SEGA is not leaving the console market

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I just want to take this time to tell you guys the truth, not the half truths and not some clickbait articles that mainstream media have been passing around. I usually ignore this talk of ‘SEGA is dead’ or ‘SEGA is going out of business’ because this has been talked about in the mainstream media since the late-90’s and I just assumed  we were over these types of things. We are on the internet, I assumed someone would have pointed out fabrications if there where any and it seems not many have.

So is SEGA going to stop supporting consoles with games? The answer is: No. Here is what the statement from SEGA-Sammy said:

Local organizations managing packaged game software in Western markets will be streamlined. In the U.S. Sega of America Inc. based in San Francisco will be relocated to Southern California by this summer and its existing office in San Francisco will be closed, thereafter, which results in reducing fixed expenses, mainly in corporate functions. 

SEGA has stated that they want to focus more on digital games and PC due to the area having a bigger profit margin and considering there are over a 125 million active users on Steam and a billion plus market on phones, do you really blame them? Focusing on digital titles doesn’t mean that they aren’t making console ‘packaged software’. Nowhere in their press release did it say they were going to stop making console titles. If anything, they literally announced that they were bringing Dengeki Bunko: Fighting Climax to the West two days prior to this restructure announcement and a bit before that they announced Hatsune Miku: Project Mirai DX for 3DS.

Hey, but if that wasn’t enough, a few days ago Sonic Team’s Takashi Iizuka re-confirmed via interview with the Japanese site 4Gamer that Sonic the Hedgehog wasn’t leaving the console market:

“Personally, I don’t plan to stop Sonic for home-video game consoles. Don’t worry about them! And enjoy!”

SEGA-Sammy is doing what good businesses do, they are restructuring to make profits, not just in SEGA America but also its Amusement division (arcade). This mean’t that they had to fire a total of 300 employees, they moved their San Francisco offices to Southern California and that they will ‘focus’ on businesses bringing in the most profit. This just happens to be the mobile and PC digital market. Does this mean they aren’t making console games? No and nowhere in there statements does it say that. If mainstream ‘gaming journalist’ actually did research they would have known as such. Another thing not mentioned in these click-bait articles is that there is also a SEGA Europe and a SEGA Japan who aren’t mentioned in these reports, meaning the ‘focusing on digital and PC‘ seems to be directed at the American branch.

Read our report on SEGA-Sammy’s Q1 2015 earnings report to find out what recent games did well and what bombed.

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63 responses to “SEGA is not leaving the console market

  1. Gen says:

    Even if they aren’t leaving, what’s to say they wont in future? Sega has been getting smaller and smaller, weaker and weaker as time has gone on, they’re a mere shadow of their former selves, what happened to the post 2001 statements after Sega abandoned their home console division? Like “Dreamcast : finished, Sega = unstoppable” and “Sega will own 25% of the entire videogame market” – some statements these turned out to be, Sega merely survives than live, grow and prosper.
    We’ve had ups and downs with Sega constantly, but there’s still more downs than ups, which shows Sega is becoming more irrelevant as a player in the industry as time goes on.
    Why is Sega so bad with management? I recently saw an article with former Sega employees lamenting how negative things are at the company from the “I love Japanese videogames” Facebook site, and based on their statements, it seems Sega is as dumb now as they were 20 years ago.
    I wonder how much more Sega can fail, sink or shrink before it truly is game over for Sega as we know them, I hope this doesn’t come to pass, but it’s happened so many times now, I wonder if it’s really only a matter of time now, before Sega goes a similar way to the way SNK did.

    • Trippled says:

      It doesn’t state shriking tough.

      They aren’t setting up new operational firms and a new structure with Sega Sammy Holdings so they can downsize.

    • R3N0 says:

      “2001 statements after Sega abandoned their home console division? Like “Dreamcast : finished, Sega = unstoppable” and “Sega will own 25% of the entire videogame market”
      That could have happened but Sega heart died in 2001.Isao Okawa Died and that was the begining of the end for Sega.
      Then the dying Sega was devoured like a animal by Sammy.
      Sammy forced them to merge that is why during the merge many people left the company. They destroyed Sega and closed down all their great individual studios and forced them to merge.

    • Trippled says:

      No studio was closed down, they were consolidated to the the way they were pre-2000.

      Hisao Oguchi knew Isao Okawa well, and did everything in the best interrest to make Sega profitable like it was in the 90’s. And he did, by Sega understanding the Japanese market (Arcade>F2P>smartphones).

      There was just never going to be a way of Sega owning 1/4 of the gaming market through their japanese games, it was never going to be mass-market.

    • Gen says:

      Correct me if I’m wrong, but the Sega-Sammy was more a ‘merger’ than an outright ‘take-over’ was it not? Sega the corporation (formerly ‘Sega Enterprises’ prior to 2000) is still it’s own singular entity – only it’s owned by the Collective ‘Sega-Sammy holdings’ company – it’s a merger between the two companies where they share all their assets and collective holdings, it’s essentially a marriage, Sega wasn’t the only one to go through this, Square has done it with Enix, Namco with Bandai and SNK with Playmore ect – this started to become common with Japanese videogame companies around the same time Sega done it with Sammy in 2003 – essentially making them the biggest videogame company overnight, yes some Sega talent left as they didn’t want any Sammy influence at all, Sega was still supporting the Dreamcast officially all the way up as far as 2006 – and it’s rumoured they’d continued it even longer if not for management from the Sammy side discouraging it.

    • Gen says:

      Don’t forget also, that prior to Sega-Sammy holdings formation, Sega Enterprises was a CSK company, CSK had a significant portion of controlling shares in Sega throughout nearly all of Sega’s home console releases. And before that, at one point, Bally’s had the shares in Sega before CSK and Gulf & Western, Ballys make pin ball tables I heard then, and so many Sega developed pin ball tables are still around in circulation.

  2. signorebravo says:

    Thanks for posting the article; I too got caught up with the media report. I do believe there is truth to the media reports; downsizing on console releases compared to past years. Not much software was released last year and will drop further for 2015/2016 (time will tell at e3 not far away). I do agree with Gen’s comments – there is something seriously wrong with SEGA’s management… They have lost so much software talent over the years says something serious about the company. Compare it to Nintendo; and I can’t think of software talent that have left to set up their own companies. Sammy is better off selling SEGA & it’s wonderful IP to the likes of Nintendo. I’d hate to see SEGA sail into the abyss or continue dying this slow and horrible death.

  3. Shinobi100 says:

    First, let me explain something. As a kid, I had a Game Gear. Then I had a Genesis. Then I had a Dreamcast. I never had a Game Boy Color. I never had a Super Nintendo. I never had a GameCube. I LOVE Sega.

    Still, SEGA today is not a good company. They haven’t been for a while. They haven’t been since gaming moved to the 3D realm, to be exact. Now, they are NOTHING like that company I grew up loving.

    Conversely, let’s look at Nintendo. They have FLOURISHED since gaming moved to 3D. You know why? They never changed! They just improved the formula. Super Mario 64 plays EXACTLY like Super Mario 3, except it’s in 3D. Super Mario Galaxy plays exactly like Super Mario 64, except it has a vastly more expansive world. Plus, they still release retro-feeling side-scrolling Mario Games like New Super Mario Bros. that play EXACTLY like the very first Super Mario Bros. on NES.

    Let’s look at Nintendo’s other 1st party games: Metroid Prime, Yoshi’s New Island, Legend of Zelda: Majora’s Mask, Pokemon Omega Ruby, Captain Toad’s Treasure Tracker, Star Fox Wii U. What do all these games have in common? They all appeal to our retro-loving instincts. Retro IPs, retro play styles, retro ports. That’s why Nintendo has an army of loyalists, they never change and upset them.

    What about Sega feels retro? Where is Vectorman? Where is Ax Battler? Sketch Turner? Blaze Fielding? Alex Kidd? Joe Musashi? TJ & E? Ristar, dammit, where is he?? SEGA gave up on their retro IPs. Or, like in the case of Shinobi, gave it so little priority that they just handed it off to a 3rd party developer on a handheld.

    How does Sonic today compare to Sonic on Genesis? Well, he sucks. I don’t remember being forced to run on Genesis. That sums up most of his recent efforts. Gimmick excuses for games that have as much depth as a Ipod game. They couldn’t even get the basic platforming controls of Sonic in 2D for Sonic 4. They did go back to giving total control of speed in Lost Wind, but the level design was terrible.

    Which brings me to my final point: SEGA does not have major company quality control. They’re more a smaller company that makes shovelware like Majesco or whoever the big shovelware companies are. Good major companies just don’t let a game like Aliens: Colonial Marines get out the door.

    It’s so simple: you keep your iconic IPs. You move them into 3D while keeping the basic elements of gameplay intact. That means the basic enemies always take one hit to kill in Shinobi. 100 rings gets Sonic an extra life. I want SEGA to succeed, but they’re a bunch of stubborn old Japanese folk who will never change their ways.

    All I want is the 3D Classics compilation for 3DS to come to the West.

    • A cartridge release of a mix of games from wave 1 and 2 is unnecessary. SEGA of America is releasing every single game digitally. To release a packaged release of select titles would be fun for fans, but it just wouldn’t sell and SEGA would likely not make profit. Especially when fans have already downloaded the titles and the only extra content are two Master System games.

    • Hitrax says:

      Not only that, it would significantly decrease Sega’s profits if it were released as a single pack rather than as a series of separate releases, as multi-pack games are still treated as single game releases, a 5-pack game collection like say Sega Vintage Collection on the Sega/Mega CD is considered one title and so Sega only generates a single profit from that one release, however if those 5 titles in that pack were released individually as separate releases, provided everybody to a significant amount of people buys most to all of the series, then Sega will generate rougthly 5 times the level of profit, even if people don’t get the entire series, Sega will more likely than not, make more money from it than if they just plainly bundled the entire set in one pack. It’d be good for the gamers as they have the whole series right there but it’d be bad for Sega as they’d minimise profit potential.

    • Gen says:

      Perfect, you don’t spend all that money and time researching and developing IP like Shinobi, Streets of Rage and Shenmue ect and then do nothing with them, it’s a total waste of potential, these are brands that could have been well more than what they are now, Shenmue would have done way better had Sega treated it’s own IP with more respect in the past and done something with them, because they didn’t, Sega’s market share shrank and high budget projects like Shenmue suffered from it, yes, Sega’s IP software suffers as much as their hardware did, I wouldn’t be surprised if it ends up the same way.

      When you think of it, though Sega Japan is the HQ of Sega as a whole, it’s really been Sega’s western divisions that have made Sega as big as they became in the global sense, think about it, Sega’s most successful product is still the Mega Drive/Genesis – it wasn’t as big as it could have been in Japan, but did just ‘okayish’ by comparison, and when we talk about the Saturn being a big success in Japan – that was only because it did so miserably in the west that it made it’s Japanese side look good by comparison, it initially outsold even the Playstation there until Sega’s negligence and bad management finally took it’s toll and caught up, Sega had several opportunities to be as big and powerful as Sony is now, but they took their eye off the ball and others took over. Sega is still a globally recognised brand but then at it’s core – it’s really a videogame company – particularly an Arcade videogame company – where they started life – and this industry has been in decline for decades now as the home console hardware business has taken the lead, so Sega’s the biggest part of a declining industry, Sega could have cemented it’s position in the home console division in the way they are in the Arcade division, but of course, abandoning their home console series in 2001 scuppered that opportunity.
      And at that time, Sega bigwigs were trying to say it wasn’t a bad thing as Sega consoles were holding them back from taking over more of the industry, other way round more like, and 14 years on, we can clearly see that, Sega management simply stinks, and they don’t seem to have done enough to improve after all those years.

    • SaturnIsBest says:

      Never had a Saturn? Tells me everything I need to know.

    • Gen says:

      Yes, I had a Saturn, I remember vividly being the only one in my entire high school of a 1000 or so, who had one, in all the time I was there, I think I only ever came across one other Saturn owner there, whereas everyone else, even Mega Drive owners had gone with the Playstation – a system that almost could have been the Sega console. The rest were N64 folk, it certainly made an impression when you said you were a Saturn owner, one thing that can be said for certain is that if you ever came across a Saturn owner in the west, it’s very likely they were hard core enthusiasts, they had to be, and this was true in my own experience, as it was the only way you’d get anything from the Saturn and knew how great some of the titles it brought with it were – too bad many never even knew they existed.

    • Eric Breaux says:

      Pokemon is Game Freak not Nintendo, which only owns them. Nintendo did not contribute to the founding of that studio or the creation of Pokemon. And Vectorman, Sketch Turner and Toejam and Earl are not Sega but Sega of America, a foreign division of the JAPAN established company.
      Ever heard of Valkyria Chronicles, Phantasy Star, Yakuza, Super Monkey Ball or Virtual On etc., all of which have outstanding reception?
      Sega of America and Europe are really stupid counterproductive business managers for ignoring every other of their parent Japanese company’s IPs and tarnishing Segas brand recognition and legacy as a developer worldwide, all because they put their fan bias above Segas success in wanting to try to make Sonic as relevant as during his first 5 Genesis/Mega Drive games. Meanwhile Sega’s gaining laughably low sales on all their other series in the west, many of which they’ve been leaving dormant, some for years now, completely pushing away potential sales and popularity for them…because they can I guess, and then they complain about low sales like they expect people to just magically know about their other games, when the west only markets freaking Sonic.
      At least Sega actually markets most of their games in their native country of Japan, but that can only go so far in terms of establishing a worldwide fanbase and at least as much profit from it.
      Sega needs to open they’re eyes to the bigger picture and start making sure that they’re western branches actually market all they’re other IPs, so people worldwide will know more of what Segas about, not just for a fad conceived solely for competing with Mario that got old during the console generation it was created in. Sonic would sell substantially worse in the west than any other Sega IP if he got as little advertisement as them, especially if they got as much marketing as what Sonic gets. That’s exactly why in Segas native country of Japan, where all of they’re IPs are equally known, Sonic isn’t worth crap and their profiting on most of their other games, which are smash hits there.

  4. Shinobi100 says:

    I mean, how awesome would it be to have grown up a Nintendo fan boy in an alternate dimension? When you know that every new 1st party game is not only an IP from your childhood, but that it will also be of the same high quality that those IPS had when you were a kid. Instead of Captain Toad’s Treasure Tracker, we get Alex Kidd’s Quest for Gold. Instead of an army of Nintendo IPs in Smash Bros with Sonic thrown in with a generic moveset, we get an army of Sega IPs in Power Stone Pummelfest. Instead of Star Fox Wij U, we get a new Panzer Dragoon that uses elements of Virtual Reality.

  5. Shinobi100 says:

    Here are some numbers for SEGA and the guy who wrote this article, both of whom think the market is stronger on mobile and PC. Here is a list of the estimated number of physical copies of some Nintendo 1st party IPs released since 2012, which were only released on CONSOLES. Only a single console for each title, at that, amazingly:

    – Pokemon X – 12.7 mill
    – New Super Mario Bros. 2 – 8.6 mill
    – Pokemon Omega – 7.8 mill
    – Animal Crossing: New Leaf – 7.7 mill
    – Smash Bros. for 3DS and Wii U – over 5 mill
    – New Super Mario Bros. U – 4.7 mill
    – Mario Kart 8 – 4.3 mill
    – Luigi’s Mansion: Dark Moon – 4.1 mill
    – Nintendo Land – 3.9 mill
    – Super Mario 3D World – 3 mill

    What do all these games have in common? They’re all based on IPs that originated 14+ years ago! they’re all all-ages friendly just like every game pretty much was 14+ years ago! and they’re all well reviewed.

    It seems to me that the problem isn’t that the audience moved to mobile. It’s that the audience is holding out for high quality iterations of iconic IPs that are well reviews by critics and word of mouth. I challenge ALL of you drunk on the idiotic idea that mobile is better for developers than consoles to find ANY iconic IPs that came out with a well-reviewed game that sold worse at retail than Sonic’s last two pathetic excuses for games.

    SEGA SHOULD sell their IPs to Nintendo. Because their IPs are second in strength only to Nintendo. All they need to start performing well again is developers with skill and care enough to not release them into the wild again until they’re ready. Luigi’s Mansion: Dark Moon was in development for a loooong time. Mr. Miyamoto actually gives a damn

    • Hitrax says:

      I mentioned this earlier in the recent Tom Kalinske article, because it simply does not matter that Sega is bigger now than they were in the past or if they sell the odd million or so titles – selling a million isn’t any significant feat anymore as it was 15/20 years ago, Sega hasn’t grown larger than they’ve ever been in the past based on their own success and decision making processes, they’ve grown larger only because the VideoGame industry as a whole has grown larger, therefore smaller companies back then are bigger now relative to the time, but relative to the industries size as a whole, they are still small in comparison to others, Sega simply isn’t big news like they used to be, they’re still around sure but it’s probably safe to say that it’s very unlikely they’ll ever have the same level of power that they did in 1992, the industry back then was obviously a bit smaller then than it is today, but Sega was massive back then and a huge influence compared to todays bigger industry, they had the power to influence the whole industry in the direction they wanted, today, they don’t have anywhere near that power at all.
      Making an acquisition here and there shows Sega is doing fine surviving and getting along with the industry but they aren’t thriving like they once were in the good days.

      To narrow it down, I suppose we could say that Sega is merely following the industry, as compared to before – where they were actually shaping and controlling the industry, when they were a major player, with their own hardware division ect.

    • Aki-at says:

      Here’s a figure for you.

      Chain Chronicle did $73 million worth of revenue for SEGA with only a million downloads and being exclusive to Japan in 9 months. 3 years it’s going strong and probably has made more money for SEGA than a few of those titles you just listed.

      Sonic Dash has over 70 million downloads.

      Puyo Quest has also achieved close to $70 million the same time frame, more successful than ANY Puyo game in the entire series.

      Phantasy Star Online 2 is the most successful title in the Phantasy Star series and that’s it being available only in Japan.

      These titles are more successful the majority of SEGA’s titles in their history. The ignorance you have towards the mobile market is astonishing especially, it’s already the same size as the console market in Japan and growing. And for PC gaming? It already houses the most successful platform exclusive game franchises in Dota 2 and League of Legend and it’ll only continue to grow.

    • Shinobi100 says:

      Sonic Dash has over 70 million downloads? Cool. What percent of those resulted in a paid transaction? 20%? I didn’t buy anything when I downloaded it. Neither did my nieces or nephews have any desire to. I’d say 20% is being generous. So SEGA got $9.99 on average from 14 thousand people. Impressive! I assume that’s exactly why they had to downsize. Don’t use deceptive stats. It makes you a villain.

    • Shinobi100 says:

      *14 million is the correct number at 20%. I be no villain. But let’s be realistic, the number of paid transactions is probably closer to 10%. It’s not a game that lends itself to transactions. So now we’re talking about a paltry $14 million (American) in sales.

      My numbers are just speculation, true. But it is undeniable fact that if you can release a retail title that sells millions of copies, like Nintendo, Microsoft, Sony, EA, Konami, Namco, Ubisoft, and pretty much every major console company besides SEGA has figured out how to do, you will dwarf the profit of 99.9% of free-to-play games.

    • Aki-at says:

      Again your maths is completely off. 10% of 70,000,000 is 7,000,000. 7,000,000* = $69,930,000.

      That’s as much money coming back to the publisher if they had sold 2 million units at retail. SEGA has 2 F2Ps that already do this and probably more so in the future.

      It’s funny you used Namco as an example. In 2013 the only title they had that broke a million was Tekken Tag Tournament 2, the following year was Dark Souls 2 with 1.2 million and so far this year they have nothing that has broken over a million copies. Whilst SEGA has 3/4 series that sell over a million and 2 that do over 2 million.

      Arguing that successful console titles will dwarf the sales of 99.9% F2P games is unfair because that statement can easily be turned around and say successful mobile titles dwarf the sales of 99.9% core games. Infact, Puzzles and Dragons $2.5 billion of revenue far outweighs pretty much anything recent from the core gaming market with the closet being GTAV. Even then, GTAVs $2 billion worth of revenue, only 50% or so goes back to the publisher whilst Puzzles and Dragons brings back a bigger return on investment for their developer on a much smaller budget.

    • Shinobi100 says:

      I used Namco as an example because they developed the most recent iteration of Smash Bros. Retail has filled up their pockets with cash.

    • Aki-at says:

      Smash Bros is not Namco’s product and they are not publishing it. SEGA just released Alien: Isolation which racked up over 1.7 million sales and sure to go past 2 million but it’s not their IP and they cannot rely on it just like Namco cannot rely on Smash Bros.

    • Aki-at says:

      I’m not using deceptive stats, I’m using figures published by SEGA.

      Chain Chronicle is F2P, it’s done over $70 million. I’ve been paying it and not spent a single penny on it, neither has my nephew. Therefore that must mean SEGA made no money? Wrong, that’s anecdotal evidence and has no place in discussion with a stat based argument.

      Puyo Quest is also F2P, like Chain Chronicle, and has done over $70 million. Puzzles and Dragon, Japan’s number one mobile money maker is also F2P, it grosses over 500 million dollars in revenue and is again another game I haven’t spent a single penny on.

      I’m not sure where you got 14,000 being 20% of 70,000,000. That’s not 20%, that’s not even 2%, hell it’s not even 0.2%, that’s 0.0002%. 20% of 70,000,000 is 14,000,000. 14,000,000 * $9.99 = $139,860,000 revenue. At least get your primary school maths correct if you want to argue figures with me instead of calling me a villain.

    • Shinobi100 says:

      You do not have numbers for Sonic Dash’s paid transactions. I have a number. Of the 1st 100 million to download Minecraft, only 14.3 mill paid. That’s 14%. Any form of logic will tell you that Minecraft has significantly more potential for paid transactions than Sonic Dash. I’m reducing my projected number to 7 million transactions at an average of $5. That translates to $35 million, correct? 2 million copies of a $60 translates to $120 million, correct? $120 million dwarfs $35 million, correct?

      Oh, you sly dog, you’re being deceptive again! You mention that Puzzles and Dragons netted a huge profit. I assume you mention that to imply that any games can become huge sellers on mobile. But as I previously said, console games outsell 99.9% of mobile games. P & D is one of those .1%. The number is probably close to 99.99%. So P&D is actually in the .01%.

      Here’s the other thing: P & D was made by a no-name company called “GungHo”. The current game that’s all the rage in America, ‘Crossy Road’, was developed by “Hipster Whale”. Yes, Hipster Whale. Mobile is an untamable beast and completely unpredictable. Any company who dives into that gamble of a platform will be reduced to nothing.

    • Aki-at says:

      You do not have the numbers for Sonic Dash either, however we have the numbers for Chain Chronicle and for Puyo Quest. But you know you’ve shown how badly you’ve concocted your argument that you continue to backtrack, from getting your numbers wrong to needing to revise the figures down when you realize that they would actually be making bank with that figure. Infact the figure you used there for Minecraft is for the PC verison, which had been downloaded over 100 million times and sold to 14 million, get your links and facts right before posting because the Pocket Edition for Minecraft has sold over 30 million copies http://www.vg247.com/2015/01/12/minecraft-pocket-edition-sales-top-30-million/

      You also seem to think publishers take the full figure of revenue, which is just not the case. Publishers make around 50% per retail unit sold so at 2 million SEGA would be making… $60,000,000 with mobile titles, they keep 70% of all transactions. Which would leave them with $24,500,000. Now let’s look at the budget, Sonic Colours/Generations/Boom cost SEGA $20 million whilst Dash cost SEGA what, under $1 million? ROI for Dash is far greater than console titles and the team in the space of 2 years can pump out 3 games whilst a console team can only pump out 1. It’s fair to see what wins the money wars here in the long run.

      You’re the one being sly here, I mentioned it only because you said successful publishers with successful titles will outsell 99% of mobile titles, well that’s obvious isn’t it? However flipping the statement is true as well, using an outlier is the worse way to argue a point. The truth however is that whilst 30 mobile games might bomb, it can easily be covered by the success of one, likewise, one console game’s success cannot cover the costs of 3, let alone 30, console failures.

      And furthermore please don’t pretend the console industry doesn’t have it’s negative points either, fact is plenty of developers have gone under too and we’ve witnessed the most destructive period in the industry since the crash in America.

    • Kent says:

      Maybe Sega should start a new hardware division specialising in mobile/cell phones and tablets then and capitalise on the fact that mobile gaming is as big as the traditional home console hardware market now, it’d give Sega another opportunity to be a major player again, Sega lost their home console series in ’01, but who cares, at this rate, when Sega left, home consoles were already beginning their inevitable end, Sega got in on it early after the Atari fiasco in the early 80’s and was in it for nearly 20 years before leaving, if they were smart, they could repeat the same process with the mobile market and begin this competitive trend again and learn from the last time, what not to do this time.

  6. Anybody who believes that Nintendo would treat SEGA’s IPs proper are having a laugh.

    And for all the long comments here, which I do appreciate seeing people with opinions and things to say, the point of George’s article was to point out the basic truth that SEGA never stated they are leaving the console business. We can speculate on the future all we want and throw assumptions about Nintendo about and all, but that was not the point of this article. No speculation, just facts in the here and now.

    • Hitrax says:

      Agreed, fed up seeing people say this over and over that Sega IP should go to Nintendo, or that Nintendo should buy Sega ect, Sega isn’t Nintendo and Nintendo isn’t Sega, they are very different companies in too many ways and handle most things completely different.

  7. Shinobi100 says:

    I’m an American who only buys games on physical carts, Nomad. So I assume the news of SEGA reducing their American console presence to the size of a closet hit me a little harder than you. It was announced that Hatsune Miku was coming to 3DS in America last June. I’m assuming that decision was made before the closet decision. I see no silver lining here. It’s over, for all intents and purposes. SEGA has been dead to console owners for a while now, anyway. We’ve just been holding them up like we’re all nostalgic for ‘Weekend at Bernie’s’

    • SEGA is still releasing console games. That is that fact that George is pointing at in this article. Are we seeing a return of every single classic IP? No. Are you going to get your 3D Classics physical release? No. But are SEGA through with releasing physical games? No.

      Also, it’s 2015 dude. Sony, Microsoft, and Nintendo have gone to great lengths to establish digital distribution. To ignore digital titles is your own fault. I’m not sure if it’s on principal, or some issue you have with their payment system, but you need to adapt. I’m certain your 3DS has the space for the 3D Classics and that you can somehow find wifi to connect to the store. What is holding you back?

    • SaturnIsBest says:

      Those digital distribution games will no longer be playable in a few years. The servers won’t be hosting them forever. If you ever need to redownload, you’re screwed.

    • Shinobi100 says:

      True. You won’t even be able to download Sonic Runners from pirates in 15 years. Pirate: “You want to steal the ROM for Sonic the Hedgehog for Genesis and release it to the public?” Pirate 2: “Ya man, I loved that games. What about Sonic Runners?” Pirate 1: “you mean that generic iphone game that we couldn’t even unlock the stuff without transactions which we have no access too? Hell no”

      My point? Physical console games live on forever. Digital ones, aside from maybe ones that are based on physical console games, only live on until your current piece of hardware dies. iPods don’t last very long

    • People argue that physical games are forever, but have you ever heard of disc rot, discs being scratched, lasers burning out, or parts giving up? While very old hardware like cartridge based games have a longer shelf life, especially when the console has no moving parts, even those aren’t forever. I’ve had several disc based games that no longer work, consoles that fail to function (Xbox with a faulty power button and disc drive, SEGA CD, Saturn, and Dreamcast with a dying laser). From the Playstation/Saturn era and beyond, hardware has gotten more complex and is more prone to a short lifespan.

      While yes, digital games are also not forever, people act like the game they paid for and downloaded will disappear tomorrow. Since digital game services began, they’ve taken great strides in ensuring that games you paid and downloaded are available to download again free of charge. Cloud based saves ensure that your progress is not lost even if your hardware dies on you (does a Saturn or Dreamcast do that?). Even games pulled due to rights issues are available to download if you bought them in the past (After Burner Climax, OutRun Online Arcade). For the most part, digital downloads are not tied to a single console. If your hardware dies, you can download your library again on new hardware. I know Nintendo is strict, but even then you are able to transfer to a new console to play your digital games.

      Honestly, I think people unwilling to purchase digital titles are stuck in the past and need to shake off the stupid “in X years I might not be able to play this game” mentality.

    • Shinobi100 says:

      Sony, Microsoft, and. Nintendo are still releasing 1st party retail games on a monthly basis. I’m having trouble seeing how they compare to SEGA’s move to making digital #1 priority? Because from my end there doesn’t appear to be any logic in the comparison.

    • Kent says:

      Could it be that Sega wants to go digital merely to avoid manufacturing costs and thereby cut down on overall development costs like manufacturing of carts and CDs with instruction booklets ect that come with retail releases? It’s not a good sign if they are as no other big name company seems to be having an issue with manufacturing costs, either way, it’s not a good sign, as they can only be doing this for two reasons, either A. They wont to reduce manufacturing costs – indicating they have money trouble, or B. They’re so bad at selling retail titles now that even their mobile business outperforms their core market – retail releases, it’s either one of them or both, there is no other benefit for Sega to go digital only that I can see that would be any good for them, unless they just want stricter controls on their content and when it appears and disappears – if Sega ever did get back into the home hardware market again, the only benefit would be that they can finally pull down all their IP on rival companies hardware that was released before, making it seem like Sega was never a third party company, or at least only for one generation – the 360/PS3/Wii gen.

  8. dawooad says:

    I well not plame sega but were is the games the have alot of games from arachd and consol but were are the

  9. signorebravo says:

    I completely agree with @Shinobi100. It’s truly sad times at SEGA – I’m trying to be optimistic about the big blue but then; I’ve been trying to since they left the console business. In my opinion they need to get back to their roots and focus on classic gaming using their old IP to attract more of the casual gamer audience. Games don’t need to be big budget to be a success in the marketplace – so long as the quality is there (where’s was your quality control with Sonic 4 SEGA?) games will sell. The new Strider by Capcom sold well on Xbone One, 360, PS4, PS3 and Windows. Just had a flashback of hope seeing a new Streets Of Rage that was in development by a now closed down Aussie SEGA studio. Could you just imagine a revisited – Golden Axe, Fantasy Zone, Alex Kidd, Ghost House, Teddy Boy, Wonder Boy, My Hero, Shinobi, Ecco, Space Harrier, After Burner, Out Run, Altered Beast, Crazy Taxi, Daytona USA, Dynamite Dux, Dynamite Cop, Flicky, Chu Chu Rocket, Space Channel 5, Samba De Amigo, Rex, Gunstar Heros, Hang On, House Of The Dead, Jet Star Radio, Mad World, Nights, Otogi, Panzer Dragoon, Phantasy Star, Y’s, Golvellius, Scud Race, Seaman, Enduro Racer, Sega Bass Fishing, Sega GT, Virtua Fighter, Virtua Tennis (Virtua anything!), Shenmue, Shining, Skies of Arcadia, Streets of Rage, Super Monkey Ball, Thunderblade, Toejam & Earl, Valkyria Chronicles, Vectorman, Zaxxon… Guess a SEGA fan boy can dream..

  10. Retroman says:

    I’d like to see SEGA organise a game jam and let indie developers compete to reimagine SEGA’s long-neglected series like Streets of Rage, Shinobi, Alex Kidd, Ecco the Dolphin, Wonder Boy and Golden Axe.
    The best submissions would then be expanded upon, polished and released to the public.

    Something like this wouldn’t be too hard or expensive to accomplish, would it?

    I think it would be a nice way to keep those old series relevant again.

    • Kent says:

      Isn’t that what Kickstarter is for? Not the same, but it’s quite a lot of the seemingly impossible, possible.

  11. wiz says:

    I hardly call 1 Sonic game and 1 Yakuza game per year as remaining in console market.

    @retroman: Indie shoud stay miles away from Sega classic IP.

    • Aki-at says:

      Not really fair considering we had Hatsune Miku Project f 1 and 2, Sonic Boom, Alien: Isolation, Shining Resonance, Dengaki Bunko Fighting Climax, Ryu Ga Gotoku Ishin! Phantasy Star Nova, Hero Bank 1 and 2 and Project 575 last year. You can add Atlus’ console titles to that list too.

      The problem is a good chunk of their content gets locked up and remains in Japan. They need to figure out how to get people to buy them, I’d really just suggest Atlus to handle the marketing.

    • Damon says:

      Probably the only way many of these cherished Sega IPs will ever see the light of day again, Sega is so shamefully hopeless at marketing,

    • retroman says:

      @wiz: Why? I’d rather have an indie-developed Golden Axe/Shinobi/Streets of Rage/Alex Kidd than nothing at all.

      As long as the devs have respect for the source material, I absolutely can’t see any problem with this.

      Take a look at indie developer Bombergames for example. Their Streets of Rage Remake has garnered lots of praise.
      It’s a game they poured lots of love in and didn’t ask anything for in return.
      Just imagine what they could create if SEGA hired them to make a proper follow-up to Streets of Rage.

  12. landman says:

    I have always been a Segafan because they were delivering great franchises each generation, not because they were selling me the same game over and over. And of course that is not very good for business, see the top selling games for the past decade, sequels of games that have a yearly release.

    And that was the greatness of Sega, having good and unique memories of the Master System (Alex Kid, Fantasy Zone, Phantasy Star), the Megadrive (Sonic, Shining Force, Shinobi), the Saturn (Panzer Dragoon, Nights, Clockwork Knight, Burning Rangers) and the Dreamcast (Skies of Arcadia, Jet Set Radio, Shenmue, Space Channel 5, Chu Chu Rocket, PSO), and I’m not even naming most arcade ports! After that I also enjoyed new franchises like Gunvalkyrie, Monkey Ball and Yakuza, and last generation we had gems like Valkyria Chronicles, Resonance of Fate, Bayonetta or Madworld.

    What was the average segafan doing when all those new franchises were released? asking for Streets of Rage instead of playing “SoR Adventure” (aka Yakuza). We Sega fans are a minority, that’s why Sega couldn’t survive without changing only with our support, I enjoy a few sequels now and then (Outrun 2, Panzer Dragoon Orta, Shinobi PS2 and 3DS), but I really enjoy is having creative games, something that today, does not sell (out of the indie sector).

  13. Keeppassingcars says:

    With so much creativity in producing games made by smaller teams, I’m surprised SEGA hasn’t jumped on the indie band wagon and reinvented their IP.

  14. Shinobi100 says:

    My comments up to this point have been extremely negative. With the mods permission, I’d like to attempt to lighten the mood with a story that only mildly relates. Last night, I was watching the show ‘Victorious’ on TeenNick, which stars the beautiful, young American actress, Victoria Justice. My 9 year old niece was sitting on my lap watching it with me.

    This particular episodes was titled, “Tori & Jade’s Play Date”. Jade is played by another beautiful, young American actress on the show, Elizabeth Gillies. Tori (Victoria) and Jade are normally sworn enemies. But in this episode they’re forced to act as husband and wife in a school play. To better prepare them for this task, their acting instructor has them go on a simulated date at a hip local eating establishment/karaoke bar for 5 hours. The teacher assigns two nerdy guys in the glass to spy on the girls and make sure they’re fulfilling their assignment.

    Tori and Jade sit at the counter uncomfortable for awhile before Tori finally says, “There must be SOMETHING good you can say about me.” Jade, who is a bit of punk who normally speaks in a dry, sarcastic voice, softened up a bit and said, “Well, I guess, in certain lighting, some people might say that you are really pretty.” Tori can’t help but smile after seeing Jade open up, and she chimes back, “I think you’re really pretty, too.”

    It was at this moment that time seemed to freeze, and that Tori and Jade might actually be developing true affection for each other. That they may even kiss. Luckily, my 9 year old niece doesn’t understand human anatomy, or the fact that my lap suddenly got a lot more uncomfortable to sit on would have made her a lot more uncomfortable…

    My niece owns the DS game “Victorious: Taking the Lead”. I find a decent amount of enjoyment in the title. A decent amount of that enjoyment is from being able to use a D-pad and buttons, and carry the game cart around, and look at the back of the box. That pretty much sums up why this whole SEGA downsizing ordeal turned me into a whiney child. My good feelings for SEGA began with them being an innovative, in-your-face console developer. I always wanted it to stay that way. Is SEGA completely done on consoles? Probably not. But a token game here and there is not enough to sustain a universe where I can escape this life

  15. Leo The Woodlouse says:

    I’m enjoying this little interesting tit for tat debate between Shinobi100 and Aki-at I must confess, there’s a lot to learn from this discussion.

  16. Leo The Woodlouse says:

    All in all, it’s not a good sign, or maybe it’s simply just Sega-Sammy holdings, caring for nothing but cashflow again, and will dispose of any loss making liabilities no matter how small they are, or even anything that doesn’t make a loss at all but still fails to generate a lot more after breaking even.

  17. Senjav says:

    I remember, back in 1998, someone wrote a letter into the Official Sega Saturn Magazine (headed by Emap) that the song Bitter sweet Symphony by the Verve was essentially likened as a message by Sega.

  18. Hitrax says:

    Sega’s music is much like the Japanese fusion band ‘Casiopea’.
    Infact most Sega music was heavily influenced by Casiopea. Especially S.S.T band / outrun.

  19. Doubt says:

    I liked how as soon as SEGA said they wanted to be more focused on mobile and PC gaming market, everyone went like “LOL PC MASTER RACE FTW!!” and “OMG SEGA STOPPED MAKIN CONSOLE GAMES!!”, when SEGA never said they were leaving the console market at all.

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  21. Crackers says:

    It seems that a lot of people keep rambling on about how Sega have to used their best IP in recent years, but I don’t think it would make any difference. Toejam and Earl, Victorian, and Ristar? Who even remembers those? Only the hard core gamers from the Mega Drive/Genesis era remember these. They won’t shift many copies, and when Sega did revive some of their classic brands who went out and bought them? Many were crap (the Sega Ages ‘3D’ remakes were sometimes cringeworthy), and some were just not marketed enough (Panzer Dragoon Orta), but even when Sega got it right in the post-Dreamcast era, their best efforts did not translate to massive sales. Out Run 2 was quite good, but it didn’t really change the companies fortunes. virtual Fighter 5 was a top quality arcade fighting game, but the console versions were not very popular. Sega made many different types of games, but their arcade heritage is hard to shake off. The games were typically stunning in the visual department and provided excellent short term thrills, and their arcade games were usually a generation or two ahead of the home market. As consoles became more powerful, Sega’s arcade games delivered less than the most impressive games that were available on home consoles. People used to visit arcades to experience games they will not be able to play at home for some time, and the cutting edge arcade technology never failed to impress. When the Dreamcast came out, identical versions of arcade games could be played on the Dreamcast and systems that followed. It meant the technology gap was closing, and when Sega made the Lindbergh system for arcades that was the last time, it could claim its arcade technology as being superior to the home consoles of the time (Ps2, Gamecube – not Xbox 360 though – a virtually arcade perfect version of that game came out on 360). With Sega being unable to woo arcade audiences, the Japanese arcade division has started to diminish in size and profits are falling. If Sega make a new Streets of Rage, will it mean anything to the 20-something university kids who buy the newer consoles to play game like GTS V with their friends? I mean, the kind of game Sega made is no longer what sells systems. Even if they make the best Streets of Rage game, its sales figures will be really low, and they would either take the ‘modernising approach’ (characters rendered in 3d, but having the same style of the original games), or create a 2D mobile game, which I am sure is on its way anyway. None of these approaches will make it a hit. I think people who play games today keep saying they want the old Sega games, but I think very few people would actually buy them, and those that do, usually moan that they were crap, and that Sega should just re-release their older classic games.When they do, they hardly turn a profit.
    Sad thing is that Sega will become like Atari, re-releasing games form their glory years, devaluing the older products and tarnishing their name. I am sure HD remakes of Shenmue, and reissues of ‘lost classics’ such as Chaotix will soon be everywhere. A company should be proud of its past, and certainly it should exploit it, but a company that is only living in the past becomes synonymous with that horrible term ‘retro’.
    I would rather think of Sega as a company that is still relevant rather than read article after article regretting the same history of the company’s greatness, and how cool Sonic was in the early 90s, and how good the music was for Streets of Rage 2. This isn’t exactly ancient history, and many gamers read the articles when the games came out, pored over every screenshot and played the actual games to death. People keep talking about a Shenmue 3. Considering no one bought the first two, why would they invest money they don’t have to make a game that only has about 500 Sega fans? Again, it does not translate to sales. I would love to see a sequel to Rez, or a new version of Jet Set Radio or Daytone USA, but even if these games come out, these franchises have no real meaning for most video game players today.They either come across as being old games, or new versions of old games, and neither of these categories inspires people to purchase an older title. Also, although the Wii sequel for Nights was not terrible, it was hardly worth playing.If there had been no Nights on the Saturn, no one would have even touched it, and Sega would have been crucified by critics for its dodgy controls and boring gameplay. The original was cool because it had that arcade style feel, and Sega modernised it by making it more story-centric. Games in the past had a story because people needed to know what they were supposed to be doing. The story was incidental. Games were mainly for entertainment.Since story became the main focus, games have become stale and boring. If I want story I will read a novel or watch a movie. In my opinion, games that have too much story, cutscenes and justification f every action detract from what made games fun in the 16 bit era. I know this sounds stupid but not everyone likes a lot of bloat added to a game. All we need to know is that zombies have taken over a hotel, and you are the only person to rescue the hostages. You have a weapon and you send the zombies to kingdom come, and after playing on and facing some cool bosses, you see a simple ending, and that’s that. Developers are becoming too pretentious, and I think Sega game s just don’t have that level of pretentiousness, and that is why people don’t like them anymore. I hope things change as I still like the old-fashioned games because they usually focussed on entertainment value. No one will remember the Last of US, a tedious and boring game, which tell us the same old story we have seen in countless movies. Do we really need games like GTS V? We do because they sell, but I find game like that immensely boring an dI think there should be more variety.

  22. Crackers says:

    I meant Vecotrmlan, instead of Victorian. My computer felt like it had to ‘correct’ me, which is fine, but how can a computer not know Victorian?

  23. Mayra Raiola says:

    Sega is not going to survive much longer, I admire their change in operation plan but if the continue to mismanage they will fail again. Sega failed to improve,this improvement would have given them competitive advantage and maybe kept them in the market.

    • Christa says:

      Unfortunately, Sega’s been deeply dysfunctional at the corporate level for decades. Waiting for them to turn around has been something many of us have been doing since the mid-90’s. Honestly, I’m hoping for an aquisition by a company that would allow them to maintain the SEGA brand. Nintendo or Capcom would be great, if they weren’t in trouble themselves.

  24. Christa says:

    I feel that this article is a bit disingenuous, Sure, they may not be about to close, but a year of halved profits, cancelled titles, and large scale layoffs…. there’s no way to read that as anything but the Blue Blur in serious trouble. Can they rebound? Anything’s possible, but their work is certainly cut out for them if they want to survive and stave off acquisition. By any reasonable metric, they’re in bad shape. The fact that this state is more common than uncommon for the company bodes ill.

  25. Ronlad McMuffin says:

    Revamping classic IP’s to suit a new generation is merely an exercise in R&D and marketing, however pleasing 2 camps is an age old problem but also vital to progression.
    We see this in all aspects of retail, 15 year old looks at parent’s old photos and rolls around the floor at the sight of dad in flares. 12 months later TV, magazines and the current hottest TV/Movie/Music stars get sponsored by the big fashion houses to wear flares; Now 16 year old kid goes to the store buys flares and comments how awesome he/she looks. Parent’s from the original photo are not so quick to buy into the new version and prefer rather to reminisce about the associated memories from said photo, eventually they take the plunge and proudly sport new flares to 16 year old. 16 year old now feels alienated and ashamed to have the same tastes of said parents, it’s an insult to a growing persons individuality, flares are quickly discarded to the trash and replaced with skinny jeans (unaware of parents same progression back in the 80’s).
    To keep everyone happy, averages say you need parallel development, business and banks dictate that you must choose the path of least resistance and biggest return (who is the majority?). R&D would indicate rebooting an IP (perhaps reversing flares and combing with skinny jeans, tight ankle trousers with waistlines of parachute proportions, do we all want to hit the clubs looking like Biggles and the Red Barron?). Here in lies the problem, the answer to the last question is “of course not”. We can reboot but it has to be focused solely to attracting a new market whilst wiping the previous slate clean, asking the buying public to forgive previous sins and give a second chance.
    Old IP’s can work but need a complete reimaging, take the beloved Streets of Rage/Bare Knuckle. Playing it now takes 30-40 minutes to breeze through, a good fun little challenge but not engaging enough for a modern audience nor a $50 price tag. Sure we could 2.5 D it and make it 100 levels long but still it would go the way of the Titanic. However if you were to strip it to its basic elements of gangs and factions, controlling the city etc., we are moving into GTA territory, remaking GTA is not going to work as it will be instantly classified as a bargain bin clone, so why not instead augment the IP into current tech and gaming habits? Make it Massive Multiplayer, implement clans, real time missions and territorial attacks, no one is the good guy or the bad guy just a never expanding turf war. Again we go full circle as all the said already exist in various guises and games that are already super successful. Sega has to take the past, target the current audience and make them believe that what they are selling is the biggest, bad ass and best than what everyone else is doing, but most importantly it has to be executed at that level, Sega used to achieve this as they at one time believed they were the best at what they did and declared all-out war to be the best, unfortunately after a couple of bad cookies Sega lost it’s appetite.

  26. Andreas says:

    Sega Genesis and sega dreamcast was the best console and games ever made in the year 90,s and sonic adventure was amazing cool and smart game about chao adventure to make level up to make real chaos!. I was so inlove that game and please make Brand New sega console with sonic adventure 3 with the same voices on sonic adventure 1 and 2. And ecco the dolphin was very beautiful game too. I hope maybe next year because shenmue 3 is coming up. So sega Let start a new game console what you can do. We waiting for years and days about it. Don’t listen the haters of peoples, the old school peoples love your real Sega games. We wish you greatfull succes and thank you so much for hard working and thinking for beautiful sonic adventure ecco the dolphin and another sega games.

    Sega never get old and we waiting and hopes new Sega console come out with the best games of sonic adventure or Ecco the dolphin or Disney games was on the genesis too.

    Much greetings: Andreas

  27. Bray says:

    Actually it is a lot easier to make a game console nowadays, it is also cheaper than before, so why not, SEGA can make something like Nvidia shield and create a SEGA network to sell online copies of all games and that could be the key to save the company… that is what Nintendo is doing with the Nintendo NX.

    Come On!!!… Sonic, Shenmue, House of Dead, Crazy Taxi, PSO, etc… can easily save the company.

  28. Chromeknight says:

    Why doesn’t Sega create their own market of Gamer-phone that uses bluetooth to act as a controller for a new game console they could make. And bring back old titles such as Skies of Arcadia ( and use the gamer-phone to play mini games for the console games on the go) I mean, COME ON Sega!!!! Think big, go all in, or get out. If you don’t care about becoming something great anymore, just sell the company to someone who will! Grow some BALLS!! What good does it do you to play it safe. If that was the case why did the founders of Sega ever come out with a system at all. They could have invested their money in something else if that’s the case.

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