Ex-PlayStation boss says PS5 AAA games like God of War led to Japan Studio closure

PlayStation has shifted its priorities toward higher-budget AAA games, including God of War titles. According to former Sony Interactive Entertainment President Shuhei Yoshida, that contributed to the demise of Japan Studio. The makers of Astro Bot survived, but the change impacted developers of smaller projects like Ape Escape and Patapon.

An unexpected shutdown

Reported on by GamesRadar+, Yoshida spoke at the recent Computer Entertainment Developers Conference (CEDEC). He noted how, when the studio closed in 2021, it surprised fans who considered its games successful. Yoshida credits the division for some of the most innovative titles available on PlayStation consoles.

As the PS5 emerged, Sony focused on software that could help ensure a prosperous launch. Yoshida explains that “PlayStation wanted to drive hardware sales with games like God of War and Uncharted.” Unfortunately, Japan Studio produced “games they made weren't big in scale.”

Despite the upheaval, Sony continued to fund the masterminds behind Astro’s Playroom and later, Astro Bot. One factor was likely that Team ASOBI demonstrated the potential of the new console and DualSense controller.

In 2019, Yoshida was tasked with leading indie game development before leaving the gaming giant in 2025. Now, he encourages fans to support former Japan Studio devs thriving independently. Original Silent Hill director Keiichiro Toyama released Slitterhead in 2024. Meanwhile, Patapon creator Hiroyuki Kotani put his spin on the rhythm genre with Ratatan.

The AAA vs indie debate

Some critics argue that PlayStation has become too dependent on expensive AAA games. God of War Laufey will debut in February 2027, but the pace of new tentpole SIE titles has slowed. Embracing smaller undertakings would reduce the long gaps between arrivals, even if they generated less revenue.

Although Nintendo already dominated in the country, shuttering Japan Studio showed how Sony prioritized Western audiences. Even after shipping a cheaper region-locked PS5, its domestic console share still lags far behind its rival.