Nintendo Tells Square “Never Come Back” After Fallout Over Final Fantasy VII

At one point in time, Nintendo and Square were synonymous in the video game industry. Square had released many of their biggest RPG hits on the Super NES like Final Fantasy VI (or III in the US) and Chrono Trigger. Square was loyal to the Big N in the early to mid 90s until Final Fantasy VII came along, as pointed out by Yoshihiro Maruyama, Executive VP Square U.S in a recent discussion with Polygon.

[In September 1995] I was hired by the president of the company, [Tetsuo] Mizuno-san, and he told me that, “Squaresoft will always be with Nintendo. … As long as you work for us, it’s basically the same as working for Nintendo.” And the week after I joined, they started saying, “Oh, maybe we should switch to Sony.” So I was kind of shocked.

And Maruyama-san wasn’t the only one in shock over the fallout between these two Japanese Giants.  The rest of the gaming community was just as shocked, and some were devastated and doubtful of how things were going to turn out with Square’s new future outing with Sony (PS One). The decision was simple – it came down to which of the two new systems could offer Square enough storage space to make their RPGs.

Final Fantasy VII - the game that changed the history of Square and Nintendo

Final Fantasy VII – the game that changed the history of Square and Nintendo

Hironobu Sakaguchi, Producer and Executive VP, Square Japan (and father of the Final Fantasy game series):

Of course, back then I wasn’t the president of Square. There was a management level above me, and I talked with them to make the decision. But PlayStation games being on CDs was the biggest factor. If you wanted to make a 3D action game on a Nintendo 64 cartridge with that limited space, you could do it. But I wanted to create a 3D role-playing game. It was very clear in my head what I wanted to make, but that would have been difficult on Nintendo’s hardware.

The biggest problem was, of course, memory. Based on our calculations there was no way it could all fit on a ROM cartridge. So our main reason for choosing the PlayStation was really just because it was the only console which would allow us to use CD-ROM media.

Shinichiro Kajitani, VP, Square USA:

At that time, Square was really close to Nintendo. We were basically like a second party for them. So when their new system was in development, we gave them lots of advice, like, “You’re going to need a CD-ROM drive for it,” “You don’t have enough bandwidth to do what we’re trying to do,” and, “With what you have now, we’re not going to be able to make an RPG.” We gave them lots of advice. But [Nintendo president] Yamauchi-san at Nintendo basically refused to listen to any of it. And that’s when Sakaguchi-san and the management team at Square decided, “OK, we’re going to go with Sony now.”

And it wasn’t like Square didn’t try to make it work with Nintendo.

Hiroshi Kawai, Character programmer, Square Japan

We spent a few days, I remember, optimizing my code, to try to get a few more polygons out, but it didn’t really make much of a difference. And upon returning to Tokyo, there was a meeting with me, Narita-san, Sakaguchi-san and the major stakeholder of Square, Miyamoto-san. And I had never seen [Miyamoto in person before then]. He just comes in. “OK so, how was it?” And I gave a few figures when asked, but Narita-san was the main person who was talking. And he was essentially saying, “We’re just not getting the performance. We’re nowhere near what we did during the Siggraph demo.” Miyamoto-san just silently acknowledged that, and I didn’t hear anything from them until the point when Sakaguchi-san called [the office] together and said, “We’re not doing the 64 anymore.” So yeah. I guess in a sense, I kind of provided the objective data to say that the 64 wasn’t suitable for the next-gen Final Fantasy.

Final Fantasy characters on N64

Final Fantasy characters on N64

After Square joined Sony to partake in materializing their visions for Final Fantasy VII, the company had a major fallout with Nintendo.

Shinichiro Kajitani, VP, Square USA

When we made the decision to go with Sony, for about 10 years we basically weren’t allowed into Nintendo’s offices. From a consumer’s point of view, it was good to have two companies competing with each other because prices wouldn’t rise and it would be better for them. But from a business perspective, our main interest was making sure that Sony won and Nintendo lost, basically, because that would be better for us.

Yoshihiro Maruyama, Executive vice president, Square U.S

I don’t think [anyone from Nintendo gave us a hard time]. They said, “Oh, we don’t need that.” That’s what they said. [Laughs] Their philosophy has always been that Nintendo hardware is for their games, and if a publisher wants to publish, “OK you can do it.” But if you don’t like it, “We don’t want you.”

Hironobu Sakaguchi, Producer and executive vice president, Square Japan

When we made our decision, the president of Square [Masafumi Miyamoto], our lead programmer [Ken Narita] and I went to a meeting with Yamauchi-san. There is an old cultural tradition where, in Kyoto, someone will welcome you with tea, but you’re not supposed to really drink that tea. It’s just polite to have it there. And Yamauchi-san welcomed us with a very expensive bento meal and beer, and gave us a very nice welcome and basically patted us on the back to say, “I wish you the best.” No bitter feelings or anything.

But Hiroshi Kawai, character programmer, Square Japan, at the time heard things differently.

What I heard was Nintendo said, “If you’re leaving us, never come back.”

A remake of Final Fantasy VII is in progress. We’ll continue to keep you updated on its progress so stay tuned.


FilmGamesEtc Staff
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  • Andrew

    haha, Nintendo literally need to beg any dev that will listen to make games for them now. Everyone abandoned the Wii U and will almost for sure abandon the Switch after its first year or 2. Nintendo doesn’t appeal to the true gamer anymore who would pick their console to be their only console. Most Nintendo console owners now own it because they’re able to afford multiple consoles. I would have had to have been stoned out of my mind to buy a Wii U as my only source of gaming vs an XB1 or PS4.

  • Note5

    During the SNES days I remember Yamauchi despising RPGs saying gamers don’t want it and boom!!!! FFVII exploded!

  • fkf

    Nintendo is soooo 80/90 no one wants stupid Plumber anymore


    BOOOOM!.!.!. One company that won’t be on the “switch….!”

    To bad for Nintendo. I was personally vested in their new console until I heard of it being a “portable” console on the go kind of thing.

  • Johnny J

    Nobody cares what you have to say

  • Timesplitt

    For the North American release of the 1994 Super NES game, see Final Fantasy VI.

  • Nintendo Fan 4 Lif3

    It sounds to me like it’s not that they DIDN’T want to accommodate Squaresoft, but the fact that they would have had to delay the system by years instead of months; that they had done no kind of work at all prior to Squaresoft even telling them anything so even if they’d done as they said, they would have had to delay the console by a mile and take a lot of losses. Because the N64 without a doubt was very expensive at the time especially for cartridges so if they had to stack on CD ROM they probably would have taken major losses and risk takeover. So Nintendo being as stubborn as they are refused to sticking to their vision so that they could have a future instead of be beholden to other companies. It’s not Nintendo didn’t care at all about Squaresoft it’s just they probably blew through their R&D more and faster than they expected, underestimating the fact that cartridges were very limited at the time trying to reach for the stars so they could push it forward. Only to find they were way ahead of their time.

    And with the pride Nintendo has, they didn’t wanna admit to Squaresoft that they pretty much had made an error in judgment and that what they were asking for they couldn’t do without many sacrifices, so in their minds going forward taking the loss of bonds than the loss of money was the lesser of two evils so that they could stay afloat and be able to do something as they wanted, because they’d rather see it through to the end than ever admit they were in a conundrum. Especially because, as we know, Nintendo DOESN’T like any external help or influence erupting in their culture especially back then. Even now they’ve only acquired so many, rather few, second parties since the beginning of the new millennium, keeping a tight knit culture in the workplace.

    Because of this exact reason, they probably didn’t want to get any help from Squaresoft or anyone for that matter, afraid their internal culture would change and it’d stop being Nintendo. So ultimately in the end it was identity over unity. But hey I could be wrong things were different then. Hopefully soon enough they do a book about the whole story, this has only made me more curious. And who knows FF may return to Nintendo home consoles with the Switch. We’ll find out soon.

  • Note5

    Its just Nintendo being themselves – shrewed and screwed.

  • Nintendo Fan 4 Lif3

    Well that’s the basic and most obvious because Nintendo doesn’t listen to anyone; that much we know. But as we also know there’s always a story behind their games, and also their history with developers. Even if it turns out Nintendo just committed another cardinal sin that got them to this turning point, I’m still interested. They were very secretive back then so wonder what kind of surprises would be uncovered if people dug deeper. With the Switch reveal we saw that Square Enix is showing more support again, for now at least. So maybe tensions will heal in time and we may learn more. It’s not as interesting if it’s just because “Nintendo is Nintendo” gotta have a story for it to be worthwhile.

  • Barry Harden

    Nintendo still hasn’t learned to this day. I think the Wii success has retarded their thinking. Sure at the time it wasn’t the most powerful but unique. You can’t keep trying to recreate that party trick. At the end of the day the gaming fundamentals of performance and graphics will be the eye candy for consumers.

    Nintendo’s days are numbered.

  • xibx

    That’s what I thought too.

    But the Japs don’t care what other people think, specially this old-school corporate in particular. They believe they have their own market.
    Spent three years there to recognize this.

  • john

    They don’t ‘believe’ they have their own market – they actually do! This is how Nintendo has survived this long….they could live off their own market.

  • Note5

    I read this story about Yamauchi vs Namco and Sega during the Mega Drive days. Man that is bone chilling cold.

  • Note5

    Hiroshi Yamauchi was a very aggresive guy. Very shrewed.

  • Panty Sniffer

    good news for pantie sniffers

  • Mohammed Allha

    Nintendo just care about there first party games I mean if I were them I would do the same there games do very very good commercially but things changed what worked 10 or 20 years ago doesn’t mean it will work now

  • Mohammed Allha

    The will success is just because it was cheap very very cheap and at its time people were broke there was financial crisis everywhere so people would prefer to buy a wii cheap console instead of a ps3/x360 or at least that what I think

  • xibx

    You’re absolutely right, sir.

  • Nintendo Fan 4 Lif3

    Yeah that’s what I remember reading about the guy for the most part: the corporate culture changed a lot after Iwata had risen up in the ranks. Even before then though Nintendo’s culture was always tight knit even before they went into games so was only natural. And that’s the thing, that’s just who they were, the Yamauchi family had led Nintendo for generations so it wasn’t too uncommon for things like this to occur they had to keep their structure going. Makes me wonder who will lead Nintendo from here on since as far as public is concerned, Kimishima will only be a stand in for a bit longer with possibly once of Yamauchi’s descendants or someone else taking over.

    Which would start the vicious cycle all over again. So hope that doesn’t happen. Because now Nintendo’s more open than ever but yes doesn’t erase their past mistakes. I wonder if they’re taking that into accout going forward since again Square Enix is working with them more closely now. And it’s very striking that he was humble about the whole Squaresfot departure. I wonder if it was more a front he put up in public then and around the other employees and only those he worked with closely or had high respect for saw his true side.

    The other side being what the media knew of so that Nintendo keeps up appearances not coming off as slouches that gave in to anyone or so. I mean back then anyone could have taken over Nintendo possibly with how bad things got then during N64 and GameCube yet no one tried anything or so, kind of curious what went on behind the scenes back then on that front since there’s little to no history of anyone trying to take them over.

    Not that they were small, but that aggressive affront would be main reason for such an occurrence to be rare to nonexistent at all. I mean you never hear Yamauchi ever being necessarily a nice guy in any sense especially sending a business partner off to your competitor; I wonder what he really felt about Nintendo, if he just went with it because it was his job and he stuck around because of the passion of his other employees not because he cared anymore after Nintendo lost even more favor with the public eye afterwards especially in Japan.

  • Nintendo Fan 4 Lif3

    Yeah I know during Mega Drive especially it was very heated with Sega pulling in some more support and giving them competition but didn’t think anything stemmed back or that extensively on one particular company at that point. I never read that story I gotta check it out sometime. Though I’m also curious on the story behind Super Mario 64 and also the whole exchange with Rare to Microsoft which was one of the biggest blows, wonder if that was to mitigate any possible chance of them breaking them off also so just sold em probably hearing rumors in the company that they didn’t like Nintendo so much so had spies in their workplace confirming that most of the company held the consensus or didn’t like their practices so to prevent more publicity than needed used the guise of a business trade off to handle that.

    Though I’m sure they regret it now not being as open for that and other reasons such as with Namco during SNES when there was some censorship for Western markets. I imagine the most chilling story though has to be what happened when the Nintendo PlayStation didn’t happen. Which makes me even more curious if Square had any insight into that at the time that informed their decision. The workplace may have been tight knight but I’m sure that also encouraged the lobbying around of certain company secrets since Internet wasn’t as prominent back then that Square found some details that made them pity Sony and wanted to give them chance and get their revenge on Nintendo with them. Starting with FF VII so that Nintendo wouldn’t hold them back because the success was getting to their heads pretty much and everyone else but them saw that.

  • Sean Sharpe

    Squaresoft isn’t making games for anyone…

    Square Enix is making games for the Switch though. Like… three Dragon Quest games were already announced and they are making a smaller, retro-inspired RPG from the Bravely Default people.

  • Sean Sharpe

    RPGs were big on the SNES, too. Even back in the day, a lot of people bought a PS1 solely because that’s where Squaresoft was going to be releasing games now. I mean, yeah, the genre was “niche” before FFVII, but it was a pretty damn big niche.

  • Sean Sharpe

    I always have to roll my eyes at the whole comment of “Nintendo doesn’t appeal to *real* gamers!” Reeks of fanboyism.

    I mean, sure… I wouldn’t be happy if I just owned a Wii U, but a Wii U and 3DS? I’d be cool. Not that there’s not games I’d want to play… But likewise, if I just had my PS4 and nothing else I’d eventually want my Nintendo games.

    Since you know, real gamers aren’t console fanboys and like and play everything.

  • Andrew

    I also need to roll my eyes when people like you assume that because I criticize Nintendo I’m not a Nintendo customer and I must be a Microsoft or Sony “fanboy” as you put it. In reality I actually own ever console since the NES came out for all three major companies. I’ve spent tens of thousands of dollars on games and consoles in 20+ years of gaming which gives me the right to criticize any of these companies when they make poor and stupid decisions. I’ve pre ordered a Switch and I will criticize it until it proves me wrong and lasts more than 2 years with 3rd party support. I’m pretty confident based on what I’ve seen from this system so far though that I’ll win this battle as well. Nintendo is clueless now and they’ve shown us that by making incredibly bad mistakes for a second console in a row.

  • Sean Sharpe

    But why would you even purchase something that you don’t think you’ll be satisfied with? Why even bother with Nintendo platforms, since outside a handful of gems, they got absolutely garbage third support ever since the SNES died?

    I mean, I love the hell out my Wii U. But I didn’t buy it for anything other than Smash, Mario Kart, Bayonetta, and Wonderful 101, and Zelda (which I’m getting on the Switch, heh). I went in, expecting nothing other than those games… And I got quite a few other games I enjoyed.

    Maybe I just don’t get why people go into systems with huge expectations… I mean, if a system has about five games I’ll find worth while, I’ll buy it… And not expect anything else. Makes things I find more rewarding and doesn’t leave me disappointed because I set my sights higher that would be delivered.

  • Note5

    FFVII really made JRPG legit and mainstream.
    SNES’ FFVI, Chrono Trigger vs Sega’s Phantasy Star IV were just the build up before the explosion.

  • Note5

    Man I will dig it up again. And give you the link.
    But man according to that Namco going to Sega story Yamauchi looked like a tyranical Japanese feudal lord!
    Deeply rooted from that tradition. Namco suffered great humiliation from him.
    He ruled with an iron hand that really even made big pubs like Capcom and Konami very uneasy.

    I think they too did not want Nintendo to monopolize Japan and USA.

    I miss the old Capcom they were a real force to be reckoned with. Remember how they supported the Dreamcast against PS2?

  • Nintendo Fan 4 Lif3

    Will do look forward to reading it. Wow for real I knew the guy was serious but didn’t think he went that far. No wonder they were happy to move to Sony; with Squaresoft spurring on them courage to leave Nintendo and be able to get better start. And exactly because they didn’t want them to monopolize the biggest markets for them; if so it would have meant greater dominance for them and less publicity for publishers also if they wanted to get anything much for their games. Especially if Yamauchi wasn’t gonna change at all, it would be bad for business. So in that sense it also served greater good for rest of the developers who were able to find a haven with PlayStation and work around that and make Nintendo learn from…some of their mistakes. Can’t imagine how intense it got since the Japanese are usually more reserved and business like that it must have also been shock for names like Capcom and Konami how he acted when no one was looking through public eye makes me more curious.

    And yeah I was looking back on a list and especially with Marvel vs Capcom they pushed quite a bit of titles before the Dreamcast was dscontinued, pushing more software so that people had variety on it. And even after that once they came out with DMC and Onimusha among other titles for Sony they gained a bigger presence trying to push more content so more could push content. You could say it’s because Xbox joined taking Dreamcast’s place that there were no longer 3 direct competitors across all the markets and that lessened need for competition. Which made developers lag behind in Japan with technology thinking it’d be more simple that way only to find when Sony jumped to HD that lotta them had hard time adjusting not just because of the CELL processor and HD era dawning but…..just getting comfortable with the environment.

    Not challenging themselves more to wanna do more and go outside that comfort zone to channel that creativity. Which I think is part of the reason why Yamauchi was so strict because he was probably afraid of this kind of future where Japanese developers began to have a lethargic attitude not doing much outside of what they do now stuck in tradition and maintained their infrastructure to enforce more effort from employees and challenge them. Same for third parties believing pressure would force them to do more and try to stay on top of their game when it only made them do the opposite and feel grabbed by their throats every second fearing their own future than respecting position as head of the company.

    Berating them instead of praising them thinking they’d fear failure so they’d never wanna lag behind when that in itself made Nintendo lag behind and become closed minded, as they’d always done things more independently never looking outside their own comfort zone to change things and adapt that they’d always lead charge for change in the landscape. Underestimating the power of non publisher devs to influence landscape and push it forward, which was what happened with Squaresoft. Because Nintendo had a god complex thinking they’d lead everyone in the right direction thinking they could do no wrong when fact of the matter is they did the people who got them that far only focusing on the general public and if they had the cash flow rolling in.

    Never paying respect to the ones who helped them get that far even though they demanded just as much respect if not more. Henceforth devs had lost motivation to wanna do more; so essentially Sony saved the day because if not for that, I’m sure many devs would have quit game development by then; barring any ties to Sega since Sega was already having issues at that point with the Saturn and whatnot and Mega Drive more expensive I believe. The consequence of that being though was devs became again too comfortable in their environment that only now are we seeing more devs do stuff differently in past few years so they expand their horizons especially on technology with Square Enix using Unreal Engine 4 now besides in house tech, which is something still many Japanese devs need to do, even if others like Atlus will use it also for SMT on the Switch. All in all, Nintendo’s past caught up to them and they couldn’t maintain their streak which also stagnated other companies who wanted to do more but couldn’t, especially because of the cancelled SNES CD. It all comes full circle.

  • Note5

    Here is an excerpt from the book “Game Over” about Nintendo vs Namco

  • Note5

    Did you notice that Nintendo and Sony basically still have the same principles from the old days and even today?

    Nintendo: We make hardware for Nintendo games first then third party partners. First party games are the biggest sellers.

    PlayStation: We make hardware for third party partners first then first party.
    Third party games are the biggest sellers.

    Pretty much the same old game.

  • Barry Harden

    Sure it was a combination of having something unique(motion controls) and being cheap which shows in the poor graphics compared to the Xb360 and PS3.


    You do realize that square enix is squaresoft….? Called an acquisition that helped save square as a whole from bankruptcy.

  • Sean Sharpe

    Yes. I’m well aware of that.

    But considering your response was snarky and wrong (since SE is making games for the Switch) I figured I’d respond, tongue-in-cheek. Although I’d argue, for the most part, the Square side of Square Enix is dead and gone… But that’s just because they haven’t seemed to care about anything that isn’t Final Fantasy for well over a decade.



  • Nintendo Fan 4 Lif3

    WOW. I had no idea that Namco suffered THAT much humiliation takes a lot of courage for the head of Namco to even be able to stand tall after dealing with Yamauchi back then. Can’t believe things went like that; though it’d be no surprise if even Capcom among others had shared that same sentiment back then and why it was relief for most of them to move over to Playstation. It’s a miracle tbh that no sources were leaked directly back then, even if Internet wasn’t as prominent, as things still were kept on a tight schedule and under cover. Not to mention fact that especially Nintendo was involved hard to believe anyone got any information without getting caught though I guess that goes to say developers and people back then were more cunning with information gathering as today well…..Internet tells you nearly everything that you don’t have to search every nook and cranny. But yeah this has me even more interested, wanna buy “Game Over” and see more about it for myself. Are many even aware of the book?

  • Nintendo Fan 4 Lif3

    Yeah I noticed the structure is more or less the same for Nintendo and Sony especially if they wanna keep competition up and running. They’ve evolved overtime doing things slightly different but mostly follow the same principles so they each preserve their identity. Though I imagine like in all game development, Nintendo and Sony have…..for lack of better phrase gotten tired of the tug and pull in this same old game, and have probably been thinking of something different for a long time now. Maybe collaborating again, coming together to do something after more than twenty years when the first attempt didn’t work.

    The thing about that is, without Nintendo we wouldn’t even have the Playstation tbh and that’s a largely unknown fact that escapes many people, because majority of gamers never knew what SNES CD was or never will. Even if Sony was the one who ultimately took initiative and made it themselves with the genius of Ken Kutaragi so they would even be able to have it out. That’s another story I hope somebody goes in depth on than just “Nintendo was over them so left them in the dust to continue cartridges” and whatnot.

    There’s the whole thing with what goes around, comes back around. Square Enix eventually started developing for Nintendo again, as did many devs no matter how big or small the contribution. Makes me curious if at some point that Nintendo will need Playstation this time and wanna develop something together now that there are bit more open minded than way back then.

    Make a system that could support some older games but also bring together what makes Sony and Nintendo what they are into one package. I’ve honestly wanted to see an all in one console for a long time be exciting to see how that would come about. I know it’s easier said than done especially for the Japanese to put aside their differences but doesn’t mean it’ll never happen. Maybe there will be a hybrid system that supports cartridges and discs so that people get best of both worlds and can have more games to choose from.

    They’d both still have big competition: Microsoft. All out war of who’s better: American or Japanese culture. I don’t see why it could never happen. Cartridges have gotten cheaper to make games for, discs support more storage, I imagine it’s crossed Nintendo and Sony’s mind to have some kind of hybrid console. Watch them both announce after start of next decade that something is coming from them both. Highly unlikely indeed but prospects are exciting the dream union of them will come true after so many years on hold. Doubt they’d let each other absorb one another so could be that they use a special new name and all than Playstation for it.

    But yeah I doubt that the competition will remain like this for another twenty years or so, something’s gotta give. Either a new player comes in that the current Top 3 merge in some capacity or one of them exits then it stagnates for a while. Nothing will remain stable like this, especially with both Sony and Nintendo losing money. Not to mention Microsoft who just lost Scalebound as their exclusive. Which reminds me: who do you think will get the game Sony or Nintendo, should Platinum resurrect it?

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