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Square Pictures Continues On Its Own After 'Final Fantasy' Film Stalls

5 Oct, 2001 By: John Gaudiosi

After investing four years and over $135 million in a state-of-the-art CGI movie studio in Honolulu, Hawaii to create the revolutionary photo-realistic Final Fantasy: The Spirits Within, Square Pictures’ parent company, Square Co. Ltd., has ceased funding of the studio, but will allow the studio to continue operations.

Square c.e.o. Yoichi Wada blamed the feature film’s poor box office in the U.S., where the film grossed $30 million, $50 million to $60 million shy of what Square had anticipated, as well as a lackluster Japanese showing of over $9 million -- although it’s still playing -- for its decision to stop producing feature films.

After posting an operating loss last year, Square had anticipated a net profit of 700 million yen (about $6 million) for this fiscal year, but due to the expense of the film, the company now plans to book a loss of $13.9 billion yen (about $115 million).

Square Pictures will continue to develop CGI projects, funded by other studios. Square Pictures president Jun Aida said that Square Co. Ltd. currently has no plans to sell the studio or close it down.

“We’re currently running as an independent studio, working on one project and actively discussing our next animated project with Columbia Pictures, which we hope to have finalized in the next three to four months,” said Aida. “The forecast looks very good.”

Among the options Aida is discussing is a Final Fantasy sequel or prequel, which could bow theatrically or go straight to DVD. The studio could also go for a more stylized animation project, in the tradition of Shrek or Toy Story. Aida did not know what involvement Hironobo Sakaguchi, the creator of the Final Fantasy video game series and director of the first film, will have in the studio’s next project.

While the Final Fantasy DVD debuts Oct. 23 at retail, Aida said plans for an enhanced PlayStation 2-specific DVD, which would allow consumers to edit angles and lighting in real-time using the PS2 processing power, has been put on hold. The company is still developing real-time rendering technology, which will be implemented in its next project, cutting down both the amount of development time and the cost. This technology could be used for PS2-enhanced DVDs.

After employing 220 graphic artists, engineers and programmers at its peak, the studio currently has a staff of 125. Aida said the studio would recruit an additional 40 to 50 employees should they go ahead with a photo-realistic CGI film, or an additional 10 to 15 employees if they go the stylized CGI route.

In other Final Fantasy news, Sakaguchi announced that SquareSoft plans to develop a series of next- generation video games based on the new Final Fantasy Unlimited anime TV series, which debuted in Japan Oct. 2 and is an offshoot of the bestselling video game franchise. Video game Final Fantasy X ships for PS2 in January 2002 and Final Fantasy XI, which will incorporate online gameplay, is expected to ship in the U.S. in 2003 for PS2 and PC.

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