SEGA's downsizing

Odo

Well-Known Member
#1
http://www.gamespot.com/articles/sega-to-axe-300-jobs-as-focus-turns-to-pc-and-mobi/1100-6424996/

Thoughts on SEGA downsizing?

I know that Sonic Boom wasn't the only big title of 2014 and they may have started doing this "re-engineering" before or during Sonic Boom project, but nothing makes me believe that Sonic Boom can't be blamed at all.

There was that team crisis during Sonic Boom project and this game ended being really embarrassing.

They say they're moving to digital only and mobile. On iPad, for example, you can find some of the most popular SEGA games: Total War titles, Football Manager and Sonic titles, but I don't know how much it's profitable in comparison to Nintendo consoles titles for example.

I heard that Phantasy Star Online 2 is a solid SEGA game as well, but even when SEGA is affirming that its PC and mobile digital division is favourable, the way they're downsizing is kind of worrying. I wonder if SEGA could became as irrelevant and embarrassing as the latest Sonic games.



http://toucharcade.com/2015/01/30/sega-shutting-down-flagship-san-francisco-office/

It's a sad state of things that in the last few years the words that often follow "Sega" in headlines are "Shuts down" or "Shutting down," but, here we are. You may rememberback in 2012 Sega shut down both their European and Australian offices to "focus on digital." Well, now in 2015, they're shutting down their San Francisco office to relocate to Southern California, axe anywhere between 120-300 jobs, and focus on "smartphone and PC online gaming."
 

mattavelle1

IT’S GOT A DEATH RAY!
Moderator
#2
http://www.gamespot.com/articles/sega-to-axe-300-jobs-as-focus-turns-to-pc-and-mobi/1100-6424996/

Thoughts on SEGA downsizing?

I know that Sonic Boom wasn't the only big title of 2014 and they may have started doing this "re-engineering" before or during Sonic Boom project, but nothing makes me believe that Sonic Boom can't be blamed at all.

There was that team crisis during Sonic Boom project and this game ended being really embarrassing.

They say they're moving to digital only and mobile. On iPad, for example, you can find some of the most popular SEGA games: Total War titles, Football Manager and Sonic titles, but I don't know how much it's profitable in comparison to Nintendo consoles titles for example.

I heard that Phantasy Star Online 2 is a solid SEGA game as well, but even when SEGA is affirming that its PC and mobile digital division is favourable, the way they're downsizing is kind of worrying. I wonder if SEGA could became as irrelevant and embarrassing as the latest Sonic games.



http://toucharcade.com/2015/01/30/sega-shutting-down-flagship-san-francisco-office/

It's a sad state of things that in the last few years the words that often follow "Sega" in headlines are "Shuts down" or "Shutting down," but, here we are. You may rememberback in 2012 Sega shut down both their European and Australian offices to "focus on digital." Well, now in 2015, they're shutting down their San Francisco office to relocate to Southern California, axe anywhere between 120-300 jobs, and focus on "smartphone and PC online gaming."
Actually this could be really interesting. They are going PC and Mobil digital download only.

@Ex-Actarus has made claims that this is the way Nintendo should go, especially for Mobil.

So if they clime outta the hole using this format then maybe it is a viable solution for other company's.

If not tho I guess your pretty well on your way out forever. Will be interesting to watch.
 

EvilTw1n

Even my henchmen think I'm crazy.
Moderator
#3
The corporate euphemisms kill me. "Around 300 staff are scheduled to be made redundant." Fired. Going to be fired. Telling someone "your job is no longer going to be needed in our company" is a long way of saying "you don't work here."

That aside, it seems like Sega is trying to stay ahead of the curve; they're making this move while they're still making a profit, just not the same level of profit. If they want to stay in the game-making business, they'll have to have cleverer management than when they were in the console-making business. Seems they just don't think they can stay solvent doing what they've been doing in recent years.

So it goes.
 

Cyan

Well-Known Member
#4
Damn... I guess there will be no more rolling around at the speed of sound for them...

Sega is a shell of it's former self anyway...

Maybe if they're a Japanese only company for a bit they'll return to doing the good shit...
 

Cubits

Well-Known Member
#6
Hey, they could still be producing eshop stuff, right? I mean, games like child of light which are too risky for retail according to traditional publishers might be right up sega's alley. They could establish themselves in the growing niche between megabucks titles and indies (which nintendo resides at the top end of).

Just because they're going digital only doesn't mean they're gone from consoles per se. And maybe sonic games work better as smaller ideas anyway.
 

Koenig

The Architect
#7
In regards to both publishing and development Sega is a shell of its former self. I really want to see them recover (More specifically I want to have fun playing their games again) However I can't help but feel that downsizing is the only way they can recover at this point. Hopefully they can clean themselves up a bit and return to a larger scale in due time.
 

Juegos

All mods go to heaven.
Moderator
#8
I don't really care that much for SEGA these days. They rarely make anything notorious, besides having their name attached to two Bayonetta games in a span of, what, 5 years?

That said, I think what Cubits noted would be the best, for SEGA to focus on filling that middle market where small and cheap ideas meet established franchises. There's no need for AAA Sonic.
 

mattavelle1

IT’S GOT A DEATH RAY!
Moderator
#9
I don't really care that much for SEGA these days. They rarely make anything notorious, besides having their name attached to two Bayonetta games in a span of, what, 5 years?

That said, I think what Cubits noted would be the best, for SEGA to focus on filling that middle market where small and cheap ideas meet established franchises. There's no need for AAA Sonic.
For me it's not just these days, I've never cared for them ever.
 

Laer_HeiSeiRyuu

Well-Known Member
#10

Laer_HeiSeiRyuu

Well-Known Member
#11
The corporate euphemisms kill me. "Around 300 staff are scheduled to be made redundant." Fired. Going to be fired. Telling someone "your job is no longer going to be needed in our company" is a long way of saying "you don't work here."

That aside, it seems like Sega is trying to stay ahead of the curve; they're making this move while they're still making a profit, just not the same level of profit. If they want to stay in the game-making business, they'll have to have cleverer management than when they were in the console-making business. Seems they just don't think they can stay solvent doing what they've been doing in recent years.

So it goes.
SEGA hasnt made a profit in years dude.
 

Goodtwin

Well-Known Member
#12
Last ditch effort to survive. I have had to argue against Nintendo going this route over at Beyond3D for a long time, but somebody yesterday actually tried to use this as an example of a "big" publisher going that route. If anyone thinkgs that Sega is a premier publisher right now, they are out of their mind, and the notion that this move to mobile and digital is anything other than a last ditch desperation move, your also mistaken. They are knocking on deaths door, haven published a critically acclaimed game in quite some time, and commercial successes have been just as hard to find.

Heres what I know for certain, if Sega isnt including home consoles with their digital ventures, then they are as good as dead right now. Games like Sonic 4 episode 1 & 2 did pretty well on the consoles, and I believe that these types of games could do well in the future. HD remasters of old games could also have potential. It will be interesting to watch, but if I had to put money on it, I could bet Sega is a dead company by 2020.
 

Koenig

The Architect
#13
If worse comes to worse, I only hope that their competent employees and IP's fall into better hands. Hopefully Sega can pull themselves around before that happens though, but they will need to first re-learn about quality before that happens.
 

Odo

Well-Known Member
#14
Hey, they could still be producing eshop stuff, right? I mean, games like child of light which are too risky for retail according to traditional publishers might be right up sega's alley. They could establish themselves in the growing niche between megabucks titles and indies (which nintendo resides at the top end of).

Just because they're going digital only doesn't mean they're gone from consoles per se. And maybe sonic games work better as smaller ideas anyway.

I think they're moving on from disc releases, but yes they may keep releasing mid-level games for eShop. In Japan, for sure.

But in the West I think they will be heavily focused on mobile and Steam.
 

Odo

Well-Known Member
#16
Steam is just a platform, exactly the same as on consoles. It has no bearing on the types of game.
Yes, this is true. The hard thing is making the developers think this way. Today just because you said proudly that you're going to be mobile-only, your company value instantly increases. It's like a spell.

When SEGA says that they're going to be mobile focused, it's like they're trying to be cool and smart.

But with games like Sonic Boom, I can't see any chance of success anywhere.
 
#17
If you ask me, they are going down this road just because they want to. We all know that Sonic is their biggest franchise and they could have delivered quality games in the last several years if they'd just put that extra effort and care into it. The same applies for pretty much all their franchises that they just seem to have forgotten about. Instead they gave us Sonic Boom...

It's really a shame for those that have been laid off. I hope they find a new job fast. And I hope all of this teaches SEGA something about putting their best effort into making a game, respecting their franchises and, of course, the fans.
 

Ex-Actarus

Well-Known Member
#19
Actually this could be really interesting. They are going PC and Mobil digital download only.

@Ex-Actarus has made claims that this is the way Nintendo should go, especially for Mobil.

So if they clime outta the hole using this format then maybe it is a viable solution for other company's.

If not tho I guess your pretty well on your way out forever. Will be interesting to watch.
Actually what I meant for Nintendo was to take advantage of the mobile market potential ; but NOT at the expense of their traditional business as Sega is doing...

Maybe now it's the right time for Nintendo to make a move on Sega and get Atlus at the same time. Man, with both companies this would definitely help Nintendo for their next consoles.
 

mattavelle1

IT’S GOT A DEATH RAY!
Moderator
#20
Actually what I meant for Nintendo was to take advantage of the mobile market potential ; but NOT at the expense of their traditional business as Sega is doing...

Maybe now it's the right time for Nintendo to make a move on Sega and get Atlus at the same time. Man, with both companies this would definitely help Nintendo for their next consoles.
I'm a fan of neither company so it wouldn't make me none one way or another.
 

theMightyME

Owner of The Total Screen
#22
ive said for a long time that nintendo should buy sega, and then fire all the business side and absorb the talent and IPs... Sega has the worst management. Who the hell thought sonic boom was a good idea ..."hey guys, i know that we have the inhouse team that knows sonic best... but how about we hire a far more expensive western team that couldnt give a shit about the franchise, and has no experience in that kind of game"
 

Odo

Well-Known Member
#23
Some SEGA figures.

I didn't know about Football Manager. It's a popular SEGA title but it seems like it's in decline. Alien wasn't that bad, but Sonic Boom was poor and SEGA expectations is lower than a million sales for any platform except 3DS.

http://www.nintendolife.com/news/20...explode_as_sega_clarifies_restructuring_plans
http://www.gamespot.com/articles/sega-s-big-bet-on-console-games-falls-short/1100-6425252/

For the nine months between April and December, Sega spent $210 million on games development, representing a 27 percent increase compared to the year prior. Meanwhile, its advertising expenses climbed 53 percent, up to $73 million.

This major push will result in the release of 50 games by the end of the financial year in March, but combined sales of all those are expected to be about 5.4 million units--a figure that is eclipsed, singlehandedly, by the best selling games from rival publishers.


Alien: Isolation

was the best new performer, with 1.76 million sales

The Football Manager

series appears to be in decline,

latest edition (released in November): 640,000 sales.
previous edition: 790,000 sales
2013 edition: broke records with 940,000 sales.

Sonic Boom for Wii U and 3DS

together: 490,000 units.


Sonic Lost World for Wii U and 3DS

together: 640,000 units in an equivalent time frame in late 2013

Forecasts - Full year expectation

Wii U 230,000 (down from 300,000)
3DS 1,160,000
PS3 960,000
PS4 920,000
Xbox 360 240,000
Xbox One 420,000

Three-quarter period numbers

Revenue: $685 million
Profit: $18 million
 
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Ex-Actarus

Well-Known Member
#24
@Odo , those are just numbers for Sega franchises. So does Sega keeps Sega and Atlus numbers separated in their financial reports ? So I guess Atlus and Sega haven't been merged...

Anyway, Sega REALLY needs to take a decision on Sonic. They say they want to make more money on merchandising related to Sonic, but if they keep bringing bad games like Sonic Boom, it won't help the brand.
 

Odo

Well-Known Member
#25
I think Sega and Atlus didn't merged and I hope they never do. I don't have Atlus numbers, but I believe they're going well.
 

Odo

Well-Known Member
#31
http://www.gamesindustry.biz/articles/2015-02-23-is-sega-the-next-atari

Former Sega of America CEO Tom Kalinske bemoans 20 years of wrong decisions from the Sonic maker, weighs in on whether Nintendo should go mobile



Read this:


"One of the key reasons why I left Sega is when we had the opportunity to work with Sony, when [Sony Interactive CEO] Olaf Olafsson, [Sony Corporation of America president and CEO] Mickey Schulhof and I had agreed we were going to do one platform, share the development cost of it, share the probable loss for a couple years on it, but each benefit from the software we could bring to that platform. Of course, in those days, we were much better at software than they were, so I saw this as a huge win. We went to Sony and they agreed, 'Great idea.' Whether we called it Sega-Sony or Sony-Sega, who cared? We go to Sega and the board turned it down, which I thought was the stupidest decision ever made in the history of business. And from that moment on, I didn't feel they were capable of making the correct decisions in Japan any longer."
 

Odo

Well-Known Member
#33
I wouldn't enjoy it, but I agree, they're following the very strategy they shared: a mobile approach.
 
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