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Sega Downsizing and Refocusing on Mobile and PC Markets May be for the Better

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Some bittersweet news has recently come from Sega Sammy Holdings’ Board of Directors meeting. In an investor notice to shareholders, the publicly traded publisher-developer has identified a need to “review and restructure” the company, and seems to be making an effort to shore itself up in difficult financial times. As the home console and arcade markets struggle in Japan, its subsidiary, Sega Corporation, is cutting at least three hundred jobs in its arcade sector, and will move towards publishing more mobile and PC content.

In the investor notice, Sega Sammy detailed how it would go about implementing what it refers to as “group structure reform”:

The Company […] has held discussions to review the earnings structure of the entire Group from a mid to long-term point of view. The Group announced […] appointment of personnel in charge of structure reform in SEGA, and has developed a structure to enable investment of management resources in growth areas, which include new fields such as Digital Games and Resort Business, while addressing issues in existing businesses. As part of these measures, SEGA has positioned Digital Games, centered around smartphone and PC online gaming, as a growth area and has determined to implement the following measures […]

Sega plans on moving their North American publishing headquarters from San Fransisco to SoCal and, in a rather distressing move, downsizing staff there as well. A reduction in employees in both their Arcade business in Japan and their American branch is rather telling—and may prove either a boon or bane to the efforts of fans trying to get more SEGA titles overseas. The investor notice continues:

Details of Measures for Structure Reform in SEGA

a. Enhancing efficiency in domestic (Japanese) businesses
SEGA will review its business structures mainly in Amusement Businesses (arcade machines) and will narrow down product lineup and withdraw or consolidate and downsize some of the services.
c. Enhancing efficiency in overseas businesses
Local organizations managing (publishing staff, not development staff) 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. In addition, the Sonic and merchandising businesses will be reinforced to establish a structure which can generate stable profits.

A decision to focus more on PC publishing is a long time coming, of course, with Sega always performing well with published titles like the Total War series. Another positive can be found in their decision to heavily focus on Sonic merchandise in the States, which franchise has always been a solid seller.

While corporate restructuring is a long and arduous process that doesn’t guarantee fiscal success, it is important to note that Sega seems to have every intention to hold onto and curate its IPs, and current operations in both development and publishing won’t stop. A shift towards better curation in its publishing arm might go a long way toward saving the company.


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Writer, Cinematographer, Japanophile and Grand Strategy Addict with just enough charm, wit, and mastery of Latin to masquerade as a man of letters. Twitter handle: @waye_farer



30 comments
  1. The_Mad_Monarch
    The_Mad_Monarch
    March 2, 2015 at 10:44 am

    From what I understand they are still going to be allowing some of their non-sega names, such as Atlus, keep doing their own thing. I really hope that is the case.

  2. Ryan Silva #2416
    Ryan Silva #2416
    March 2, 2015 at 10:49 am

    Yup, that’s the case. It won’t be affecting Atlus or Creative Assembly

  3. Valerie Vaulefort
    Valerie Vaulefort
    March 2, 2015 at 10:56 am

    I DID MY WAITING
    TWELVE YEARS OF IT
    IN AZKABAN

  4. Reset Tears
    Reset Tears
    March 2, 2015 at 11:58 am

    Isn’t this what they have been doing for several years now though? They switched their biggest focus to PC and mobile a long time ago, it seemed, at least in the West. It obviously did not save their bacon, so seeing them announce that they’re going to do more of the same feels like an odd plan.

  5. Omnistrand
    Omnistrand
    March 2, 2015 at 12:27 pm

    Hmm, these changes may be positive in terms of the company’s continued survival but is it positive for the consumers? Unless we get a return to form from Sega and they start creating (and localizing) quality games again I can’t really see this as a positive. The company’s still declining and retreating to the less creative/interesting mobile market and we don’t get to see interesting and new IPs showing up out here. On the other hand at least maybe the PC guys can get some good ports if Sega’s generous with their PC refocusing.

    On one final note, I hope the people who got laid off find new jobs quickly, it’s always hard hearing people losing their jobs through no fault of their own

  6. Badmojo7
    Badmojo7
    March 2, 2015 at 12:31 pm

    If sega wants to make money on PC, all they have to do is start porting Atlus’s big titles (Persona for example) on PC.

  7. Ryan Silva #2416
    Ryan Silva #2416
    March 2, 2015 at 12:36 pm

    Well they need to be financially solvent before they start taking risks again. Hopefully the focus on localization drums up enough sales to get them off life-support.

  8. Dimi Gronnings
    Dimi Gronnings
    March 2, 2015 at 12:37 pm

    This bit is notable:

    “Local organizations managing (publishing staff, not development staff) packaged game software in Western markets will be streamlined.”

    By most accounts, the problem with Sega currently is poor management, not the developers, so this could be good news.

  9. Phelan
    Phelan
    March 2, 2015 at 12:40 pm

    Does it mean that we can say goodbye to Persona 5 in Europe?

    I hope they won’t realease it just on PS4… and just as digital copy. I want retail on Ps3… just as much sa I want Dengenki Bunko retail on Vita in EUROPE.

  10. inquisitormcsagington
    inquisitormcsagington
    March 2, 2015 at 1:02 pm

    Just as long as they don’t fuck up TotalWar: Warhammer.

  11. Dimi Gronnings
    Dimi Gronnings
    March 2, 2015 at 1:15 pm

    Atlus and Creative Assembly are largely being left to their own devices since they’re doing really well.

  12. MusouTensei
    MusouTensei
    March 2, 2015 at 1:17 pm

    I think it would be the best if SEGA sells off all their IPs and studios to companies with talent and finally die.

  13. Phelan
    Phelan
    March 2, 2015 at 1:22 pm

    Nope… not in Europe

    Sega is the one publishing ATLUS games… sadly… if only NISA or Ghostlight would be publishing than I would feel safe… but ATLUS? We saw with Dengenki Bunko how they are going to treat 30% bigger market for consoles

  14. landlock
    landlock
    March 2, 2015 at 1:27 pm

    I’m more worried about Atlus then SEGA really. SEGA have been dead for along time. Wonder why they bothered buying Atlus in the first place.

  15. Bananalint
    Bananalint
    March 2, 2015 at 2:23 pm

    Please Sega bring Yakuza to pc!!!

  16. UUDDLRLR BASTART
    UUDDLRLR BASTART
    March 2, 2015 at 2:49 pm

    SEGA does, what Nintendon’t!

  17. Mr. Despair
    Mr. Despair
    March 2, 2015 at 3:30 pm

    As long as they don’t fuck with Atlus it’s fine.

  18. Fenrir007
    Fenrir007
    March 2, 2015 at 4:47 pm

    Moving away from San Francisco is always a good business decision.

    Anyway, I’m always glad to hear “focus on PC” coming from a company. Yakuza on the PC, anyone…? Hey, a man can dream.

  19. Fenrir007
    Fenrir007
    March 2, 2015 at 4:48 pm

    Their PC titles seem to be doing pretty well, actually – just look at the success Valkyria Chonicles had on the PC, or the Total War series. Sonic also sells pretty well when they release it on the PC. If anything, I’d say its their console releases that are dragging their bottom line down. Focusing on what brings money and cutting away what sinks cash sounds like a good business decision.

  20. Thanatos2k
    Thanatos2k
    March 2, 2015 at 7:18 pm

    Mobile is a sucker’s bet. There is no brand loyalty on mobile. You will make money now and that’s it. You can’t build ANYTHING on mobile except trick a small percentage of users into paying for microtransactions.

  21. Anonymous
    Anonymous
    March 2, 2015 at 10:06 pm

    It sound so obvious, why aren’t they doing it is a real mystery.

  22. landlock
    landlock
    March 3, 2015 at 1:08 am

    Shopto is lisiting it as retail so it’ll be coming they will just go through another company like Koch Media/Deep Silver which is what they did with Hatsune Miku games.

  23. landlock
    landlock
    March 3, 2015 at 1:09 am

    For now…

  24. Zanard Bell
    Zanard Bell
    March 3, 2015 at 1:57 am

    They have an entire console age’s worth of games to release on the PC. Your paycheck’s in the mail, Sega: you know what to do.

  25. Zombie_Barioth
    Zombie_Barioth
    March 3, 2015 at 6:33 am

    Shin Megami Tensei and Persona are pretty popular in Japan, so they hoped to leverage their IP. I heard something about themed pachinko machines and stuff like that back when they first bought them.

    Atlus is doing pretty good too, and the decision was made by SEGA Sammy holdings, not SEGA the game company, so it was probably just another investment to them.

  26. Nonscpo
    Nonscpo
    March 3, 2015 at 8:03 am

    As long as mobile includes handhelds I think I’ll be fine.

  27. Omnistrand
    Omnistrand
    March 3, 2015 at 8:48 am

    I agree with that, my only point of contention is that is this the way to go about it? To my knowledge the oversaturation of the mobile market has created a competetive enviornment where it’s pull in a good profit unless your game gets some really good exposure, on the other hand by focusing on the PC they’re expanding their audience to people who have proven they want their games (Valkyria Chronicles on Steam). So ultimately one half of their new policy is sound and yhe other may be hit or miss

    So yeah, I get what you’re saying but in honestly I just don’t think this will result in the large payoffs Sega’s expecting

  28. DariusQ
    DariusQ
    March 3, 2015 at 11:36 am

    Honestly, Sega’s real failing for the last 2 decades has been in its knee jerk management decisions. The arcade and mobile markets are pretty similar (short bursts of gameplay, bright flashy graphics, lots of micro transactions, ect.) so wouldn’t it be smarter to re-purpose its arcade designers towards making mobile games instead of laying them off?

  29. TsukuyomiMagi99
    TsukuyomiMagi99
    March 3, 2015 at 3:51 pm

    Awww! I still want Yakuza Kenzan and Isshin! :(

  30. TsukuyomiMagi99
    TsukuyomiMagi99
    March 3, 2015 at 3:54 pm

    And Shenmue 3!