Tose

Basic Information

Stock Code: 4728
Industry: Information and Communications
Category Detail: Content Production & Distribution
Prefecture: Kyoto Prefecture
Establishment Year: November 1979
Listing Year: August 1999
Official Website: https://www.tose.co.jp/
TSE Information: TSE Information
Yahoo! Finance: Yahoo! Finance
Other Companies: KTK, Tekumira, Koei Tecmo Holdings, Nihon Falcom, Nippon Ichi Software, Yukes, Sega Sammy Holdings, Daiko Tsusho, Square Enix Holdings, Capcom, Konami Group

Overview

Tose is Japan's largest game software development contractor based in Kyoto Prefecture, founded in 1979, undertaking the development of major titles for a wide range of major game manufacturers.

Current Situation

Tose recorded consolidated sales of approximately 4.6 billion yen for the fiscal year ending August 2024, but operating profit and net profit were in the red. Its main business is planning and development of console game software, with numerous outsourced development contracts from major game companies such as Nintendo and Square Enix. As the industry's largest-scale outsourced development company, it has a track record of developing around 2,300 titles, many of which are not publicly disclosed due to confidentiality obligations between clients. It is highly regarded as a shadowy powerhouse with superior technical capabilities and information management. It also handles planning and development of mobile content. In 2024, it is advancing the integration of domestic and international bases to improve management efficiency. Amid intensifying competition, its strengths lie in a diverse customer base and extensive development track record, aiming for expansion in online games and smartphone development in the future.

Trivia

Interesting Facts

Domestic largest shadowy powerhouse that has undertaken development of approximately 2,300 game titles.
Holds copyright only for Nintendo's The Legendary Starfy series.
Involved in development of many major game titles but basically does not disclose.
Known as the 'shadow warrior' of the game industry, a company shrouded in mystery.
Uses pseudonyms in many end credits for thorough confidentiality management.
Has experienced a past incident of game production fee leakage to customers.
Collaborates with multiple publishers to operate electronic comic distribution business.
Establishes subsidiaries domestically and internationally to advance development across multiple bases.

Hidden Connections

Has deep technical collaboration with Nintendo as one of its second-party developers.
Also involved in main title development for Square Enix and Bandai Namco.
Has track record of developing historic masterpieces such as old SNK titles.
Numerous collaborations with other companies in specific fields like character design.
Plays a foundational role in the outsourcing of game development in the industry.
Extremely restrained in own branding to avoid conflicts between customers.
The 2007 information leak incident became a trigger for internal system improvements.
Early entry into mobile and smartphone fields to strengthen development capabilities.

Future Outlook

Growth Drivers

Strengthening structure to correspond with expansion of online and smartphone game markets.
Stabilizing orders through long-term contracts with existing major customers.
Promoting high value-added development utilizing latest technologies.
Efficient operations through integration of development bases domestically and internationally.
Expansion of new digital content distribution businesses such as electronic comics.

Strategic Goals

Building stable growth foundation through diversification of revenue structure.
Become a domestic top-level outsourced developer in online and smartphone game fields.
Strengthen technology to enter and expand into new genres.
Global standardization of confidentiality systems and improved reliability.
Establish sustainable corporate management model in collaboration with local communities.

Business Segments

Game Outsourced Development

Overview

Provides outsourced planning and development services for game software to a wide range of customers.

Competitiveness

Track record of approximately 2,300 titles and high customer confidentiality management

Customers

Major game manufacturers
Small and medium game studios
Smartphone game developers
Online game operators
Publishers
Entertainment providers
Overseas game operators
Video production companies
Advertising agencies
Educational institutions

Products

Planning and design services
Programming development
Graphics production
Platform optimization
Music and sound programming
Porting and remake development
Quality assurance and testing
Operation support
Mobile app development
Online game operations

Electronic Content Distribution Services

Overview

Planning and operation of electronic content distribution systems for smartphones.

Competitiveness

Collaboration with major publishers and electronic book distribution expertise

Customers

Electronic book publishers
Mobile carriers
Smartphone app platforms
Digital content sales companies
Advertising agencies

Products

Electronic comic distribution system
Smartphone content planning
Content management system
Marketing support services

Competitive Advantage

Strengths

Extensive development track record and industry-leading scale in outsourced development
Technical capabilities supporting diverse platforms
High reliability through thorough customer information management
Strong transaction relationships with major game manufacturers
Capable of mobile content development
Multi-language and multi-region development experience
Accumulated know-how and stable technical strength over many years
Solid financial foundation
Industry-standard quality management system
Flexible development team organization capabilities
Abundant human resources
Proactive adoption of latest technologies
Stable development schedule management
Strict enforcement of confidentiality agreements
Proprietary in-house development support tools

Competitive Advantages

Exceptional secrecy due to information isolation between customers
Trust and brand power built as a long-established company
Comprehensive capabilities across multiple genres and platforms
Numerous track records in porting and remakes of major game titles
Able to provide major-company quality at low cost
Agile development structure for flexible response to diverse requests
Global responsiveness through multiple bases
High adaptability to customer-specific requirements
Efficient productivity through proprietary development know-how
Accumulated experience ahead of many competing developers
Comprehensive service provision across wide technical areas
High industry evaluation for entrusted confidentiality
Stable orders from strong customer base
Efficiency improvements through focused management resources
Cost optimization via domestic and international subsidiaries

Threats

Intensifying technological innovation and price competition from competitors
Risk of contraction in the console game console market
Difficulty in responding to rapid changes in the mobile game market
Increasing constraints from strengthened copyright management in the game industry
Demand fluctuations due to emergence of new platforms
Risk of know-how loss from developer staff turnover
Economic and political risks at overseas bases
Internet information leakage risks
Increased development costs from stricter environmental regulations
Increased workload from diversification of smart devices
Growing burden of complying with customer confidentiality obligations
Domestic labor market talent shortage issues

Innovations

2024: Promotion of Management Resource Concentration and Base Integration

Overview: Improving efficiency through dissolution of Philippine subsidiary and closure of Sapporo Development Center.
Impact: Achieves reduction in management costs and improvement in development efficiency.

2023: Development of Final Fantasy Pixel Remaster Series

Overview: Handled development of Square Enix's classic remasters.
Impact: Contributes to evaluation in retro game market and acquisition of new customer segments.

2022: Strengthening Online and Mobile Game Development

Overview: Expanded planning and development structure for new smartphone titles.
Impact: Enables rapid response to market changes and promotes revenue diversification.

2021: Advanced Development Information Management System

Overview: Strengthened internal IT infrastructure to prevent information leaks.
Impact: Contributes to improved confidentiality reliability.

Sustainability

Strengthening information security measures to protect customer assets
Promoting work-life balance for employees to secure talent
Promoting community contribution activities
Reducing waste and promoting paperless operations
Environmentally considerate office operations