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And the Crystal Tools engine is starting to look really dated.
XIII-2 and Lightning Returns, sure. That's multiplat development's problem. XIII (PS3) and Versus are beautiful looking games. Crystal Tools is basically a Sony Engine.
Indeed (though in XIII-2, Academia and Valhalla look excellent). I'm currently re-playing XIII and I'm still wowed by areas like Lake Bresha, Gapra Whitewood, Sunleth Waterscape, Nautilus, etc. etc. etc.
And of course the cutscenes, both in-game and CGI, are still freaking gorgeous.
Part of the reason they do this is that the documentation and knowledgebase articles for Unreal aren't in Japanese. Part of it is a stubborn refusal to use any middleware at all.
Anyways, this internal engine development is foolish. They have guys who made PS1 games working on them. Program game and program software development tools are not generally the same skillset. There's some guys who can do both, but just because you've done the former doesn't mean you'll be good at the latter.
From's got the right idea. License Havok and whatever else you need and make your own badass game with the money you have not giving a damn who tells you gamers are too dumb for it.
Is there another Japanese company that makes a 'Japanese' engine? SQEX might want to use only a Japan-made engine (especially for Final Fantasy and 'Japanese' titles) and sees no appeal in a 'Western-created' engine.
If, on the other hand, other Japanese companies use 'pre-made' (especially Western) engines, then I have no idea what Square Enix thinks it's doing. Welcome to the 21st century, Square Enix. Stop trying to do everything yourself and just specialize in making games onegaishimasu. Faanzu uiru bii berii ureshii yo.
Engine's an engine. A Japanese engine isn't going to have more capabilities for making a japanese game than an English, German, Polish, Russian or American one. It's sort of like saying you need a japanese-made cell phone to speak japanese on a conference call. You don't. The content of the call is the content of the call.
One might have better Japanese documentation. But quality of documentation goes hand in hand with frequency of use. And there isn't going to be a Japanese made engine that sees as much widespread usage as Unreal or, I don't know, Cryengine.
To be honest, it might be easiest just to get one bilingual programmer on staff whose job is to translate Unreal's kb docs.
Oh, as to other Japanese companies that use external engines:
A bunch of them use something called Phyre, which is a Sony engine developed in Europe. Off the top of my head, the Souls games and the Atelier games use it. Possibly some of the disgaeas.
Souls games also use Havok, which, while not an engine, is a form of middleware.