Sega To Close Arcades, Cancel Games, Lay Off Employees

slugo writes with this excerpt from Wired: "The house that Sonic built is getting significantly smaller. Sega's Japanese main branch said Tuesday that it will close 110 arcades, cancel some games in development and seek to lay off 18 percent of its staff. ... Sega says it will chop 20 percent off its research-and-development budget for arcade and consumer games. The company plans to do this by 'consolidating titles to be developed' and 'enhancing the self-manufacture ratio.'"

Re:Sega had arcades?

[giostickninja]

Arcades are still alive and well in Japan, as I can attest from my recent trip there. I spent some time in a 7 floor arcade...one floor all UFO catchers, one floor all sticker booths (and mostly girls-only) with 5 for games. Expensive, though; the games used ¥100 coins; ~$1 at the exchange rate at the time.

Re:Sega and the decline of Sonic

[Anonymous Coward]

Sorry, but as far as I'm concerned they killed Sonic when they turned him into a monstrous, slow werewolf and killed everything that made Sonic good. Why should I have to play a slow, sub-par action game to get to the good, fast Sonic levels?

What else do these guys even make? It's kind of a shame to see them in such shape since they were a pioneer, but they need to make better decisions.

Sega will be publishing Aliens vs Predator 3, an Aliens RPG, and Alines: Colonial Marines (A pure Aliens FPS) all in 2010 (or possibly early 2011).

Respectively, the companies working on those are: Rebellion, Obsidian, Gearbox. You might know these companies for AvP 1, NWN2/MotB/KOTOR2 + former Black Isle stuff, and the Opposing Force mod to Half-Life 1 (plus some other games apparently).

The developers at Obsidian have said that Sega is an amazing publisher to work with, and given that game line-up (and the setting used), I think it's safe to assume Sega will be around for a while to come.

for the google impaired

[rednip]

Sticker booths [ecplaza.net], aka photo booths like the ones you'll see at the beach, but they seem to be bigger. UFO catcher [wikipedia.org] aka claw vending machines like the ones you'll see at walmart.

Bit of a black and white view

[Moraelin]

That's a bit of a black and white view. "X does it too" doesn't automatically make X equivalent, if the extent differs considerably. E.g., "Alice took a sick day too" doesn't make her equivalent to Wally who was sick half the year.

To go through your list:

[X] Hollywood does it

Hollywood makes plenty of new movies too, not just remakes and ports of the old ones. In fact, I don't think that remakes are that big a part of their income.

In fact, other than Lucas, I can't think of anyone whose main business for years was re-releasing the same 10 year old movies, to the extent that Sega did lately.

[X] The TV Networks do it

1. TV networks do show new stuff all the time. E.g., all the news and the sports, for some easy examples.

2. TV networks are hardly equivelent to a game development studio. They're far more akin to the retailer you buy Sega's games from, than to Sega itself.

3. TV networks have the saving grace that their stuff is perceived as being for free. So even old crap still feels like it costs nothing to watch. If anyone's business model was that you have to pay $60 per movie (which is what games are really like), or let's say per season of a series, you'd find that they depend a lot more on releasing new stuff.

So all things considered at best you make the point there that a whole different industry works differently.

The RIAA is still milking 30-year-old tunes

The RIAA, or more correctly the individual labels, get most of their income from new over-hyped albums, not from those 30 year old tunes. The fact that those are still available at discounted prices, doesn't mean that's all that any label does.

Book publishers do it

Book publishers release new books every day. Re-releasing old paperbacks at barely more than the cost of printing and distribution is hardly their main business model.

[X] Everyone trying to become the next facebook is doing it

1. I'm not sure how Facebook is even remotely comparable to a game development business.

2. Just like in the dot-com days, most startups in that line of business fail. They just burn through more and more venture capital, and never figure out how to make anyone pay for that mindless clone of another site... which also doesn't turn a profit. If any of them even tried to sell their service for the same price a game sells, they'd find their maket share drop to zero overnight.

So how's that a good idea for Sega? Should they too copy a failed business model and, umm, fail?

Akihabara

[Taulin]

I really hope they are not closing their arcade in Akihabara. All my friends are amazed when I describe how thriving the arcades are in Japan. The bigger ones are usually comprised of about three or four stories, each with a different genre or games (fighting, shooters, etc). They are always busy, and it is an amazing feeling I haven't seen since the old days of Aladin's Castle. This news really saddens me.

-Phil
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