More than a decade ago, Japan pioneered ways to profit from mobile games with a technique called gacha, which nudged players to spend lavishly on acquiring special characters or mighty weapons. Now developers, publishers and analysts say the trailblazers have peaked and their future is one of steady decline.
Gree Inc, one of the gacha innovators, is seeing in-game revenue fall, while rival DeNA Co prepares to book its first fiscal-year net loss since going public in 2005. DeNA chief executive officer Isao Moriyasu warned the company’s earning power from games "has weakened drastically”. Colopl Inc said revenue in the most recent quarter was flat, suggesting its portfolio is slumping except for the mobile hit Dragon Quest Walk.