America: My Time

Chapter 59 Arcade Games
Chapter Fifty-Nine Arcade Games

Because of the presence of an outsider like Iwata in this meeting, both John and Akio Morita had many things left unsaid. They couldn't trust the Japanese government, or even Iwata himself. This wasn't a major problem for John and wouldn't have much impact, but it was entirely different for Morita. If certain things became known to the other side, they might quickly fall into the hands of Sony's rivals, something Morita certainly didn't want.

Iwata Honya knew that his presence was affecting Akio Morita and John. After a conversation and confirming John's commitment to TV Tokyo, Iwata Honya got up to say goodbye to Akio Morita and John, not wanting to interfere with their conversation or be the 'bad guy'!
After Iwata left, John and Akio Morita both breathed a sigh of relief. Although Akio Morita had confirmed the Japanese government's opinion beforehand and knew there wouldn't be much resistance, the fact that it was confirmed now was the best thing ever!

"John, there are no issues with the Japanese authorities. I've already discussed things with the newspaper. As long as you're ready, the transaction can proceed at any time. Are you ready?"

"We're ready. Phoenix Entertainment has acquired a controlling stake in a toy company, which will be the main entity in the acquisition of TV Tokyo. In the acquisition, the toy company will hold 75% of the shares, Phoenix Comics and Animation will hold 20%, and the remaining 5%, or rather 4.9%, belongs to Naoko!"

Naoko was shocked when she heard John's words. She hadn't expected him to make such an arrangement and give her such a large sum of money. Although it was only 4.9, it was still a considerable amount of money, at least for her. Despite being a top idol, her own income was actually quite low; she only started receiving a share of the profits after transferring her nationality.

Naoko wanted to refuse, but John stopped her with a look. John wasn't stingy with his woman. If it weren't for concerns about Naoko's status being unsuitable, he would have even wanted her to invest in the holding company and take a stake. However, her idol status meant high exposure, and doing so would be bad for Naoko. Since Naoko didn't want to give up her career, he only left her 4.9% of the shares!

Akio Morita was taken aback by John's suggestion. He hadn't expected John to be so kind to Naoko, even though it was only a 4.9% stake, which was still quite unexpected and surprising.

However, the old fox Akio Morita immediately understood John's intention, realizing that it was to protect Naoko. So he nodded and said, "That's right, this is a very appropriate way to handle things, and it satisfies everyone involved!"

Akio Morita didn't care about funding issues at all. He knew that in Japan's banking sector, many people wanted to give John money and get him loans from their banks. Funding was never a factor hindering acquisitions.

Compared to Naoko's shock, the woman beside Akio Morita looked on with envy. Naoko was so lucky to have met such a good man. She had only been with him for such a short time and had already received such a large sum of money. It was unbelievable. She thought John was too generous!

Will anyone try to take over Naoko's shares? No one dares to do that. Anyone who dares to touch those shares is not only provoking John, but also slapping Akio Morita in the face. Sony is not someone to be trifled with.

"Mr. Morita, please accelerate Sony's investment in arcade machines. With Sony's current production capacity, it's insufficient to support the demand in the European and Asian markets. Once the North American market stabilizes, Sony will face the enormous European and Asian markets. If Sony delays too long, I fear there might be unforeseen circumstances. Not to mention the European market, even in the Japanese market alone, many companies are eyeing arcade machines. Even with patent barriers protecting the gaming world, it can't stop these companies from investing heavily. Even if their quality isn't as good as the gaming world's, it will still have a huge impact on the market. The patent barriers for arcade machines are very different from those for home consoles and handheld game consoles. You should also understand that the gaming world is expanding rapidly, and there will be even more games next year!"

Upon hearing John's words, Akio Morita seemed to ponder. Increasing investment in arcade games was indeed a difficult decision to make. Every investment by Sony would put considerable pressure on them. It was easy to increase production lines, but extremely difficult to reduce them, as workers could not be laid off at will.

Seeing Akio Morita's hesitation, John smiled calmly and said, "The arcade market won't have any major problems for at least ten to twenty years. Of course, this is just my personal opinion. Even taking the minimum timeframe of ten years as an example, this investment is worthwhile for Sony, and the returns will be very substantial. I can tell you clearly that Game World will not participate in the production process; research and development is our focus. If Sony were making home consoles, I wouldn't have made this suggestion, but Sony is making arcades, and arcades have a very rapid pace of technological advancement." John paused here, giving Akio Morita time to think. After a moment, he took a deep breath and continued, "Game World intends to conduct a round of financing at the end of the year. If Sony is interested, they can participate. This round of financing isn't large; it's necessary before the IPO."

Was John being kind, intending to give Sony and Akio Morita benefits? No, John wasn't that kind. The reason he told Akio Morita this news was that he hoped Sony would get involved, using Sony and other contract manufacturers like those in Japan to suppress Morgan and other US investment banks, so that the gaming world could gain the greatest benefit!

This is just the first step John is taking to suppress American investment banks. With the participation of companies like Sony, the market value of the gaming world will be greatly increased. Next, he will launch a counterattack against Atari, completely crush Atari, and a new means to increase the value of the gaming world will emerge.

The royalty system will be a means for the game world to constrain game companies and also a method to increase the market value of the game world.
In short, anyone who wants to use the game world platform has to pay money, tolls to the game world. Game companies all know that cartridges are more profitable than game consoles. As long as their game is good and the promotion is good, with a good game platform, making money is as easy as drinking water. Right now, the game world platform is the best, and when this situation occurs, it is also the most profitable time for the game world!
However, all of this requires the cooperation of Japanese companies like Sony. Knowing the Japanese as he does, John knows they won't let this money-making opportunity slip by; at least Akio Morita certainly won't. As the OEM manufacturer, Sony naturally understands that the success of Game World is just the beginning, and this is the most profitable time to invest in Game World!
“Okay, I will be prepared. Sony will increase its investment in the production process!” At this moment, Akio Morita finally made a decision. Although this was only John’s opinion, Akio Morita believed it.

Putting aside everything else, the market is a good example. The game market is really crazy these days, especially the North American market, which is huge. Europe is no less than North America, and Asia may be a little smaller. However, the Japanese market is very large. Overall, the Asian market may be smaller than the North American market, but not by much. The entire game market is huge.

Developing the gaming market would bring huge profits to Sony, and the expansion of the arcade market would also expand the television market. Akio Morita could not resist this temptation, and neither could Sony.

Now that John has offered huge benefits, Akio Morita has indicated that TV Tokyo is just the beginning. John's expansion in Japan's industries requires Sony's assistance. Morita understands this without John even having to ask; it's an unspoken understanding. If Sony doesn't even do this much, the cooperation between the two sides is just empty talk!
Without obstruction from the Japanese government and with Sony's assistance, this acquisition will proceed without problems, and no one will cause trouble at this time. Otherwise, it would be a slap in the face to the Japanese government and Sony, and would also provoke John's anger, potentially affecting trade between the United States and Japan.

John is not the same person he was a few months ago. Legendary Entertainment now wields media power, and although it's not huge, it still has its own voice. If the acquisition or investment in Japan is blocked, John will definitely not sit idly by and will teach them a lesson they won't forget.

The conversation with Akio Morita was relaxed and took place only at TV Tokyo. No other topics were discussed. Further actions will only be taken after the acquisition of TV Tokyo is completed. Only after the acquisition is completed will the loan to Bank Neon be increased to fully invest in the expansion of Japan.

With John's current assets, obtaining a loan from the Bank of Japan wouldn't be difficult; two billion would be easily achievable, and even more if John were willing to provide more collateral. The Bank of Japan currently has plenty of US dollars on hand.

After having dinner at Akio Morita's place, John and Naoko returned to their own residence in Setagaya. They owned a property there, and instead of going back to Matsutō Garden that night, they stayed at the Setagaya Bamboo Garden.

(End of this chapter)