Sega used to be known as one of the top gaming companies in the world, known for classic gaming consoles like the Sega Master System, Sega Genesis, Sega Saturn and Sega Dreamcast. Then in March 2001, despite recent success with the Dreamcast, Sega announced it would leave the hardware business to focus on software.
Today, however, the company seems to have dropped out of people's minds despite the iconic status of characters like Sonic the Hedgehog. But could we ever see a comeback from Sega?
According to ex-Sega chief executive Tom Kalinske, Sega has a chance to avoid going the same direction of Atari, which filed for bankruptcy in early 2013. Kalinske suggests that Sega has an opportunity to make a comeback, especially with its best-known and most loved characters, including, or course, Sonic.
"You have to really make a lot of mistakes to kill a strong brand," said Kalinske. "I do think some great brands obviously have been destroyed, Atari being one of them. Why didn't that survive? I think there's a lot of bad decision making involved in killing brands like that. I hope Sega isn't the same thing."
It's not just Kalinske that thinks it's time for Sega to make a comeback. Last week, the company announced the acquisition of Demiurge Studios, one of the co-developers who helped work on games like BioShock and Mass Effect. Sega also announced investments in Ignite Artists and Space Ape Games, which are studios largely known for their mobile offerings.
Not only that, but the company also invested $26.6 million in 2013 to purchase Relic Entertainment, as well as the Company of Heroes franchise. It also announced that it would be focusing heavily on mobile and PC games going forward.
This announcement seems to be a good one for the company. In a console market that is absolutely dominated by the likes of Sony, Microsoft, and to an extent Nintendo (which still dominates the handheld console market with its Nintendo 3DS), it would be unwise for the company to attempt to rebrand itself as a console maker.
It is certainly possible for the company to make a comeback through software, especially given its past. The company has already released Sonic The Hedgehog games on Android and iOS, which is a great first step. It would be wise for the company to continue to develop high-quality games using Sonic.
Having purchased some world-class developers, however, the company has a shot at building some really great games and completely reestablishing itself as a premiere game maker, perhaps by resurrecting older legacy franchises like Shenmue,
There's some parallel to be drawn between Sega from 20 years ago and Nintendo today. Many experts are calling for Nintendo to get out of the console industry and focus on its software efforts. Now that it seems as though Sega is finally refocusing its efforts on games rather than consoles, it will be interesting to see whether Nintendo ends up doing the same.
Kalinske weighs in on Nintendo in the same interview: "I don't think [Nintendo] should give up hardware or consoles. ... I don't think they should give up what they're doing because they're damn good at it."
Only time will tell if Sega is able to make a successful comeback, however with great developers and iconic characters on its side, it certainly seems as though it could.
