS: Is there a majority shareholder, or is it all just Tose?
SC: It's a public company, so... the Saito family owns a lot.
GS: Are you allowed to say any more of the games you've released since we've last talked?
KS: So at the end, you’re asking this question! (laughs)
MA: Well, there's the PSP and Nintendo DS version of Avatar: The Last Airbender, published by THQ.