[clari.nb.govt] Japan Investigates Video Game Extortion Scandal

newsbytes@clarinet.com (02/04/90)

TOKYO, JAPAN, 1990 JAN 31 (NB) -- Several wholesale toy
and game distributors are under investigation in Japan for allegedly
forcing their customers to buy unpopular game software in order
to get the latest, hottest new games and game machines.

Japan's Fair Trade Commission's investigation of six wholesale 
stores revealed that retailers were forced to purchase unpopular
software cartridges for the Nintendo Famicon game machine in 
order to get a supply of Gameboys, hand-held game machines, and
the coming Dragon Quest IV game.

In a case which violates Japan's Antimonopoly law, Article 19, 
investigators say that last December, a wholesale store in Tokyo sent 
a facsimile message to retail stores telling them to buy 229 unpopular
game cartridges to get 100 packages of Dragon Quest IV. In another 
incident, a wholesaler in Osaka is said to have ordered its retail 
stores to buy 50 unpopular game packages to get 10 Gameboy units.

Game software maker Enix is scheduled to release Dragon Quest IV
on February 11th. Priced at 8,500 yen ($59), the game is expected to
be a mega-hit with game-hungry Japanese consumers; sales of 1.3 
million units are predicted for the first day of sale. 

Wholesale distributors are said to be exploiting not only the
expected popularity of Dragon Quest IV, but of Gameboy, the
hand-held portable version of Nintendo's popular Famicon game 
system, known as Nintendo Entertainment System in the U.S., of
which the public can't get enough. Gameboy first appeared in Japan
in April of last year at the price of 12,500 yen ($86). Gameboys
numbering 1,480,000 units sold in Japan and 1,140,000 units
sold in the U.S. through the end of 1989. It's currently very difficult 
to obtain even one as Nintendo has failed to meet market demand.

Dragon Quest III was involved in a previous scandal involving tie-in
sales. The Fair Trade Commission issued a warning and the problem
was under discussion even in the Diet. Enix consequently 
banned tie-in sales to wholesale stores since the end of last year.
Nintendo late last year also sent letters to wholesalers requesting 
they refrain from selling games only in bundles.

(Ken Takahashi/19900201)