Square Enix president expects AI, 5G cellular, and digital payments to benefit gaming

Yosuke Masuda, president of Square Enix, predicted that 5G networks could make high-quality web browser games in the HTML5 format more popular. In a New Years letter today, Masuda also said that new digital payment technologies could also help gaming grow better in emerging territories.

Square Enix is one of Japan’s biggest with sales of $2.2 billion for its most recent fiscal year. Its interest in emerging technologies is important because Square Enix is the kind of company that can make them into mainstream tech.

“The environment surrounding the content industry is undergoing significant changes as advancements are made simultaneously in multiple technologies, including AI, xR (VR, AR, MR), next-generation communications systems, and payment infrastructure,” Masuda wrote. “As a result of these advances, consumers are likely to enjoy richer content experiences and greater convenience.”

Masuda noted that artificial intelligence got a lot of attention for its disruptive potential across many categories. And he noted Japan is focused on adding 5G wireless data infrastructure in time for the Olympics in Tokyo in 2020. 5G will offer gigabit-plus data transfer speeds over cellular distances at low costs. That could be a boon for high-quality HTML5 games, which do not require a download and can be played on any device with a web browser.

“Since HTML5 already enables web browsers to display high-quality 3D on par with native apps, browsers may garner renewed attention as a gaming platform once 5G networks are in place,” Masuda wrote.

He also said the expansion of “fintech” will put emerging markets on par with advanced nations when it comes to digital payments. That could help games take off beyond the major territories of Europe, North America, China, and Japan.

“As these examples illustrate, technological advancements result in new forums for creating content and in new business opportunities,” Masuda wrote. “For this reason, they are a major enabler for content producers in their efforts to provide their customers with new experiences. We look for such advancements to gain even further momentum in 2018 and beyond.”

He also noted that annual smartphone shipments are now in excess of 1.5 billion units. He was impressed with console sales of the PlayStation 4 (above 70 million units) and the Nintendo Switch (above 10 million units), as well as the potential of the Xbox One X, which he said “got off to a good start during the holiday season.”

“While the consumer console game market has been solid in the West over the past several years, it has struggled in Japan. However, we expect the Japanese market to gain significant vitality going forward as it joins the overall trend,” he wrote.