Curious why there are so few releases of Japanese titles on the Xbox Live Arcade? If you said xenophobia you would be in the majority, but if you said it was because of Microsoft's wonky Point currency and how it takes advantage of the weak U.S., dollar to take advantage of digital export sales from various content creators, you wouldn't be wrong.
Michael Futter has an interesting examination of the problem on a post over at XBLA Fans, which examines why some content providers, even those Stateside, have avoided dealing with the Live Arcade for content releases and/or patching, an issue that came to an explosive head when Fez creator Phil Fish had to leave a broken patch up on XBLA that destroyed the playability of the game due to the expensive costs of patching on Microsoft's closed console system.
But things were brought to a much clearer light when G.Rev president Hiroyuki Maruyama talked about why their games aren't on Xbox Live, including their recent PlayStation Network release of Under Defeat HD. In a translated post from Maruyama's twitter account, the G.Rev prez states that...
“A strong yen and a weak dollar is very damaging to us because XBLA and DLC are ‘export products.’ That’s why Japanese developers avoid making games for Xbox 360. When we released Strania on XBLA, the rate was 80 yen per dollar. (wry smile) If Japanese people buy our game in MSP, we receive in dollars!”
According to Futter's analysis, there's a fixed conversion rate in Microsoft Points so 1600msp, which is about $19.99 in standard USD, translates into about ¥2,240, which is equivalent to $24.99 in USD. Now the real problem comes in when consumers buy MSP at the suggested currency exchange rates but the revenue from the XBL purchase is still fixed for the content creators. So even if Japanese gamers bought 1600 MSP, G.Rev would only get back in revenue the USD rates of 1600 MSP and not what Japanese customers paid in the appropriate exchange for the actual 1600 MSP in Japan...or so, that's the argument that Maruyama is making.
Microsoft has come under fire many times from many developers, especially Team Meat, for having a closed off system that makes it difficult to not only get games on to the Live Arcade but also makes it a financial quagmire. Maybe they'll fix that heading into the next-gen with their newest console, expected to be unveiled later this year?