The famous Japanese video game publisher Square Enix is parting ways with its North American studios Crystal Dynamics, Eidos Montreal and Square Enix Montreal, which are responsible for key franchises such as Tomb Raider and Deus Ex. A strong choice that results from a change in strategy. Square Enix intends to invest the $300 million raised to develop blockchain gaming, as well as artificial intelligence and the cloud.
Square Enix sells off its North American subsidiaries
It’s an announcement that made the effect of a bomb in the small world of video games. On Monday May 2, Square Enix explained in a press release that it was selling its North American subsidiaries Crystal Dynamics, Eidos Montreal and Square Enix Montreal.
The Swedish group Embracer won the bid by paying 300 million dollars, or about 285 million euros. A very reasonable sum compared to the last acquisitions made in this sector. As a proof, in 2020, Embracer had spent 525 million dollars to acquire Saber Interactive, a studio much less prestigious than those sold by Square Enix.
This deal makes Embracer a new video game behemoth. In addition to the three studios employing nearly 1,100 people, it gets its hands on a catalog of about 50 games and the intellectual property of prestigious franchises such as Tomb Raider, Deus Ex, Legacy of Kain or Thief.
A publisher at the forefront of blockchain gaming
By spinning off its North American subsidiaries, Square Enix plans to accelerate its transition to blockchain-based games. The Japanese publisher had already made a name for itself in this sector at the end of 2019, leading a $2 million fundraising to support the metaverse The Sandbox.
Square Enix had gone even further in November 2021, with the launch of its first ever collection of non-fungible tokens (NFTs). These were trading cards based on the Japanese franchise Shi-San-Sei Million Arthur.
On January 1, 2022, Square Enix’s CEO, Yosuke Matsuda, recalled the company’s position in favor of the development of NFTs in the field of video games. He took the opportunity to highlight Square Enix’s interest in blockchain and cryptocurrencies.
Square Enix faces grumbling from gamers
For careful observers, Square Enix’s decision is not surprising. It is in line with the company’s business strategy defined in May 2020, with three priorities in terms of investments: artificial intelligence, cloud gaming and blockchain-based video games.
By the way, Square Enix is far from being the only video game publisher to bet on NFTs and blockchain technology. Recently, the French giant Ubisoft distinguished itself by becoming a validator of the Tezos blockchain.
However, the Japanese group will have to be careful with these new technologies, as many players are wary of them. They fear that the speculative aspect will prevail over the simple pleasure of playing.
It is difficult to predict what the future of blockchain-based video games will be. But one thing is for sure, if publishers like Square Enix don’t want to alienate a good portion of gamers, they’re going to have to be smart in their approach. Cryptocurrencies and NFTs need to enrich the experience of video games, not distort it.