Service Games: The Rise and Fall of SEGA by Sam Pettus

Author:Sam Pettus [Pettus, Sam]
Language: eng
Format: epub
Tags: vl-nfcompvg, Games, Video & Electronic
ISBN: 9781463578473
Google: KVtUlwEACAAJ
Amazon: 1494288354
Publisher: CreateSpace Independent Publishing Platform
Published: 2012-07-12T00:00:00+00:00

Nakayama's choice

Near the end of 1995, once it became apparent that the Sony PlayStation was poised to seize the lead in the 32-bit console sweepstakes, Sega CEO Hayao Nakayama made a decision that would shape the course of Sega's finances for years to come. He was the man in the big chair. It was his call, and his alone. Nobody else could make this decision for him. The aging Genesis could no longer hold its own against the superior software offerings of Nintendo and its Super NES. Both Sega CD and the 32X had effectively bombed, costing Sega millions of dollars in lost resources and revenue. Sega's handheld efforts (Game Gear, Nomad) and its educational venture (Pico) were going nowhere fast. Only the Saturn seemed to offer some hope of rescuing Sega's failing fortunes. It had done surprisingly well at launch in Japan, a market in which Sega had never taken the lead before. Saturn had floundered in the U.S. against the PlayStation, but there was still time for it to make a comeback. Most voices within the videogame industry agreed that 1996 would be the critical year in the second great console war. Sega still had an outside chance of winning, but only if it focused its resources instead of spreading them across multiple systems. With these and many other factors in mind concerning Sega's current financial standing and flagging fortunes, Nakayama made a fateful choice that would forever shape Sega's destiny. In October of 1995, Nakayama made the decision to put all of Sega's eggs into one basket. Sega announced that it was cancelling all of its other consumer systems and focusing exclusively on the Saturn. Sega's 32-bitter would be the company's flagship console from now on.

There is one question that has dogged Sega loyalists concerning the Saturn and its misfortunes, and it is this: did Nakayama make the right choice in backing the Saturn as Sega's sole console? The answer is not as easy as it may seem, and one must put aside the wisdom that inevitably comes with hindsight and try to see things as he saw them during that time. Sega's arcade divisions were still going strong, but its console sales were floundering against both Nintendo and Sony. That was an ever-worsening load on Sega's bank accounts that was causing the company's profit margins to begin an inexorable slide downward. Nakayama couldn't just sit around and let Sega get clobbered one piece at a time, wielding multiple systems against better financed rivals whose product lines were considerably narrower. He had to make a choice, and Saturn was the row he chose for Sega to hoe. The 32-bit market had not quite yet gained its momentum, but all the signs were there that it was coming fast. Whoever took the lead in 1996 would win the second great console war, barring none. Sega simply did not have the ready cash and company resources of a multimillion dollar international conglomerate like Sony to continue as it was doing.

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