Video game software developers are struggling to survive in a shrinking domestic market.

They've been hurt by a lack of success with new titles, and are relying instead on sales of updated versions of well-known titles.

Domestic sales of video game software was worth 446.2 billion yen in 2003, down 10 percent from a year earlier, according to the Computer Entertainment Supplier's Association. Sales have been on decline since peaking at 758.1 billion yen in 1997.

Square Enix Co. released the eighth generation of its popular Dragon Quest series on the weekend. The software debuted in 1986. Most of the previous seven installments posted sales of more than 3 million units each. Dragon Quest VII, which hit the market four years ago, sold 4.12 million units.

In the three days since its release on Saturday, Dragon Quest VIII sold 3 million units, becoming the first Japanese game for Sony Corp.'s PlayStation 2 consoles to reach the 3-million plateau.

Square Enix expects Dragon Quest VIII to help it clear its overall sales target of about 50 billion yen during the latter half of fiscal 2004. The company forecasts annual sales of 73 billion yen for fiscal 2004.

Aside from new versions of old themes, however, there has been no major success recently.

Given such a market environment, content developers are shifting their focus to converting successful arcade games into home-use titles and to games featuring popular animated characters rather than develop original products, which cost huge amounts of money.

This spring, Sammy Corp. released Hokuto no Ken, a PlayStation 2 game derived from pachinko pinball machine software.

Namco Ltd. has also converted its hit arcade game Taiko no Tatsujin (Taiko: Drum Master) for use in PlayStation 2 home-use devices.

The company also tied up with toymaker Bandai Co. in September to jointly develop a new game title featuring popular TV animation characters from the Mobile Suit Gundam series. The software will be marketed in 2005.

Banpresto Co. and FromSoftware Inc. plan to jointly develop a new title based on a cartoon featuring robots. The software is expected to be released in 2005.(IHT/Asahi: December 1,2004)