To a significant portion of the planet’s population, the name Sega quite literally means “games”: It implies innovation, conjures images and feelings of high-octane entertainment, it’s a beloved epoch of childhood, it is a friend, and it has been a lover. Sega is more than a company name – it’s an aspect of modern history that requires no definition for those who were there.
But behind the name, and its many and passionate sentiments, there’s a sadness which stems the flow of good feelings for gamers almost as quickly as they begin. There’s a feeling that the company hasn’t lived up to its promise. A regret that love’s labor may have been lost.
Historically, the name originates from its conception as Standard Games – an importer of coin-operated amusement machines for U.S. servicemen stationed in Hawaii in the 1940s. When the company moved to Japan, it was renamed Service Games of Japan and later merged with pinball machine importer, Rosen Enterprises, to become Sega (SErvice GAmes), in the 1960s. As a company, Sega has been repeatedly bought and sold in one of those tedious financial paper trails that so easily reduce history to a boring list of dollar signs followed by six or more figures. It’s not important.
What is of importance to contemporary Sega fans is something David Rosen said when he bought his company back from Gulf & Western, after the great videogame market crash of the early ’80s. With his then business partner, Hayao Nakayama, at the helm of Sega of Japan and himself as CEO of Sega of America, the company publicly vowed “never to stick to one concept for too long,” acknowledging that every piece of technology “has a life and a death.” In principle, this policy was sound, and it was reassuring for customers to know Sega would remain committed to pushing the boundaries of videogaming. It has, however, been somewhat of a double-edged sword; pushing boundaries while simultaneously dispossessing consistency.
Whether the management took this philosophy too literally or simply used it as an excuse to circumnavigate problems, it’s impossible to say. In retrospect, one thing is certainly clear – this belief has remained at the core of Sega’s principles ever since, and has turned the developer into something of an industry dichotomy; pledging longevity on the one hand by establishing and supporting long-lived game franchises, embracing brevity on the other by rushing out updated hardware solutions and abandoning console systems as soon as they appear to flag in the market place.
Coupled with Sega’s insistence on sending out confounding mixed messages (interest in its own products seeming to run hot and cold, and severe mood swings guiding vital marketing decisions) there’s little reason to believe that many of the gargantuan problems the developer has faced (and, it must be said, thus far survived) were not entirely self-inflicted.
I still recall the first time I really took notice of Sega. While I was happily partnered to a humble ZX Spectrum – which met all my gaming needs with eight dazzling colors and a cassette tape loading system which only required minimal supervision during its 10-minute loading cycle – I happened upon an advertisement for the Sega Master System. It was in the form of a poster (I think it may have come packaged with other games, though I’ve no idea how I got hold of it), with a single screen shot of each available game.
It was incredible. I vaguely knew the name Sega from the arcades, but until that moment I’d no idea those games could be brought home, especially in such a picture-perfect package. You’d better believe the next time I was in the store I was on the prowl for this magic box with a waterfront arcade inside. Not that I could have afforded one anyway, but the wave of disillusionment that washed over me when I finally hunted a Master System down is still palpable today.
There was no Shinobi, no Golden Axe, no Thunder Blade. All I could find propped against the shelf was some cutesy Alex Kidd rubbish and random sports platitudes designed to lure in parents, not players. I knew what the problem was, of course. It wasn’t the game store that was lacking in shelf candy; it was my naivety that had played tricks on an arcade-addled mind for believing that promo in the first place. No matter, it was gone from my memory the moment I got back to the Spectrum shelf, and it didn’t return until this issue of The Escapist came along.
A few minutes of cursory research gives a different slant to my search for a Master System, and one that backlights the ominous storm cloud that has hung over Sega for a long time. The Master System was the final evolution of two other games systems Sega never granted a U.S. or European release: the SG1000 and the SG1000 Mark II. This initial foray into the home hardware market ran headlong into the Nintendo Famicom and struggled to find a finger hold on the Eastern shelves.
Despite receiving great support from Taiwanese players, the SG1000 was once again remanufactured (very early in its life) into the Master System for the U.S. market. When the consoles didn’t immediately fly off the shelves, Sega’s interest evaporated, and they licensed the Master System rights to toy giant Tonka. Of course, the toy truck manufacturer had no concept of videogames, especially in a market still reeling from collapse, and the Master System sold even worse under their administration. In response, Sega immediately invoked its new philosophies and severed the damaged Master System limb, setting its attention firmly on the future.
But I wasn’t alone in that game store. The same grubby-faced kids I knocked elbows with in the back alley arcades were also hunting for this Holy Grail that promised a wealth of top coin-op titles in the living room. We didn’t know or care who Sega was, or if they’d spent millions of Yen developing hardware; we knew Joe Musashi and the Ferrari Testarossa‘s names, and if they’d been on the shelves to tempt us, the Master System might have lived up to its name and held a very different place in history.
What I don’t know about marketing would fill a warehouse, but selling a Master System to the likes of myself and other arcade creepers would not have been a difficult task. It’s been said the company’s first global console suffered due to a lack of a mascot that could compete with Mario, yet I remember loads of them: We played them three times a week and all weekend in the arcades! Fine, perhaps we didn’t know they were Sega mascots, but their names carried weight with addicted gamers. We cared as much about fancy promotional campaigns as we did about global warming or going to school. All we wanted was the games, and if Sega, or whatever it was called, wasn’t going to give us home conversions of the titles we spent all our money on in the arcade, it could go to hell and wait for us there.
And so the Master System died young and was quietly buried in unconsecrated ground. Sega, true to their beliefs, moved on without, it would seem, looking back, toward the future of gaming: 16-bit consoles and, perhaps fittingly a machine called “Genesis,” which at an approximated 29 millions shipped, is Sega’s best-selling console to date.
Sega’s marketing of the Genesis is fondly remembered for a churlish goading of Nintendo and a playful, almost irreverent indifference to sales figures. This kind of confidence is infectious, giving power to a product while instilling a sense of security in the customer base. Good (or perhaps lucky?) timing was also a significant factor, though neither of these accounts for the phenomenal triumph of the machine
Just as the Master System is accused of being unrepresented by a suitable mascot, it’s commonly held that, until Sonic shot into view, the Genesis was equally voiceless. Yet for almost a decade, the arcades had rung to the splash of overfull coin boxes in games such as Altered Beast, Golden Axe, Hang-On, After Burner, Out Run and an army of other groundbreaking titles. Almost inadvertently, Sega had built itself a Herculean empire from a wealth of franchises ready to come home. Unlike the Master System, the Genesis, through raw processing power alone, was able to deliver that promise to the home gamer, bringing everything but the stale odor of unwashed males and the mysteriously sticky floor of the arcade into the living room.
By the time the Genesis was tearing up the charts, Sega was comfortably under the umbrella of venture capitalist firm CSK with its founder, Isao Okawa, in the game developer’s plush CEO chair. Okawa allowed the creative teams virtual autonomy when it came to developing their games. As a result, the individual logos of Sonic Team and AM2 were nothing short of a seal of quality for loyal players, but they didn’t get much support from the marketing arm of the business.
While the 3-D virus spread throughout the gaming world, the 16-bit Genesis faired surprisingly well with a stable of 2-D games, some original, some franchise updates, but most clearly exhibiting the power of the Genesis. Likewise, the arcades reached a peak not seen since the early ’80s, in no small part due to pioneering visions like Sega’s Virtua series.
And yet, a slew of confusing hardware add-ons designed to prolong the lifespan of Genesis and perhaps bar the gate, kept the gaming giant from carving out a permanent niche on the console hardware scene. The 32x upgrade would supposedly enable the Genesis to harness the power of 32-bit architecture, but at over $150, was overpriced as an add-on, and since it required the Genesis console, failed in every respect as a standalone upgrade. Sega experienced similar problems with the CD-ROM player accessory. It was as if, for one brief moment, reveling in the success of a triumphant console, Sega was unable to let go, live up to their founding philosophy and charge ahead. Naturally gamers and developers alike appeared perplexed by Sega’s apparent lack of focus, and neither, accordingly, were willing to invest in the future of these half-baked hardware solutions.
It may seem like a long leap forward to 2001, but the events of Sega’s turbulent history are remarkably interchangeable. From the Master System to the Dreamcast, each of Sega’s forays into home-based game hardware has failed, or fallen prey to one fatal misstep or another. And yet throughout its storied, often turbulent history, Sega has held true to the promise of making playable, boundary-pushing games. The short lives of its home consoles were shored up by the developer’s one saving grace: incredibly playable franchises, delicately woven throughout its home and arcade catalogues – though even magnificent conversions of Virtua Fighter 2 and House of the Dead 2 only had so much mileage in them.
The new millennium marked a harsh return to the cutthroat marketing paradigm established all those years ago by the founding fathers. Sega’s hardware was taken out into a field and shot, so the company could move toward a platform-agnostic software future. A brutal, yet lifesaving amputation that opened Sega’s real strength up to new markets. This was the chance for two decades of some of the industry’s most revered gaming franchises to live again on a new generation of game systems.
Naturally, it was in Sega’s best interests to play this hand as though it were a considered and beneficial decision (rather than a necessity), but the company was in serious debt, and even slicing itself in half wasn’t enough to retain buoyancy. Step in Isao Okawa , the mega-wealthy entrepreneur and chairman of the software developer’s parent company, CSK. Okawa gallantly gave up his stock shares in Sega (and other companies with an interest in Sega) to offset the company’s debts. This $700 million gesture came only weeks before the unexpected death of the Japanese businessman: a parting gift with the potential to re-launch the new “software-only” Sega as the world gaming power it once was.
The new hardware-less corporation rolled out its franchise wagon like never before, and while classics like Sonic and Out Run shifted units purely on the strength of their revered names, it was a far cry from the days when Sega was turning out these great titles from new.
Unfortunately, many of those classic games survived in name only, as the new Sega farmed out licenses to all and sundry in an attempt to regain its footing. With Okama no longer watching over the game giant, Sega rapidly began running out of breathing room, and its long reputation slipped, along with any last vestiges of brand loyalty from the gamers. CSK put Sega on the auction block in 2003, where Japanese amusement machine vendor Sammy , a corporation known for buying out struggling firms in an effort to squeeze out what remaining revenue may be left in them, bought controlling interest.
Although Sega has continued to work across the board, and has developed a great deal of consumer interest in the new generation of consoles and computers, a lot of what made Sega, Sega has suffered at the guillotine of corporate rationalization.
When Sega became the plaything of Sega Sammy Holdings in 2003, the second-party development teams were consolidated into just three factions (from the original eight), forcing the teams who’d functioned autonomously under Okawa to merge staff and mindsets. Even industry legend Sonic Team now only exists in name (with Yuji Naka breaking away to form his own development team just last year, which is admittedly close to, and partly funded by, Sega), while arcade pioneers AM2 repeatedly bang the same Virtua drum without any new rhythm. And by messing with the last thing that worked, the eight software development teams, Sega has drastically reduced its chances to succeed on the merits of its original franchises.
This isn’t to say Sega can’t turn it all around, but if they do, it’s going to need to be quick. There’s little room for yet another Virtua Fighter or an even faster Sonic, so we could soon see Sega drop yet another business model like a hot brick and charge toward a future without the franchises around which the company was built. If its former creative genius can be harnessed once again, the company’s vision of becoming the world’s leading developer might be a reality sooner than we could hope. Of course, once the solid foundations of Sega’s franchises begin to crumble, it might finally meet a challenge it can’t outrun.
Most everything about Sega is still in place: the names, the games, the business philosophy and the mistakes. Sega’s promise to focus on games has, to date, yielded little more than a slew of rehashed franchises and repackaged hits from its console and arcade catalogue. The brilliance and innovation have been slow in coming, and missteps like Full Auto and Shadow the Hedgehog have severely eroded the footing of a once-great giant. Where the name, nay the word, “Sega” once represented brilliance, it risks now becoming an empty slug line; reminiscent of something which used to be great, reduced to the role of minor publisher in an industry which has largely moved on.
Spanner has written articles for several publications, including Retro Gamer. He is a self-proclaimed horror junkie, with a deep appreciation for all things Romero.