Sega Begins Restructuring, Shifts Focus Away from Consoles

SegaSega is beginning a restructuring campaign that will reduce their workforce and move their focus away from console game development. According to internal documents issued by Sega’s parent company, Sega Sammy Holdings Inc., about 300 employees will be asked to accept early retirement packages as the company downsizes operations to focus on digital games and amusement games. Sega of America is a major target for loss of jobs citing the plan to close the San Francisco office and relocating remaining staff to their Los Angeles office. An estimated 120 jobs are expected to be lost in North America alone.

The refocusing of Sega should come as no surprise as they have not generated a blockbuster console exclusive title in some time. Alien: Isolation did fairly well for Sega, selling over one million copies, but there is no reason they can’t focus on developing their larger games with digital distribution in mind. With the dry well of localized content from Japan and the poor performance and reception of North American developed titles like the awful Sonic Boom, Sega really has no library of which to develop from.

The internal note focuses on digital game development, including PC and mobile games, as a major area of growth for the company. This has largely been achieved by Sega’s strong performance in both the PC game space as well as their aggressive development of mobile games. With the combined strategy of developing free-to-play mobile games and creating mobile focused franchise off-shoots, Sega has found a little silver lining after years of struggling to make ends meet in the console space.

While I hope their continued development of titles in the PC space means that console ports will continue to be a thing, I feel that Alien: Isolation may be the outlier. Console game sales have been poor in Japan, they barely have the capital to localize their titles (as evidenced by their continued hesitance to bring over Phantasty Star Online 2) and they can’t catch a break with their major franchise stalwart, Sonic.

There’s only so much money pachinko machines can make for Sega and restructuring makes the most sense, though it probably means we have to hope Sony bails them out again for a localization on Yakuza Zero. While the restructuring is a sad moment for the company that once exchanged blows with Nintendo and Sony, the voluntary retirement packages are a classy move.

Eurogamer – Sega to offer 300 staff voluntary retirement as it focuses on smartphone and PC online games


5 thoughts on “Sega Begins Restructuring, Shifts Focus Away from Consoles

  1. Sega has always been the Nintendo of the PC. I’m happy they’re shifting away, while they get less sales on PC, they also have to spend less money on discs, distribution and shipping.

    • I doubt they will abandon console development outright because Yakuza (Ryu ga Gotoku) and their Hatsune Mike games are still very popular in Japan, but they are pretty much dead in the water in the states. Total War seems to be a consistent bread winner for them in the states and hopefully digital performance of their offshoot IPs like Valkyria Chronicles will entice them to continue taking chances on development. But I think they’ve wasted too much money on western development teams making bad to mediocre games.

  2. Sega really seem to be lost with all this great potential, what they should do is FOCUS on consoles but rather get all these IPS people want so badly OUT of Japan and into the West alongside some new entries in one of a few dozen IPs they just don’t acknowledge.

    • There’s clearly not enough money for localization. Most of this lies in Sega’s hands as they’ve always been reluctant to properly support their titles when they localize but honestly, they have no incentive to localize certain titles. Yakuza sales dropped significantly following the original so Yakuza 5 coming west was saved because Sony pushed for it to happen.

      Think about all the great Sega games that are considered cult/niche titles because their sales were low compared to the financial investment. Yakuza, Hatsune Miku, Valkyria Chronicles, Resonance of Fate, Shenmue. They are a company that never seemed to be able to make the transition properly into backing and marketing the titles that truly deserve it. They are already fighting an uphill battle shedding the Japanese design tropes that handcuff their games to expectations. Yes these designs are amazing, but its fairly simple. If a game is too Japanese, it won’t sell in the west.

      We as fans who understand the nuances of a games may cry and want all these great things that Sega makes, but there’s no money in it. Sadly, all they’ve sold is bad games with anthropomorphized animals.

      • Sir some of those animal games are pretty darn good I’ll have ye know!

        There biggest problem I find which similarly was Namco Bandais problem for quite a while is a poor presence in the localized market. I got Hatsune Miku because of a demo on the PSN store, turns out my mild interest was met with one of my favourite games on the PS3 to just have fun playing. I didn’t know of Yakuza till a friend told me, resonance of fate is only known to me as a goddamn amazon related product.

        There is just no marketing for localized products, I bought one Nintendo game called legend of starfy on the DS, it got one trailer once ever when localized and sold poorly…shocking. Shameful as it is a really fun platformer, you can’t sell when people don’t know your selling.

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