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Opinion: Sammy's plans may be the best way forward for Sega

Reading the headlines that followed the appointment of Sammy CEO Hajime Satomi as the new chairman of Sega last week, one might be forgiven for thinking that Satomi-san's stated intent was to disassemble the software giant entirely and move the staff of its prolific development studios to new jobs as Pachinko ball polishers for Sammy's massive gambling machine division. This, many publications and industry commentators stated knowingly, is the end of Sega.

This is hardly a new conclusion, since a number of writers have been claiming that Sammy's acquisition of Sega will be the downfall of the company as we know it ever since the 22 per cent share acquisition went through late last year. However, what is not clear is where this open hostility towards Sammy, and specifically towards Satomi-san, actually originates - a factor which is all the more confusing because when a merger between Sammy and Sega was originally announced in early 2003, it was welcomed with open arms by press and shareholders alike.

Admittedly, what eventually transpired was a hostile takeover by Sammy rather than a happy merger - but given that Sega's board was aware of, and by all accounts actually approved of, Sammy's purchase of former parent company CSK's shares well ahead of the fact, this has to be one of the least hostile "hostile take-overs" in business history. The exodus of key creative staff which was subsequently predicted has simply failed to materialise, although that hasn't stopped media sources from hinting darkly that it's sure to happen any minute now.

In fact, the bulk of the claims that Sammy plans to tear Sega's business apart seem to focus on a single set of statements from Satomi-san - who stated that he'd like to see Sega focusing more on arcade game development and working on Sammy's low-cost Atomiswave platform, which he believes has revenue potential in developing markets. Sega, it should be remembered, already operates a huge arcade game division - which is in fact the single most profitable part of the publisher's business, and often makes up for significant shortfalls in the home console publishing business. It's also worth noting that many of the company's best games originated on arcade platforms.

What Satomi has never suggested is that Sega should pull out of console development (although it's likely that he will demand that poorly performing divisions, such as the Sega Sports titles which compete directly with EA Sports rivals, be re-evaluated) or that it should scale back in its development of innovative or niche new products. Sammy itself, it should be remembered, has significant ambitions in the home console videogame market - and has enjoyed cult success with games like the stunningly imaginative 2D beat 'em up series Guilty Gear.

Last Spring, Sammy's courtship of Sega was viewed as the best thing that could happen to the publisher - as a cash-rich company like Sammy would give Sega the financial strength and management leadership to continue to develop and innovate in videogames. It's hard to see what's changed in the intervening months - and outside of a vocal sub-set of the Western game media, there seems to be a strong belief that the Sammy deal is still going to be good for Sega. Crucially, Sega's shareholders believe in the deal - shares in the publisher rose almost 2 per cent after Satomi's appointment as Chairman. Even if the media doesn't believe to quite that extent, Satomi and Sammy must be given the benefit of the doubt.

This editorial originally appeared in the Weekly Update, a free email news bulletin which is distributed to subscribers every Wednesday afternoon and features a round-up of the key headlines from the previous week, software charts, recruitment information and editorial opinion on key issues of the week.

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Rob Fahey avatar
Rob Fahey: Rob Fahey is a former editor of who spent several years living in Japan and probably still has a mint condition Dreamcast Samba de Amigo set.