Announcement

Collapse
No announcement yet.

Sammy: Sega has betrayed and embarrassed us

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Sammy: Sega has betrayed and embarrassed us

    Oh dear... Sega really is the Homer Simpson of the games industry. I think my cat could run a business better than them.


    The Asahi Shimbun
    The Asahi Shimbun is widely regarded for its journalism as the most respected daily newspaper in Japan. The English version offers selected articles from the vernacular Asahi Shimbun, as well as extensive coverage of cool Japan,focusing on manga, travel and other timely news



    Sega's choice of partner to rely heavily on shareholder CSK

    As Sega Corp. mulls which of two companies to forge a business alliance with, analysts say the key to a final decision may ultimately rest with the firm's top shareholder, CSK Corp.

    Officials at both Sega and CSK have said that they will choose a partner based on which company is better able to maximize the value of Sega's businesses.

    After announcing a plan to integrate its operations with pachinko and slot machine maker Sammy Corp. in February, Sega then said on April 17 that it was also considering a merger with game software maker Namco Ltd.

    Sega President Hideki Sato said in late April that the company would decide which firm to ally with by early May, to gain shareholder approval in June.

    Information services company CSK, which owns a 22 percent stake in Sega, played the role of middleman in the proposed partnership deal between the struggling game maker and Sammy.

    CSK had hoped that Sammy would help Sega improve its weak financial standing.

    After withdrawing from the home video game hardware business two years ago, Sega recorded dismal sales of its software in the United States in fiscal 2002, leaving the firm's turnaround plan in tatters.

    But despite its faltering business results, Sega's brand name, which is known the world over for its former success in the video game market, still appeals to potential partners.

    As a major shareholder, CSK suffered 68.6 billion yen in appraisal losses in its fiscal 2002 accounts settlement due to Sega's stagnating stocks.

    Sammy President Hajime Satomi was a close friend of the late Isao Okawa, CSK founder and former Sega chairman and president. For that reason, Satomi used to emphasize that Sega and Sammy were just like relatives.

    But when Sega officials announced last month they were considering a partnership proposal from Namco, Sammy officials were furious.

    The presidents of Sega and Sammy had agreed on their partnership and shaken hands on the deal in February.

    According to sources close to the companies, Sato met with Satomi shortly after Namco proposed a merger on April 14.

    When Sato told Satomi about the offer from a third party, it took him completely by surprise.

    ``(Sega) has betrayed and embarrassed us,'' a senior Sammy executive said. ``We don't really care (if the deal goes through or not) anymore.''

    Yet warning signs the partnership could fall through were evident even before Namco's merger plan came to light.

    In early March, it was revealed that Sega had received a partnership offer from Electronic Arts Inc., the largest game software maker in the United States.

    At the time, Sammy officials repeatedly said there would be no change in their planned integration with Sega.

    On the contrary, the plan has largely been put on hold. Sega and Sammy initially planned to work out integration details at the end of March and sign an official agreement in late May.

    Sega President Sato blames the delay primarily on the differences in operations between the two firms, with particular regard to the markets they work in and specific business practices.

    Such differences, Sato says, have delayed the process of evaluating the assets held by the two firms.

    While both Sega and Sammy operate under the law regulating entertainment businesses, the provisions that apply to the two firms differ due to differences in their mainstay operations. While Sega's main businesses are video arcade games and home-use video game software, Sammy's bread and butter is producing pachinko and slot machines.

    Namco claims that Sega needs a partner with similar operations. The company has demanded that a merger take place on Oct. 1, the same date Sammy wants to integrate its operations with Sega.

    ``We have to do something, or Sega will go under,'' a Namco official said. ``Namco is Sega's best partner because we are in the same industry.''

    The company has been in talks with Sega since last year, and integration of operations was on the agenda from the start. Sega, however, told Namco it would put an end to negotiations just prior to it announcing its integration plan with Sammy in February.

    ``At that time, we didn't know what was going on. But Sega has apparently come back to the negotiation table after seeing its stocks fall,'' a senior Namco executive said. ``We are serious about this and we wouldn't even mind Sega acquiring us.''(IHT/Asahi: May 1,2003)

    #2
    We had a debate about this on Virtua Fighter.com and I knew in my gut that Sega shopping itself around would infuriate Sammy. The thing is Sega needs somebody, but they always manage to shoot themselves in the foot before the deal goes down.

    I guess the bright side is if they merge with Namco, Namco can finally make good fighting games. I think I could run Sega better.

    Truth be told it was the competing head to head with EA and then supporting Xbox with exclusives, while PS2 ate up market share, hurt them the most. But what do I know I'm not a Sega exec.

    Comment


      #3
      Things are looking genuinely grim for Sega these days.

      I wonder how big of a chance there could be that Sega could in fact go under...

      Could you imagine a world without Sega?

      Comment


        #4
        Well done Sega.

        They've pissed off their ticket out of their mess.

        If they merge with Namco, they will go under pretty sharpish unless massive cut-backs are made.

        If they merge with EA, there's a chance that EA will try and change the way their dev teams work.

        But Sammy were a perfect partner in my view - Financially secure, Japanese and passionate. What a waste of a great opportunity.

        Comment


          #5
          Welcome to the next level.. of management idiocy. As Burai says, Sammy were their last chance. Maybe, somehow, CSK can patch things up with them and Sega can kiss some ass.

          Comment


            #6
            A lot of Japanese developers are in a financial mess, just look at Capcom. A Sega/Namco merger would mean complete dominance of the arcade sector (which is considerable in Japan) and some of the strongest, most recognisable franchises under one roof.

            I'm all for it, both companies have such a beautiful heritage and i'd love to see collaborations between the two. I wouldn't mind a Sammy merger as their resources are considerable but as a romantic i'd rather see Namco in bed with Sega. Such a third party would also be very influential, hell even when seperate Nintendo trust both with two of their most important franchises.

            Take Namco's development teams, give them recognisable names like Sega did with their's and call the company Sega Namco (with the usual fonts, Sega-AM2 style).

            Comment


              #7
              Sega Namco would be the greatest thing ever, except that both companies are ****ed and the only thing that can come from two ****ed companies merging is the receivers.

              We'd see about 5 games and the whole thing would go tits-up. A waste.

              The romantic in me is all for it, but Sega don't have many chances left and if worst comes to the worst I'd rather see them become part of EA or Microsoft than completely go under.

              Comment


                #8
                The difference between Sega and capcom is where they were hit by slow sales and the real estate marketing collapsing, all in the same quarter, Sega has been snatching defeat from the jaws of victory for well over a decade.

                There will be no such company as Sega Namco if this deal goes through. It's a leveraged buyout not a merger, at most Namco would survive only as a label imprint in the same way we still see the name "Atari" slapped on games today. They'd double up on their studios, have to fire a whole lot of people to eliminate overlap, and take on a crippling debt to pay for Namco.

                Sammy should just take their bundle of money elsewhere, at the first sign of Sega's typical schizophrenia I would have called a meeting of Sega & CSK's board's and asked them to choose a partner right now. If they flopped around at all, like they have been, I would have walked away from the deal there & then.

                Sammy should have been on the phone with Konami or Capcom at the first sign of trouble, offering their substantial cash horde and strong management team as reasons why accepting a buyout would be mutually beneficial.

                Sammy instead hung about too long hoping it would all work out and now Sega has made them look like a bunch of idiots. In Japanese business culture, it would have been more favourable for Sammy's image if Sega had just murdered Sammy's CEO in a public place.

                Sega's management team should be flayed alive, they've run a solid company into the ground too many times, and now even CSK don't want to touch them with a 50 foot pole.

                They remind me of Apple Computer up until 1997, creative as hell but with chimpanzees in the board room. Men so interested in selling the company that they don't know how to run the company.

                Comment


                  #9
                  Originally posted by Burai
                  The romantic in me is all for it, but Sega don't have many chances left and if worst comes to the worst I'd rather see them become part of EA or Microsoft than completely go under.
                  I'd rather them go quietly in their sleep than become Microsoft's bitch myself.

                  Comment


                    #10
                    I want to see Sega Merge with Namco then Nintendo buy them both and make Gamecube look super strong and then snap up Konami and Capcom and then suddenly Sony and Microsoft got very weak support from Japan.

                    Comment

                    Working...
                    X