Official from SOA: Sega Out of Hardware Business

Official from SOA: Sega Out of Hardware Business

by January 31, 2001

From IGN Dreamcast:

After months of denial, the house that Sonic built decided to follow suit, confirming what many thought to be unthinkable: Sega of America is calling it quits in the hardware business, and as part of their plans to completely wash their hands of that side of the business, they are dropping the price of the Dreamcast to $99.95 US as of February 4th, 2001.

In addition to the price drop, Sega will be offering a number of incentive plans to retailers to help move the excess stock, though details were unavailable at press. Sega manager of marketing communications Heather Hawkins stated, “We’ll continue to support the hardware through December 31st, as we anticipate some hardware will still be in retail at that time, but we’ll no longer be holding inventory as of March 31st.”

As reported earlier this week, Sega will be re-focusing its hardware efforts, and will look to license Dreamcast technology to outside hardware manufacturers. While Pace Micro Technology was the first such partner to be announced by Sega, VP of Corporate and Marketing Communications Charles Bellfield did not rule out the possibility of other agreements entering the picture, “Pace is going to be a key partner for us, the main one, but we’re looking at other opportunities for the technology, obviously.”

As hinted at by multiple announcements from Sega of Japan, the company will now approach a new focus as a publisher. This multi-platform strategy, dubbed “platform agnostic,” will mean that from this point forward Sega will now be openly and aggressively developing content across all platforms in an attempt to become the world’s leading game publisher.

Hawkins sees the position as the best route for Sega, stating, “Being platform agnostic means that we will have the opportunity to look at all platforms to determine which one will be the best fit for our content, both from a development/technical side and a demographic one, meaning we won’t have to determine the feature set of a title by what by the constraints of any particular system.”

On that note, Sega has announced several titles already in production for other platforms, most notably Yu Suzuki’s upcoming sequel to the popular Virtua Fighter Series, Virtua Fighter 4, which is being developed from the ground up as a PlayStation 2 exclusive for a Fall release. (Tristan’s note: We heard X-Box and not PS2…) Sega also confirmed that United Game Artists’ Space Channel 5 would make its way to PlayStation 2 from Sega later this year, as well as titles in the Sakura Wars and Let’s Make a Pro Sports Team series, though the latter 2 look unlikely for release in the States.

Sega finally confirmed the poorly-kept secret of their deal with Acclaim, and stated that the company will release Crazy Taxi, 18 Wheel American Pro Trucker and Zombie Revenge on the PlayStation 2 some time after April 2001.

Confirming statements made by Nintendo Co. Ltd.’s president Hiroshi Yamauchi earlier this week, Sega has revealed that they are working on multiple titles for Game Boy Advance, including Sonic the Hedgehog Advance, Chu Chu Rocket!, and Puyo Puyo. Sega officials also noted that while they made no announcements with regards to Microsoft’s Xbox or Nintendo’s other hardware effort, the upcoming Gamecube, they are currently in negotiations to provide content to both platforms, with more concrete information undoubtedly on the way.

Sources inside Sega also mentioned that the company is looking into bringing some classic Saturn titles to the original PlayStation, though no decisions have been made to that effect yet.

All hope is not lost for the Dreamcast platform, however. Bellfield explained that “We’re not giving up on Dreamcast. We’ll continue to support the platform well into the next 18 months, and beyond that, as long as it is profitable.” Now that Sega is moving out of the costly hardware business, this should prove to be a tricky proposition, as the system’s limited install base will undoubtedly limit sales potential for new software.