Capcom Was on Its Knees After Resident Evil 6 – Here’s How it Turned it Around

With Monster Hunter Wilds breaking Steam records and Resident Evil more popular than ever thanks to Village and a handful of stellar remakes, it’s almost as if Capcom is incapable of failure. But that wasn’t always the case. Less than a decade ago, after a string of critical and commercial flops, Capcom was on its knees. It had lost its way and its audience.

Capcom was suffering from an identity crisis. Resident Evil, which established the survival horror genre, had lost its bite after Resident Evil 4. Another big hitter, Street Fighter, was on the ropes after the poorly-received Street Fighter 5. It could easily have been the critical end of Capcom and its much-loved games.

But in the darkness, there was light. A change in the way Capcom made its games, supported by a powerful new game engine, gave these much-loved series a new lease of life, and kickstarted years of critical and financial success that catapulted Capcom back into the big league.

Resident Evil Lost Its Way

2016 was a bad year for Capcom.

The big Resident Evil game released that year was Umbrella Corps, an online co-op shooter that was pummeled by reviewers and fans alike. Meanwhile, Street Fighter 5 was met by a collective eyebrow raise from longtime fans who could hardly believe this lackluster fighting game was the sequel to the brilliant Street Fighter 4. And Dead Rising 4, which featured the long-awaited return of beloved photojournalist Frank West, would end up being the series’ final new entry.

This was the low ebb of a string of forgettable years Capcom had endured since 2010. The mainline Resident Evil games were met with diminishing critical reception despite strong sales. Street Fighter was on the ropes thanks to a poorly received new entry, and Capcom mainstays like Devil May Cry were nowhere to be seen. Meanwhile, the company’s most popular and successful franchise at the time, Monster Hunter, was huge in Japan but struggled breaking into international markets.

All of this is a far cry from the Capcom we know today. Since 2017, Capcom has been one of the few major development studios that has rarely missed a beat. The Osaka-based company has released a stream of hit games from its most famous franchises, racking up both sales and accolades. We’re talking about a run of releases that includes Monster Hunter World, Devil May Cry 5, Street Fighter 6, and a trio of industry-leading remakes plus an acclaimed soft reboot of the Resident Evil series. In short: lately, Capcom seems incapable of failure. .

Achieving this success took more than simply learning from mistakes. Capcom had to re-think its entire strategy, from the type of players it targeted to the technology it used, to make such a turnaround possible. To learn more about this seismic shift, IGN sat down with four of Capcom’s leading creatives to find out how one of gaming’s most successful gaming companies tripped, fell, and picked itself up better than ever.

Capcom was founded in 1979 as a maker of electronic game machines, or “capsule computers”. It rose to ascendency during the 80s and 90s thanks to 2D games like Street Fighter and Mega Man, and then made the all-important jump to 3D with games like Resident Evil. Between 2000 and 2010 Capcom successfully transitioned many of its big, golden-era franchises into the modern age, a process that gave birth to one of the greatest games of all time: Resident Evil 4.

2005’s Resident Evil 4 is considered by many to be a generational high point thanks to its ingenious mix of horror and action. But that mix altered the course of the Resident Evil franchise dramatically. At its core, Resident Evil 4 is a horror game, inspired by the likes of Friday the 13th, H.P. Lovecraft, and the works of John Carpenter. But sprinkled between the strands of its horror DNA are tremendously effective moments of Hollywood action cinema.

Unfortunately, this ideal balance between horror and action was lost in subsequent games. In 2009’s Resident Evil 5, hero Chris Redfield punches a car-sized boulder with his bare fists, and infected enemies are gunned down in a car-chase sequence that’s more Fast and Furious than frightening. The series was losing its identity and this was clear to both players and the developers like Resident Evil 4 remake director Yasuhiro Ampo who’s been working on Resident Evil games since 1996.

“Overall throughout the Resident Evil series, we set up different goals, challenges, and things we want to try with each game… But this time, many of us started feeling that what the fans and players wanted from the series was getting a little bit separate from what we were making,” Ampo says.

This directional confusion would result in games like 2012’s Resident Evil 6, a game that tried to have its cake and eat it too. In order to please both action and horror fans, Resident Evil 6 split the game between six playable characters and three unique storylines. Each section catered to either horror or action fans, and so never achieved that all-important balance of both genres, which ultimately left nobody truly satisfied. Disgruntled fans shared their disappointment in these new, action-packed Resident Evil games online, while the developers continued experimenting with spinoffs that ventured into new territory like online co-op.

This downward trend was not exclusive to Capcom’s survival horror series, though. Not so long after the release of Resident Evil 4, the company’s Street Fighter team was also flying high. Street Fighter 4 was an instant hit thanks to its unique art-style and great cast of new and returning characters. It became an immediate hit at fighting game tournaments and in college dorms alike.But, like with Resident Evil, Capcom failed to match those highs with a sequel. Compared to its imaginative and full-fledged predecessor, 2016’s Street Fighter 5 was criticized for releasing barebones with hardly any single player content, as well as its abysmal online functionality. Fans cite a clear lack of polish and a confusing philosophy towards balance that made the overall experience just plain frustrating.

But it wasn’t just Street Fighter and Resident Evil that were struggling. Almost every key franchise struggled to make a mark. Devil May Cry, the studio’s popular, heavy-metal action game was seeing diminishing returns to the point where Capcom outsourced the next game in the series, 2013’s DmC: Devil May Cry, to UK-based studio Ninja Theory. While it’s gone on to become something of a cult title, DmC’s fresh take on the series’ mythology, redesigned protagonist, and sluggish 30fps frame rate was met with vitriol from online fans. Perhaps unsurprisingly, after such a muted reception the series was shelved until further notice.

This slate of misfortunes defines the Capcom of the early to mid-2010s. Key franchises struggled to replicate the successes of the past, while other titles were put in cold storage. New games attempting to capture the western market, like Lost Planet and Asura’s Wrath, also failed to land with audiences. There was the odd bright spot, like Dragon’s Dogma, the new dark fantasy RPG from Devil May Cry director Hideaki Itsuno, but for the most part Capcom’s focus was all over the place.

It was clear something needed to change.

Street Fighter 5, The Lost Cause

By the mid-2010s Capcom had begun to enact a number of strategy-shifting changes that would totally transform the company’s fate. Such changes had to begin small, and so the first matter of business was putting out the existing fires. Street Fighter 5 needed to be fixed. And so Capcom enlisted director Takayuki Nakayama and producer Shuhei Matsumoto to help steer the troubled game towards stability.

While neither were there from the ground floor of Street Fighter 5’s development, and therefore can’t detail why Street Fighter 5 was released in the state it was, the duo inherited a game that greatly needed some substantial fixes in order to regain the trust of fans.

“There definitely were some challenges within the production of the game, and that was part of the reason why I was brought into the team,” Nakayama admits. “And because we were in a point in development where we couldn’t really make any major pivots or shifts, we had to proceed and move forward in the direction we were currently in, which created constraints on what we could and couldn’t do.”

Those constraints severely limited the scope of what the pair could achieve. And so rather than transform Street Fighter 5 into a S-tier game, much of the work Nakayama did was fixing the game’s most pressing problems and biding his time until work could begin on Street Fighter 6.

“We just didn’t really have enough time to address some of the problems and challenges we faced in Street Fighter V,” Nakayama says. “And so, with our hands tied behind our backs, we basically had to wait for those ideas to be brought back for the initial conceptual phases for Street Fighter 6, so we could tackle and do things properly for the next title.”

All this considered, why did Capcom not just end Street Fighter 5’s development and begin working right away on a sequel? If it was such a weight around the necks of the developers, couldn’t they just start from scratch? According to Matsumoto, abandoning Street Fighter 5 just wasn’t in the cards. “There wasn’t any sort of sense of like, ‘Okay let’s just end Street Fighter 5 and focus on Street Fighter 6.’ It was more like, while we were working on Street Fighter V, we were trying to figure out what we really wanted to do in Street Fighter 6 content-wise,” he says.

“Basically, we tried different things during the development of Street Fighter 5 to see if it worked and then we took the things that did work and applied that to Street Fighter 6. It was like the development of Street Fighter V was an ongoing process that helped us figure out, ‘Okay, what is it that we want to do for the next level?”

The team treated Street Fighter 5 as a lab where they could learn from their design mistakes and figure out what to do differently for the sequel. The years-long process required careful consideration of the game’s every core aspect, which informed several important changes . There were numerous updates, starting with the fundamentals like steady improvements to the netcode and character re-balances, and progressing all the way up to new characters, V-Triggers, and even entire new mechanics like V-Shift, a new defensive move that provided a brief window of invincibility that the devs were considering introducing in Street Fighter 6 but decided to test in Street Fighter 5.

There was a much larger goal for all these improvements beyond just elevating the game to an acceptable level, though. Capcom was on a mission to rediscover the fun. At the end of the day, fighting games should be enjoyable to play, but Street Fighter 5 had become a somewhat frustrating discipline to master.

“We both realized that fighting games are fun, and when you get used to them, it becomes more enjoyable and something you can essentially play forever as long as you have an opponent to play against,” Matsumoto says. “However, one of the challenges that we faced with Street Fighter V is that we felt that there wasn’t a clear pathway that helped guide players to get to that level where they finally feel like they’re having fun and will want to continue playing.”

Street Fighter had previously tried to be more approachable by lowering the difficulty, but this only served to turn off longtime fans. Instead, Street Fighter 6’s approach was to expand the tools available to new players while giving experienced fans everything they already loved about the series.

While they could have cut their losses on Street Fighter 5 and immediately tried to win fans back with a sequel, Nakayama and Masuhiro knew that this would be a shortcut that didn’t grow Street Fighter in any meaningful way. But by sticking with Street Fighter 5 and using it as a testbed for new ideas, 2023’s Street Fighter 6 was able to launch as one of the most critically-acclaimed games in the entire franchise.

While Matsumoto and Nakayama were able to take the work put into Street Fighter 5 Arcade Edition and apply the lessons they learned to Street Fighter 6, it was important that Capcom did not repeat these kinds of situations and be forced into having to overhaul games again. A significant shift in strategy was needed that would prevent such a disaster ever happening. And that’s where a couple of vital behind-the-scenes changes came into play.

Monster Hunter Took Over The World

Around the time of Street Fighter 5’s launch in 2016, Capcom underwent an internal reorganization in order to prepare for a new generation of games. These games would run on the company’s brand new RE Engine, a replacement for Capcom’s ageing MT Framework. But this change was about more than just tools. Alongside the engine upgrade came a new mandate to ensure Capcom’s games were being made not just for existing, territory-specific fans, but for a global audience.

“It was a few factors that came together,” says Hideaki Itsuno, a former game director at Capcom best known for his work on Devil May Cry. “The change of the engine and also all teams were given a very clear goal at that point to make games that reach the global market. [Games] that are fun for everyone.”

If you look at almost all of Capcom’s games released during the PS3 and Xbox 360 era, you get the feeling that the company was going all-in on trying to capture an imagined version of the “Western games market.” The action-heavy Resident Evil 4 was a big hit, true. But the more gun-focused spinoffs like Umbrella Corps, as well as the sci-fi shooter series Lost Planet, were all clearly chasing late-2000s Western gaming trends to no avail. After several years, Capcom realized it needed to create games that could appeal to everyone, not just fans of traditional Western genres.

“I think that we had that clear goal of just focusing and not holding anything back,” Itsuno says. “Towards making good games that would reach people from all over the world.”

Itsuno notes that the time leading up to 2017 was pivotal. “The changes in organization and the changes in the engine, all these elements came together around that time,” he says. When Resident Evil 7 launched that year, it kickstarted a Capcom renaissance.

No other series embodies this new company goal for global success better than Monster Hunter. While it had its diehard fans in the West, for decades Monster Hunter was much, much bigger in Japan than the rest of the world. The series was never conceived to be something that was only big in Japan, but there were real-world factors as to why this happened.

Firstly, Monster Hunter found tremendous success moving from PlayStation 2 to the PSP with Monster Hunter Freedom Unite. The handheld gaming market has always been much stronger in Japan than in the West, as seen with the success of not just the PSP but also Nintendo’s DS and, more recently, the Switch.The popularity of handhelds in Japan is rooted in a number of factors, but the thing that really worked for Monster Hunter, according to the series’ executive producer Ryozo Tsujimoto, was that Japanese gamers were able to reliably play with friends thanks to the widespread adoption of mobile consoles.

“20 years ago in Japan, having a network connection wasn’t as easy, and there weren’t a huge amount of people playing Monster Hunter online. However, handheld consoles made multiplayer gameplay easy without internet access, and I regard it as a great success that we had players experience the game in this way, which was one of the ways we really wished for them to play and enjoy it, even in that era when online gameplay wasn’t easy.”

Monster Hunter, which is built on a core pillar of cooperative play, recognized that this aspect would best be served when friends could quickly jump into hunts together. There was no better avenue for that at the time than handheld consoles. Thanks to Japan’s mobile games market, it meant Monster Hunter was being developed for a local market first, even if that wasn’t an intentional approach.

This created a loop of sorts. Monster Hunter games would become best-sellers primarily in Japan, and to keep pace with the audience, Capcom would release Japan-only content and host Japan-only special events, further reinforcing Monster Hunter as a “Japan-only” brand.

But the reality was that Monster Hunter did have fans in the west, and they were enviously looking from the outside in as Japanese players received exclusive tie-ins and quests. But as the Western world improved its internet infrastructure and online play became practically mandatory for most console gamers, Tsujimoto and the team saw an opportunity to launch their most advanced and most globally-accessible Monster Hunter game to date.

Released in 2018 on PlayStation 4, Xbox One, and PC, Monster Hunter: World was a gigantic change for the franchise. Rather than being scoped for small, less-capable handheld consoles, it delivered large-scale, AAA console quality action with souped up graphics, bigger areas, and, of course, bigger monsters.

“Our approach to the globalization of the series and Monster Hunter in general really ties into not only the themes that we had going into designing the game, but also in the name of the game,” Tsujimoto reveals. “The fact that we called it Monster Hunter: World is really kind of a nod to the fact that we wanted to appeal to this worldwide audience that we wanted to really dig into and experience Monster Hunter for the first time.”

It was also vital that Monster Hunter: World not do anything that gave off the impression that Capcom was prioritizing one market over the other. Monster Hunter: World would be released simultaneously worldwide, and there wouldn’t be exclusive content locked to Japan, something Tsujimoto says “comes with realigning ourselves to hit those global standards that people come to expect of titles around the world.”

It wasn’t just a matter of making sure other regions got Monster Hunter: World at the same time as Japan (though it certainly helped). Tsujimoto and co. drilled deep to see what other ways Monster Hunter’s formula could be tweaked to broaden its appeal with players from all around the world.

“For World, we conducted focus tests across the world, and some of the feedback and opinions that we got during that process really affected how we designed our game systems and impacted how much success we had globally,” Tsujimoto says.

One important change that resulted from these playtests was simply showing damage numbers when players hit the monsters. Little tweaks here and there to an already successful formula drove Monster Hunter to the greatest heights it had ever reached. Previous Monster Hunter games had typically sold around 1.3 to 5 million copies, not including re-releases and special editions. Monster Hunter: World and its 2022 follow-up, Monster Hunter Rise, both recorded sales greater than 20 million copies.

This explosion of player growth didn’t happen by accident. Instead of changing the spirit of Monster Hunter to suit Western tastes, Tsujimoto and the team found ways to open up the series’ unique (and, admittedly, obtuse) nature to a wider audience without making sacrifices. This approach continues with the series’ latest game, Monster Hunter Wilds.

“At its heart, Monster Hunter really is an action game, and that sense of accomplishment you get from really mastering that action is an important aspect of Monster Hunter,” Tsujimoto explains. “But for newer players, it’s really about getting to that point. The steps involved in getting to that sense of accomplishment is what we’re trying to strategize for, in terms of designing for new players. So with World and Rise, for example, we were taking great care to analyze where players got stuck, what was hard to understand, what they were having trouble with, getting player feedback, and also doing our own kind of research into that. And all of that kind of knowledge has impacted how we’ve implemented new systems into Wilds.”

Resident Evil 7 Began Turning Things Around

Monster Hunter had a winning formula.The challenge Capcom faced was finding ways to convince global audiences to give it a shot. But it was not such a straightforward task for every series in the company’s portfolio. When it came to Resident Evil, the development team had to decide which of the series’ intertwined formulas was a winner; gory action or survival horror. Ultimately it was Resident Evil executive producer Jun Takeuchi who made the call.

“It was around the time I was working on Resident Evil Revelations 1 and 2. I was trying to test different things, try different approaches,” recalls Resident Evil 2 and 4 Remake director Yasuhiro Ampo recalls. “And around this time is when the R&D teams were divided into R&D division one and two. The executive producer of the Resident Evil series, Jun Takeuchi, took command of R&D division one, and he set the core direction that the Resident Evil series needed to go back to its origins, to its roots.”

Takeuchi ruled that Resident Evil must focus on survival horror as its guiding light. This proved to be the right decision. Resident Evil 7 was announced at PlayStation’s E3 2016 conference with a moody trailer shot in first-person, showing the insides of a dilapidated house. I was there in attendance when the Roman numeral for seven appeared, followed by the title Resident Evil. The convention hall roared in excitement.

There were, of course, questions about how Resident Evil could make the jump to first-person. By that point, third-person, over-the-shoulder gunplay had become synonymous with the series. It turns out, however, that in exchange for moving to a first-person perspective, Resident Evil regained something it had lost: It became scary again.

“With Resident Evil 7, the executive producer, Jun Takeuchi, made it clear that we cannot underestimate how critical it is for the series for it to be scary and about survival. So he made it clear that Resident Evil 7 would go back to its origins, it would be very cautious with its survival elements. And with that as a basis, then we would try new and different things,” Ampo says.

The game was a hit. While maybe not quite operating on the same level as Resident Evil 4, this significant shift in direction allowed for a welcome return to survival horror. Thanks to its unsettling and claustrophobic southern gothic setting, Resident Evil 7 ranks as one of the scariest games in the entire series.

But Capcom wasn’t going to abandon the third-person perspective that was so key to the series’ DNA. While new mainline titles like Resident Evil 7 and 8 would stay in first-person, Capcom planned to release third-person games through a series of brand-new remakes, starting with Resident Evil 2. Capcom realized there was a demand for remakes thanks to the appearance of several fan projects at the time.

“It was like, ‘all right people really want this to happen.’ So producer [Yoshiaki] Hirabayashi came up with the slogan: ‘Well, we’ll do it,’” Ampo reveals.

The result is one of the best games in the entire series. The Resident Evil 2 remake is a perfect blend of horror, combining all the action and puzzles fans have come to expect from the series with a new menacing Tyrant system that allows the hulking Mr. X to continuously stalk you throughout the Raccoon City police station. Under Ampo’s direction, Resident Evil 2 Remake became the second best-selling Resident Evil game in the franchise’s history.

Naturally, Capcom would follow up its incredible success with a remake of Resident Evil 3, another PlayStation 1 game that could clearly benefit from a modern reinvention. But, following that, surely Capcom wouldn’t remake Resident Evil 4 – a game that still felt refreshingly modern despite being almost 20 years old. Why touch something many considered to be almost perfect?

Ampo reveals that there was some hesitation to tackle Resident Evil 4 for sure. “As you mentioned, [Resident Evil 4] was still a title that enjoyed some popularity. So there was a lot of internal discussion on how maybe it’s not a good idea. Maybe we don’t need a remake for Resident Evil 4, especially because Resident Evil 4 is a game that is so beloved. If we get anything wrong with the remake, people might be quite vocal about their discomfort.”

But despite any initial hesitation, the team pushed through with a remake and the results speak for themselves. Resident Evil 4 Remake was another bonafide hit. Much of its success comes down to the biggest changes, which were focused on fine-tuning the action-horror ratio to achieve Takeuchi’s goal of keeping the series true to its survival horror roots. And so gone were some of the original game’s campier elements, replaced by a moodier, darker tone that still kept the heart-pounding action hero moments.

Around the same time as Resident Evil’s rediscovery of its horror core, longtime Devil May Cry director, Hideaki Itsuno, had a similar epiphany. After a brief sojourn into the RPG world with Dragon’s Dogma, Itsuno watched as the action genre began to soften in order to appeal to a more casual audience. And so when the chance to direct Devil May Cry 5 arrived, Itsuno saw an opportunity to challenge the audience of a genre he felt was in need of a good kick in the ass. He would do so in spectacular fashion, achieved by leveraging the company’s most powerful game engine to date.

The Reason Behind The Change

“I felt like the main trend with action games was to make action games that were very kind,” Itsuno admits. “Maybe, for me, a little bit too kind to the players, lending a hand to the player too much to my liking.”

Itsuno took over director duties on Devil May Cry starting with the second game in the series, and has since helmed every new iteration, save for Ninja Theory’s DmC. Following the release of Devil May Cry 4 in 2008, it would be almost 11 years before Itsuno directed another Devil May Cry game. But when he did finally return, he would oversee one of the most critically and financially successful games in the entire franchise.

The 10 years away from the franchise gave Itsuno time to figure out where he wanted to take the series. And more importantly he would return with a new arsenal of tech. “Technology-wise, there were not just little improvements that you would have when you work on a series consecutively,” Itsuno says. “When there’s a wide timeframe, [the technology] changes significantly.”

This vision coincided with the launch of Capcom’s new RE Engine. It’s the engine that most of Capcom’s games run on today. Replacing the old MT Framework that had powered everything from Dead Rising to Monster Hunter World, the major upshot of the RE Engine was its handling of photorealistic assets. This gave Capcom’s development teams access to higher levels of visual fidelity than ever before. It was also much nimbler than its predecessor, making it easier to implement changes if something wasn’t working as it should.

Ampo tells me the origins of the RE Engine thus, “So the original concept for the RE Engine was to allow for a development environment that was less stressful and could help us to make things quicker. Because it’s an internally developed engine, when we needed any additional tools, well, we could ask for them internally. They could be fixed somewhat quickly, internally, and also iterated on.”

This meant Capcom’s developers could also trial-and-error development choices on the fly. This proved vital for Itsuno, whose goal was to make the “coolest” action game of all time. That meant a lot of trial-and-error to make sure everything from the way the game looked to the way it played was as slick and stylish as possible. The RE Engine’s combination of rapid development tools and photorealistic capabilities meant Itsuno was able to increase the pure style of Devil May Cry by magnitudes.

“Devil May Cry is a franchise that stands on being cool,” Itsuno says. “That’s what the franchise is, it’s about being cool. Ever since I took over the series from Devil May Cry 3, I put everything that I, as a person, I considered throughout my life to be cool. Anything I’ve seen on TV, in movies, and comics I’ve read, any sport experiences I’ve had, I try to distill everything that I think is cool into what the game is.”

A New Capcom Golden Age

Since 2017, Capcom has released a game of the year contender on a nearly annual basis. In a time when major studios are struggling to find consistency, Capcom’s winning streak of 10 critically acclaimed games in less than a decade is a major outlier. That trend only looks to continue with Monster Hunter Wilds.

Focusing on a central goal of creating globally appealing games, all built with a technologically advanced engine capable of powering a multitude of different genres, proved to be a formula for unprecedented success. The Capcom of today is able to elegantly switch from laser-focused fighting games to tight survival horror to sprawling open-world action RPGs without missing a beat.

But what’s more impressive is that Capcom’s mission of making global, mainstream games did not dilute its games in the slightest. Instead, Capcom appears to have found the ultimate balance of keeping its games true to themselves — whether that’s the pure survival horror of Resident Evil, competitive spirit of Street Fighter, or the unique battle systems of Monster Hunter — all while expanding the audience for these games by millions.

Many of Capcom’s contemporaries are now finding themselves where Capcom was just a decade ago — fruitlessly chasing trends and losing sight of their identities. But for Capcom, the changes it made over the past decade has resulted in a new golden age that shows no sign of slowing down. Capcom may have fallen, but it has risen up better than ever.

When asked if they believe this is a new Capcom Golden Age, the directors largely agreed. Street Fighter’s Nakayama tells me, “It’s a very exciting time to be at Capcom right now. A lot of us are able to get excited about what we’re working on and are able to focus on things that we think are fun. So, yes, I guess a golden age may be one interpretation of that.”

Monster Hunter’s Tsujimoto put it more plainly: “Capcom is going through a golden era, and, well, now we have to do everything we can so that this lasts one more year, one more year, and every year, one more year. Hopefully we can extend it as long as we can.”

Matt Kim is IGN’s Senior Features Editor.