Square (video game company)
|Defunct||April 1, 2003|
|Fate||Merged with Enix|
|Headquarters||Meguro, Tokyo, Japan|
|Tomoyuki Takechi, Chairman|
Hironobu Sakaguchi, EVP (1991–2001)
Hisashi Suzuki, President and CEO (1995–2001)
Yoichi Wada, CFO (June 2000 – September 2001), President (December 2001 – 2003)
|Products||See complete products listing|
Number of employees
|888 (September 2002)|
|Subsidiaries||See subsidiaries and related corporations|
Square Co., Ltd.[b] was a Japanese video game company founded in September 1986 by Masafumi Miyamoto. It merged with Enix in 2003 to form Square Enix. The company also used SquareSoft as a brand name to refer to their games, and the term is occasionally used to refer to the company itself. In addition, "Square Soft, Inc" was the name of the company's American arm before the merger, after which it was renamed "Square Enix, Inc".
Square originated in October 1983 as a computer game software division of Den-Yu-Sha, a power line construction company owned by the father of Masafumi Miyamoto, the eventual founder of Square Co Ltd in 1986. While at the time, game development was usually conducted by only one programmer, Masafumi Miyamoto believed that it would be more efficient to have graphic designers, programmers and professional story writers working together. Square's first two titles were The Death Trap and its sequel Will: The Death Trap II, both designed by part-time employee Hironobu Sakaguchi and released on the NEC PC-8801. Despite an initial reluctance to develop for video game consoles, Square entered the Nintendo Famicom market in December 1985 with the porting of Thexder.
In September 1986, Square spun off from Den-Yu-Sha and became an independent company officially named Square Co., Ltd. Sakaguchi then became a full-time employee as the Director of Planning and Development of the company. After releasing several unsuccessful games for the Famicom, Square relocated to Ueno, Tokyo in 1987 and developed a role-playing video game titled Final Fantasy, inspired by Enix's success with a game titled Dragon Quest (later released in North America as Dragon Warrior). With 400,000 copies sold, Final Fantasy spawned multiple sequels over the years and became Square's leading franchise.
Square has also made other widely known games such as Chrono Trigger, Chrono Cross, Secret of Mana, Legend of Mana, Xenogears, Brave Fencer Musashi, Parasite Eve, Parasite Eve 2, SaGa Frontier, Romancing SaGa, Vagrant Story, Kingdom Hearts (done in collaboration with Disney Interactive), and Super Mario RPG (done under the guidance of Shigeru Miyamoto). By late 1994 they had developed a reputation as a producer of high-quality role-playing video games.
Square was one of the many companies that had planned to develop and publish its games for the Nintendo 64. However, with the cheaper costs of developing games on CD-based consoles such as the Sega Saturn and the PlayStation, Square decided to develop titles for the latter system. Final Fantasy VII was one of these games, and it went on to sell 9.8 million copies, becoming the second best selling game for the PlayStation.
On February 8, 2001, due to its first quarterly loss since going public, "the company implemented a restructuring plan for its Japanese corporate staff. Three key figures [were] moved around in the company ranks, resigning from their current positions to take responsibility for the losses, and ... reassigned to different positions. Sakaguchi would no longer be vice president and would instead be known as an ‘executive producer.’ Additionally, company president Tomoyuki Takechi [became] a contractual consultant for the company, with director Masahi Hiramatsu ... taking the role of executive consultant."
A merger between Square and its competitor Enix was in consideration since at least 2000; however, the financial failure of Square’s first movie, Final Fantasy: The Spirits Within, made Enix hesitant to join with a company that was losing money. With the company in its second year of financial loss, Square approached Sony for a capital injection, and on October, 8th 2001, Sony purchased an 18.6% stake in Square to bandage its loss.
In an interview with GIA.com in 2001, when asked, "Are you ever worried that Square will become too heavily dependent on the Final Fantasy name?", Sakaguchi responded, "Avoiding that has actually been one of Square's goals for a long time. It is our aim to try and develop a few more major franchises for the company; that has always been on our minds."
On November 26, it was reported that Square CEO Hisashi Suzuki was to step down as the company's president and that COO Yoichi Wada was to replace him in December with a restructuring plan for the company.
On May 28, 2002, it was detailed that in Wada's restructuring of the company, that "while Square formally took a development style where teams were formed and dispersed per project, developers wil now be fixed into divisions. Source codes and resources will be shared for efficiency, and employees will receive varying bonuses depending on the profit of their division. By settling developers into groups, Square also aims for the developers to re-use the titles they have developed, making game development more cost-efficient. Development costs- originally 2–3 Billion yen, are expected to fall to 1 Billion yen." Also, the company revealed plans to release two Final Fantasy X spinoffs that would later become Final Fantasy X-2.
Following the success of both Final Fantasy X and Kingdom Hearts, the company recovered its stability and recorded the highest operating margin in its history in fiscal year 2002. It was announced on November 25, 2002, that Square and Enix's previous plans to merge were to proceed officially. As described by Yoichi Wada, "Square has also fully recovered, meaning this merger is occurring at a time when both companies are at their height." Despite this, some shareholders had doubts about the merger, notably Square's founder and largest shareholder, Masafumi Miyamoto, who would find himself holding significantly less if the two RPG behemoths were to go ahead with the deal. Other criticisms came from Takashi Oya of Deutsche Securities, who expressed doubts about the benefits of such a merger. "Enix outsources game development and has few in-house creators, while Square does everything by itself. The combination of the two provides no negative factors but would bring little in the way of operational synergies, he said." Masafumi Miyamoto's issue was eventually resolved, by altering the exchange ratio of one Square share for 0.81 Enix shares, thus greenlighting the merger, and Square Enix formed on April 1, 2003. 
The Disk Original Group (DOG) was a union formed of no less than seven Japanese video game companies: Square Company, Limited, Micro Cabin, Thinking Rabbit, Carry Lab, System Sacom, XTALSOFT, and HummingBirdSoft. Founded July 14, 1986, Square took the lead in this alliance to produce games on the Famicom Disk System. Because Square controlled DOG, all DOG titles were published under the name Square. In reality, however, Square only produced four of the eleven games published under the DOG label. Excluding Tobidase Daisakusen (The 3-D Battles of WorldRunner in North America), which sold 500,000 copies, the remaining games were commercial failures.
DigiCube was established in February 1996. It was formed to market and distribute games and related merchandising (toys, books, music, etc.) in Asia. It declared bankruptcy in October 2003.
Escape, Inc. was established in 1998. They developed the racing game Driving Emotion Type-S.
Square Visual Works (CG studio), Square Sounds (sound studio), Squartz (quality assurance) and Square Next were all founded in June 1999. All were subsequently absorbed into Square Co., Ltd. in 2001 and 2002. Once Square merged with Enix, Square Visual Works was renamed Visual Works and produced CG animations for Square Enix and Eidos Interactive intellectual properties.
Quest Corporation was an independent software development studio established in July 1988, best known for the Ogre Battle series. Several team members, including Yasumi Matsuno, Hiroshi Minagawa and Akihiko Yoshida, left Quest in 1997 to join Square, where they worked on several titles for the Sony PlayStation, including Final Fantasy Tactics and Vagrant Story. In June 2002, Square acquired Quest.
The Game Designers Studio, Inc. (株式会社ゲームデザイナーズ・スタジオ, kabushiki-gaisha geimudezainaazu sutajio) was a shell corporation founded in June 1999 by Square. It was re-purposed in 2002 to create video games for the Nintendo GameCube, even though Square had an exclusive deal with Sony Computer Entertainment to create games only for PlayStation consoles at the time. To evade that deal, Square held only 49% of the shares while Akitoshi Kawazu, head of Square's Product Development Division-2, held 51%. The formation of a new company also made it possible to take advantage of Nintendo's Q fund for new game developers who develop for GameCube. Game Designers Studio only released a single game, Final Fantasy Crystal Chronicles. Square Enix's Product Development Division-2 de facto developed Final Fantasy Crystal Chronicles with publishing by Nintendo. Square merged with Enix in 2003 and formed Square Enix while Crystal Chronicles was in development. Square Enix later acquired 100% of Game Designers Studio and renamed it to SQEX Corporation. After the takeover of Taito Corporation in 2005, Square Enix merged it with SQEX in March 2006. The merged subsidiary took on the Taito Corporation name, but SQEX Corporation was the surviving company. On February 1, 2010, it was renamed Taito Soft Corporation and dissolved on March 11, 2010, effectively ending the company that started as The Game Designers Studio.
Square Soft, Inc. was established as the North American subsidiary of Square in March 1989. It was responsible for both the production and distribution of North American localizations of Square titles during the 16-bit era and continued to produce English language localizations of Square games in the 32-bit era. It has also been responsible for localizing several non-Square titles, including Capcom's Breath of Fire for the SNES. It developed the game Secret of Evermore for the SNES.
Unlike its Japanese parent company or other subsidiaries (such as Square USA), Square Soft was never dissolved and is currently known as Square Enix, Inc. Square Soft's original headquarters were in Redmond, Washington. Square Enix, Inc. is currently located in El Segundo, California.
Square USA, Inc. (originally Square L.A., Inc.) was established in August 1995. It operated as a high-end computer-generated imagery research and development studio and was integral in the production of graphics for Square-produced games since the beginning of the 32-bit era. Its headquarters were in Los Angeles, California and Honolulu, Hawaii. Like sister company Square Soft, Inc., Square USA was a wholly-owned subsidiary of Square Co., Ltd.
Square Europe, Limited was established in December 1998 to localize and market Square-developed games in Europe and Australia. Located in London, UK, Square Europe was granted exclusive publishing rights in Europe and other PAL territories for all interactive entertainment titles developed by Square.
Square Pictures was located in Honolulu, Hawaii and specialized in computer-animated films for Square. They started in 1997 to eventually "incorporate the movie division's technical advances into its games, spinning a cycle of creativity with games inspiring movies that in turn improve games." In 1998, Square partnered with Sony/Columbia to bring a full-length Final Fantasy movie to theaters "in the ambitious goal to be the first to simulate human emotions and movements through computer graphics." In late 2000, the film was revealed as Final Fantasy: The Spirits Within. Sony released the film on July 11, 2001, to mixed reviews and lower-than-expected box office numbers. It was considered a commercial flop, losing an estimated $94 million.
Square Pictures also created a short film for the Wachowskis that was a prequel to The Matrix Reloaded, titled Final Flight of the Osiris. The short featured photo-realistic characters, just as The Spirits Within, performing acrobatic moves in action sequences. The film was shown in theaters alongside Dreamcatcher and was meant to set the stage for the two Matrix sequels. The short was released on DVD on June 3, 2003, as part of The Animatrix. Square Pictures is now a consolidated subsidiary of Square Enix as Visual Works.
Joint-ventures with Electronic Arts
Electronic Arts Square
Electronic Arts Square, K.K. (エレクトロニック・アーツ・スクウェア株式会社, Erekutoronikku Ātsu Sukuwea Kabushiki-gaisha) was a joint venture between Square and U.S. video game publisher Electronic Arts responsible for publishing EA's games in Japan. It replaced a similar joint-venture business titled Electronic Arts Victor. The venture was 70% owned by Electronic Arts, and 30% owned by Square.
Electronic Arts Square struggled to make an impact on the Asian video game market, with most of its titles being unsuccessful in the market. EA Square handled the Japanese releases of games such as The Lord of the Rings: The Two Towers, Quake III: Team Arena, SSX and its sequel SSX Tricky, and various video games based on the Star Wars franchise. Electronic Arts Square had also developed a game, X-Squad, released for the PlayStation 2 during its launch.
Following the announcement of the merger between Square and former competitor Enix in 2003, Electronic Arts purchased Square's stake in the venture, subsequently renamed Electronic Arts K.K., which continued to publish EA's titles in Japan until 2019, when EA announced the closure of the offices as part of mass layoffs at the company.
Square Electronic Arts
Square Electronic Arts, LLC was another joint venture between the two companies, which was responsible for publishing Square's games in North America. Announced on April 27, 1998, Square EA was based in Costa Mesa, California and operated under Square president and CEO Jun Iwasaki. The venture was 70% owned by Square, and 30% owned by Electronic Arts.
When compared to EA Square, Square EA proved to be very successful, and during its five years of existence, released a higher proportion of localized Square titles to the American market than ever before.
Following the announcement of the merger between Square and Enix in 2003, Square purchased back Electronic Arts' stake in Square EA and folded it back into Square Soft, Inc., its North American subsidiary, which was subsequently renamed Square Enix U.S.A., Inc. (now Square Enix, Inc.) and continues to publish Square Enix's titles in North America.
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