Sega Cancels Merger With Sammy

After many complicated and confusing rumors, Bloomberg Japan seems to have confirmed that Sega Corp has abandoned plans to merge with Sammy. Apparently, Sega couldn't agree financial terms with Sammy, who specialize in pachinko machines, and also have some home and arcade-based videogame development. The front-runner for a Sega merger/sale is now Namco, but Microsoft and Electronic Arts have also been mentioned as possible suitors. The saga continues..

Comments

Microsoft

[nametaken]

I figured their gaming console department would be on the back burner, finacially, after the XBox fiasco.

My perspective as an ex-SEGA employee

[Samir Gupta]

I worked in one of SEGA's advanced R&D divisions for over 12 years before moving to Nintendo, and I felt very priveleged to work with some of the brightest minds in the gaming industry. While SEGA is not the bright star it used to be, I do think that they have potential, and they need to approach the issue of acquisition carefully based on their core competencies.

First and foremost, SEGA is for all intents and purposes, two different companies, hardware and software, and should be treated as such.

As far as hardware is concerned, even with the demise of Dreamcast, SEGA has a formidable portfolio of technical IP, mostly in the arcade arena. It'd be a boon for any company to acquire the incredibly talented AM divisions, and continue their pioneering work in arcade machines -- Konami would probably be a good suitor, in my opinion. They are one of the strongest players in the arcade space these days, both technically and gameplay-wise, thanks to Bemani and the mocap games, the AM guys working for them, they'll find quite a good home and a mutually beneficial relationship as they continue to pioneer new ways of arcade gaming. Sadly, our past leadership diverted too much funding towards fighting a war of attrition with Sony and Nintendo in the home space, when our competencies were really arcade machines. So SEGA should put up their hardware group to an appropriate suitor.

But I do think that SEGA's software side is capable of standing quite independtly by itself. With Sonic Team, etc., and greats such as Yu Suzuki and Yuji Naka, they are a formidable software publisher in its own right, and I would hate to seem them become a Xbox exclusive publisher if they were under the Microsoft aegis. SEGA has long had a repuation for avant-garde games that fit outside the cookie-cutter mold, such as Sonic, Shenmue, etc. and they would do well to continue to exist on their own, and not become assimilated into Microsoft, EA or the like.

In any case, I hope SEGA lives on in some way, shape or form. They are really a pioneer of the industry in so many ways that just happened to be outshone at the right time.