Increases in the realism of video games are limiting the ability of Japanese games to appeal outside of their home country, according to the president of Nintendo.

"Because the expressions in games are becoming more and more photo-realistic, I imagine that the cultural differences in acceptance have started to be reflected more clearly," Nintendo chief Satoru Iwata told a group of investors in Japan last month. "I think this is the reason why western users tend to prefer software created overseas than software from Japanese software developers."

Iwata said he has seen the influence of Japanese-made games decline in the past thrree or four years, since the decline of the PlayStation 2. "Nintendo is doing what overseas software developers do not do, so Nintendo's software is selling relatively well also in foreign countries, but for the software oriented to enthusiastic game players, such as Call of Duty, the ones created by overseas developers are more mainstream in the overseas markets."

While Iwata didn't name any games other than Call of Duty to explain his theory, it's true that, during previous generations of gaming hardware, Japanese-made games, be they Resident Evils, Metal Gear Solids, Final Fantasys or others, were more consistently topping sales charts. American and European-made games appear up there more often now, specifically the likes of Call of Duty and Assassin's Creed.

The graphics theory, which Iwata made clear is just one possible culprit, is interesting, but it doesn't seem like it will translate into Nintendo, say, making more realistic-looking Mario games. "Of course, Nintendo will continue to run a business by creating Nintendo-like games," he said, "but we will not be able to meet the various tastes of consumers by only doing this, so I feel that it will become necessary to reinforce the development resources in the foreign countries. Therefore, I hope we will be able to show you something like that at E3."

E3 is when Nintendo will show playable versions of its new 2012 console. What might be running on it? Iwata's comments let the imagination run wild and suggest that, if there aren't great-looking Western-made games on it, Nintendo's got a problem.

Kotaku, the Gamer

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Very, very interesting. All these cryptic comments from Iwata have me concerned, yet hopeful. We'll see.

Finally, it sounds like Nintendo is gonna make some new IPs and with realistic graphics. Since their trying to appeal to the West so maybe they will be hardcore. Hmm count me excited for E3!

Hmm... I hope they don't just start dishing out realistic CoD like games just to appeal to that kind of gamer. I enjoy realistic games like Uncharted but I find more enjoyment from games that have a cartoony style. Less realistic games appeal more ,visually wise, to me than realistic ones. Some good examples are Okami, Patapon, Viewtiful Joe, and (at least to me) LoZ Wind Waker.

Based on the statement I think their going to do both.

Calling Mother [earthbound] 3 with ultra-realistic HD graphics.

I want 3rd party games to be realistic, but hope the Mario games just look like Mario Galaxy but in HD.

To the contrary -

It seems that they'll continue to do what they traditionally do while seeking to bolster relationships with western developers.

I hope this doesn't mean less localization of Japanese games. I prefer the Japanese style of games.

Okay, I didn't read the thread, but people NEED to stop posting that "realistic" Mario picture. It's starting to affect my ability to sleep.