Japanese Video games are one aspect of Japan's culture that has meshed flawlessly with American  culture.  Although video games were not invented in Japan, they have become a huge part of popular culture.

Throughout the period of ATARI's success, no home video games were made in Japan, and only Nintendo was making arcade games exclusive to Japan,

No home video Games were manufactured in Japan until introduction of Nintendo's new system, the famicon (renamed NES "Nintendo Entertainment System" in America.  The system debuted with "Super Mario Brothers in 1983.

NES revamped a fad that seemed to be disappearing with the downfall of ATARI.  Following quickly, American and Japanese manufactured Sega attempts to compete by releasing Genesis, which has limited success.

Nintendo enjoyed their domination in the video game world until Sony, another Japanese company, invented the playstation in 1995.  Nintendo responded with the Nintendo 64 and the video game industry took off.

Today the production of Video game systems and hardware is a huge part of Japan's economy bringing in over 1,300 billion yen per year.  The current Nintendo system, Wii, is hugely popular in American culture and is considered to be the video game system of the future.

Home systems, however, are not nearly as popular in Japan as America.  Japanese gamers are moving towards more hand held systems, such as the Nintendo DS and Playstation PSP, that appeal more to the Japanese "on-the-go" lifestyle.  Styles of games popular in Japan also tend to be more orreinted towards RPG (role-playing-games) rather than shooters as here in the United States.  Other styles of video games that are popular are those borrowing characters or themes form manga or anime.  Cell phone games are also hugely popular in Japan.

Arcade style games are still monumental in Japan while they seem to be a relict of the past in the United States.  Arcades in Japan can by very large, multiple story buildings with each floor categorized by game type.  Games such as Dance Dance Revolution and Drum Master are also becoming vastly popular in Japan.  These games may be situated outside of the arcades on sidewalks, where players can practice in order to show off their skills in front of the large audiences that gather.

From Newsweek:

"There are 9,500 arcades in the country with more than 445,000 game machines made by Japanese companies like Namco and Capcom, says Masumi Akagi, publisher of Japan’s Game Publisher magazine. In the U.S. of course, the story is much different–arcades are a rapidly dying breed with only about 3,000 in operation down from 10,000 a decade ago.” … “So this is what we are missing in America, with our arcades abandoned by the big entertainment and game companies and converted into Baby Gaps. Japan’s “quarter kids” have grown up and are still having fun…"  

The future of video games is certain to be both competitive and bizarre.  Most likely video game manufacturers will focus on making systems smaller and with better graphics, and arcade games will continue to be high priority in Japan.