After not one, but two Western-developed sales blunders, Capcom is planning to stick with its home turf.

Capcom's president, Haruhiro Tsujimoto, tells the Financial Times that the company is giving up on developing new franchise titles in the West after the catastrophic sales of two of its attempts, Bionic Commando and Dark Void. Predicted to sell in the millions, neither did better than 750,000 copies. Now, Capcom wants out.

We already knew back in December how upset Capcom was about Bionic Commando's less than average debut. However, Dark Void may have been the straw that broke the camel's back.

Without the fan base or movie tie-in of, for example, its successful Street Fighter franchise, Capcom realized that original titles like Dark Void were too risky to keep investing in. From now on, the only reason the company will employ developers from outside of Japan is to build sequels or new versions of their existing games. (See: Bionic Commando Rearmed 2, Dead Rising 2.)

Tsujimoto said he in part blames the changing face of the game industry—now rife with downloadable games, social gaming, and new gaming platforms like the iPad—for the lower sales of new Capcom packaged game titles. He said Capcom will focus its efforts on developing new games for these new mediums instead.

Capcom shuns foreign game developers [FT.com - subscription]

Last year was a rough year. Just ask Osaka-based Capcom. The game company, which is best known for the Street Fighter series, sales profits down. Way down.

According to an official statement, Capcom saw new sales down 27.3 percent to ¥66.8 billion. Net profit was down 73.1 percent from the previous year to ¥2.17 billion.

Sales were strong in Japan for titles like Wii game Monster Hunter Tri and PSP game Monster Hunter Freedom Unite. Elsewhere, games like Resident Evil 5 and Street Fighter IV continued to do brisk business.

"However, weak sales of some new titles besides the releases of Lost Planet 2, Super Street Fighter IV and Monster Hunter Tri for overseas were postponed to the next fiscal year significantly depressed sales compared to previous year," stated Capcom. Those "weak" selling titles, Capcom noted, were namely Bionic Commando, Resident Evil: The Darkside Chronicles and Dark Void.

But with a battery of big titles coming out, Capcom should be just fine.

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The man behind Mega Man is very busy these days.

Not because of his 1987 creation and the more than 50 games it spawned since. No, Keiji Inafune's work is sadly free of the blue humonoid robot and his endless battles. Nowadays Inafune spends most of his time traveling the world keeping an eye on Capcom's other creations.

As the game maker's new head of global production, Inafune says he has only one goal: To make sure that all of Capcom's games have that, to borrow a French phrase, je ne sais quoi.

"It's a common comment I hear that games created in Europe aren't really Capcom games, that games created in Japan are true Capcom games," Inafune recently told a gathering of journalists at their annual Captivate event in Hawaii. "I want to put an end to that, basically saying that whether games are created in America or Japan or anywhere in the world, I will be the one overlooking it and so it will have that Capcom flavor that fans know and love."

The news comes after a mixed year for Capcom. The past 12 months or so saw the publisher help to reinvigorate the fighting genre with the release of Street Fighter IV to consoles and the continued success of their Resident Evil franchise, but it also saw a few flops including Bionic Commando and January 2010's Dark Void.

Capcom's biggest disappointments of the past 12 months have to be Bionic Commando, which received middling reviews, and Dark Void which was perceived, at best, as forgettable. Both were products of a new initiative by the Japanese developer to try and blend the aesthetics, artistry and mechanics of Western and Japanese game design.

That initiative was announced at the 2009 Captivate event in Monte Carlo. At the time Inafune said that Capcom knew it needed to figure out how to climb out of what he called a pit that had Capcom at the bottom of the industry. The key, he realized, was to focus on globalization. The first result of that effort was the widely acclaimed Dead Rising, a game that other developers, he noted, said looked Western but felt Japanese.

So last year they decided to push things further west, perhaps a bit too far west.

Now, Inafune says the company is working to perfect this idea of collaboration not only between studios, but cultures.

Dead Rising 2, for instance, is being created by Canadian studio Blue Castle Games, but Inafune is making sure that the game will still have that Capcom feel.

"One of the biggest things we do is have more staff visits," he said. "We have a deeper collaboration through the sheer amount of communication, a lot more meetings, a lot more emails.

"Rather than have the development team do what they want to do by themselves, Capcom is trying to inject the Capcom flavor into it."

And, judging by what I saw earlier this month, it seems to be working. Dead Rising 2 feels like a game that has found the sweet spot between Western and Japanese game development.

While Inafune may have been overstating things last year when he said that Japanese game development has one foot in the grave, he's right to be worrying over his own company's health in an increasingly global gaming market.

The key, though, will be for Capcom and other Japanese developers to find a way to make games that appeal to a broad spectrum of gamers without losing a sense of where they came from and who they are. And that means being willing to make some bad games and learn from those mistakes.

The coming year should show whether Capcom is able to put into practice the lessons that Dark Void and Bionic Commando seems to have taught them and produce a game that is the best of two worlds.

The man behind some of Capcom's biggest video game creations is now in charge of personally assuring that all of the developer's titles are hits.

"It's a common comment I hear that games created in Europe aren't really Capcom games," said Keiji Inafune, the man behind Mega Man, Dead Rising and Onimusha. "That games created in Japan are true Capcom games.

"I want to put an end to that, basically saying that whether games are created in America or Japan or anywhere in the world, I will be the one overlooking it and so it will have that Capcom flavor that fans know and love."

To accomplice that Capcom named Inafune the company's global head of production.

"So one of the thing I want people to know is that now that I am overseeing every part of Capcom R&D you can be sure that that unified vision is going to come through in all of our titles no matter where they are created."

Inafune's new title comes just a year after the company stressed their desire to create more games around the world to appeal to a wider, more diverse audience, something Inafune has long championed.

"Those of you who know me, know how serious I am about trying to make global games on a global scale especially thinking about America and Europe when designing a lot of our titles," he said. "I've been pushing really hard for the last several years to try and gear our games in that direction."

But, he said, the problem was that some of their studios and teams didn't have one "unified direction"

To help Inafune deal with developers in other countries, he also hired Shinji Futami to serve as his "mouthpiece to convey (Inafune's) feelings, his ideas, his philosophy to the U.S."