Square Enix has recently announced the sale of several of its Intellectual Properties (IPs) and studios to Swedish game publisher Embracer group for $300 million. The studios include Crystal Dynamics, Eidos-Montréal, and Square Enix Montréal as well as the IPs for the Tomb Raider, Deus Ex, Thief and Legacy of Kain franchises. Square Enix states that the sale was to fund its its development of blockchain, cloud and AI technology.
Square Enix on their part has stated that they have sold these studios and IPs to provide much-needed cash flow for the company to allow them to keep operating and develop their more profitable IPs. They have also stated that the cash flow will be used to invest in blockchain, AI, and cloud technologies which is the direction the company is headed.
This is quite in line with Square Enix President Yosuke Matsuda’s statements about their desire to incorporate blockchain technology in their games. This means the use of NFTs as items owned by players which can be converted into crypto tokens which in turn can be traded for real-world currencies. Matsuda believes that blockchain technology and crypto token economies can usher in a new era in user-generated content for games.
Crystal Dynamics and Eidos are responsible for some of the largest game sales for both the Tomb Raider franchise and the reboot. The reboot which had three titles, Tomb Raider, Rise of the Tomb Raider, and Shadow of the Tomb Raider, was able to sell 35 million copies and was a huge success. Eidos was also responsible for the revived Deus Ex franchise that brought the titles Human Evolution and Mankind Divided great success as well.
For many fans of those franchises, this sounds like the end of game development for those titles but the Embracer group has assured players that they will continue development where Square Enix has left off with those titles and are already in the works for future franchises. The biggest question though for some is the Marvel games produced by Square Enix and where it is headed as no word as of yet what Embracer group’s plans are for the franchise.
NFT and blockchain gaming has had a huge impact on the market already. In the 2021 NonFungible.com report, NFT gaming accounted for the second-largest amount of transactions equating to $5.7 billion out of the total $17.6 billion total transactions in the NFT space. Traditional games such as Ragnarok Online have even ventured into NFTs as well with $40 million dollars being spent by users for their NFT sprites. There also has been a boom of pitches in venture capital companies for blockchain games this year as well.
The hype for blockchain technology and its benefits to gaming is very real that apart from Square Enix, big-budget studios such as Ubisoft, Sega, and Bandai Namco have all expressed their desire for integrating blockchain technology or already have made efforts in the games they publish.
Despite this, however, there is still a huge negative outlook toward NFT and blockchain from gamers in the mainstream community and typically for western audiences. Upon the announcement of Ubisoft that Ghost Recon Breakpoint will be integrating NFTs, it received such negative backlash on YouTube that the company had to take down the announcement trailer. Another popular game on Steam, Storybrook Brawl, was review bombed upon the announcement that it will integrate blockchain when the game’s publisher was acquired by crypto exchange company FTX.
It looks like, however, that Square Enix is pushing forward with its plans for blockchain and only time will tell if their venture will be successful with mainstream gamers.