In the 1990’s, the rise of PersonalComputer (PC) gaming grew to be the dominant driver of growth in the computerglobal market and was gaining traction in Asia Pacific (Carlson, 2006). The hobby of playing video games led to the evolution of Electronic sports(e-sports) (Seitz, 2015). E-sports have diffused across the globe to the extentthat it generated revenue of $252 million (mn) in 2015.
In the same year, NorthAmerica dominated the global e-sports market with $93mn in expected revenue andgrows annually by 32%. Asia-Pacific is next in line stimulated by China withaccumulated expected revenue of $85mn and year-over-year growth of 28%. (Seitz,2015)In Asia Pacific, the demand for e-sportshas surged significantly and has incentivized major companies to investheavily, such as the Chinese Internet behemoth, Alibaba Sports Group, investing$150mn to build e-sports infrastructure such as e-sport stadiums across China,because e-sports is “a way of life” (Esports Observer, 2017). Over 1.2billion people play video games globally, in which more than 700 million videogamers play online, constituting 44% of the globe’s online population(Takahashi, 2013). Furthermore, e-sports have attracted brand sponsors such asCoca Cola to indulge in the frenzy of e-sports, as they are strategic partnerswith the e-sports community (Schutlz, 2017). The e-sports gaming market is anascent industry and companies stand to benefit form the lucrative commercialopportunity to generate revenue for not only the company, but also impact theGross Domestic Product (GDP) of a nation.
This strategic method could impactJapan and attract inbound travelers to participate in e-sport events happeningin other Asia-Pacific countries such as China. However, e-sports is not big inJapan due to the legal barrier; “the act against unjustifiable premiums andmisleading representations (Act No. 134 (May 15, 1962))” (Ashcraft,2017).ActNo.134 of 1962requires business operators to not be a misleading representation to thepublic. The business operator found liable to this act is enforced to pay anadministrative monetary penalty equivalent to 3% of the amount of the goods andservices charged (Sonoda, 2015). This act prevents Japan to join the globale-sports boom because the competitors who win and receive cash prizes ine-sports competition could promote a particular game they played to win andcould lure consumers to spend money on that particular game.
The ConsumerAffairs Agency in Japan considers this action as an example of breaching thelaw, Act No.134 of 1962 (Nikkei, 2017).This challenge does not prevent Japanese professional players to make a livinglike the players from China and South Korea, but prevents Japan to hoste-sports competition events. Furthermore, Hirokazu Hamamura, the president ofGzbrain, stated that “E-sports is mainly about games played on PCs, andJapanese gamers are not that familiar with this genre” (Nikkei, 2017).
Since Japan’s software makers, such as Square Enix Holdings Inc., Capcom Co.and Bandai Namco, made fortunes with Japanese consumers who prefer to playgames alone (Nakamura, 2017), this enables the Japanese consumers to developthe Galapagos syndrome. The Japanese’s difference is considered a virtue, whichcould lead Japan to deteriorate its global presence in terms of internationalpolitics and concerns as well as economic competitiveness and success (Stewart,2010).
However, in regards to Japanese gamers, they are training to refrainfrom the Galapagos effect.Since Japan was dominant in the world ofvideo games, Jikei Gakuen Group established an e-sports school in Osaka in anattempt to prevent Japanese gamers from developing the Galapagos syndrome andallow the students to participate and utilize their video-game talents incompeting strongly in the lucrative market, e-sports (Lewis, 2017). This is astep for Japan to engage with the global environment rather an continue to beisolated, which will attract inbound travelers to conform with theJapanese culture. If the Japanese government exempts e-sports from the act,Japan could have not only attract e-sport competitors to compete incompetitions hosted in Japan, but also influence e-sports internationalspectators and fanatics to experience the Japanese culture and enjoy itstourist attraction sites.
Another factor that dissuades inboundtravellers are uncontrolled natural disasters happening in Japan. Naturaldisasters fluctuate the frequency of inbound travellers who are susceptible tothese unexpected events (source). Sincetourism is an imperative driver impacting economic growth, these naturaldisasters may deprive inbound travelers to have unique experiences, businessventures, or opportunities in Japan. However, inbound travellers are sensitiveto unexpected occurrences such as frequent earthquakes with the magnituderanging between 6.2 and 9.0 (Chow, 2016), and the radiation scare due to theFukushima nuclear disaster. threatens them to visit Japan (Birmingham, 2011).On March 11, 2011, Japan experienced the Tohoku Pacific Earthquake, which thisincident accounted for over $195 billion of Japan’s expenditure towardsreconstructing Japan’s infrastructure (Nanto, 2011).
These phenomena do notonly dissuade the inbound travelers but also affects the incremental revenuegenerated from foreign tourists to strengthen Japan’s economic structure. As aresult, Japan experienced a staggering difference of a 28% decrease in tourismsector, from 8.6mn in 2010 to 6.
2mn inflow of inbound tourists (Moore, 2015).AlthoughJapan faced the 2008-09 global recession and the natural disaster in 2011, thefrequency of inbound travelers have impacted greater flight capacity due tolow-cost carriers, the depreciation of the Japanese yen and the visarequirements ease for inbound tourists to visit Japan (The Japan Times, 2014).In 2014, the influx of inbound tourists stormed Japan to over 13mn andcontinuously grew more than 19mn. Furthermore, Japan has transformed placesthat evolved through natural disasters into tourist attractions. For example,Japan has designated the radiated ghost-towns as a tourist attraction sites inFukushima, and the inbound tourists enjoy the Kinosaki Onsen – “the hot springsheated by volcanic activities” (DW Travel, 2016). Although, these touristattraction sites are dangerous, they are great historical tourist attractionssites to enthuse many inbound tourists to experience the unique culture ofJapan.
Also, the inbound tourists have the opportunity to develop the passionfor kawaii, value Wabi-Sabi; the melancholic, exquisite, beauty of nature andenjoy the varieties of products the Japan offers to not only their citizens butalso inbound tourists as well.