Square Enix, developer of the hit console RPG series final fantasy, has issued a statement that said it has reached an agreement with Epic Games to license the Unreal 3 engine (Gears of War) for its next gen titles. This is rather surprising for Square Enix, which has relied on its proprietary engines to fuel its games.

Square Enix said that it will not drop its own development efforts, but will use third party solutions such as the Unreal 3 engine to "ensure both game quality and development efficiency for next-generation game systems including consoles, PCs and network titles."

Taku Murata, general manager, research and development division at Square Enix, expanded on Square's decision to use Unreal Engine 3. "The complexity of next-generation game systems featuring HD graphics and multi-core parallel processing poses a number of technological challenges to our game development," Murata said. "However, we can expedite our game development process significantly while allowing extra time and resources to be spent on game design and mechanics by establishing an effective technology platform... I'm excited to be partnering with Epic Games in such an important area."

"We're extremely excited to be working with Square Enix," said Epic Games' vice president, Jay Wilbur. "Square Enix is one of the biggest and most influential companies in the worldwide game business, and having them work with Unreal Engine 3 is a major honor for us and something we're very proud to be announcing."

No specific titles were mentioned in the press release, but it is likely the first Square Enix title to utilize the Unreal Engine would come no earlier than 2008. [IGN]

Will we ever see a Final Fantasy running on the new graphics engine? My guess is no. I'm betting that Square is branching out with new franchises although the Unreal 3 Engine will definitely make for some serious graphical achievements given the talent at Square Enix. I'm just hoping that the gameplay doesn't suck...