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Forums - Gaming Discussion - The Biggest Reason Sega became a software-only company was Isao Okawa

liquidninja on 13 September 2009

It wasn't as much competition from Sony, Microsoft, Nintendo or even all the money they lost on the Saturn and Dreamcast as much as it was SEGA's chairman who wanted SEGA to be a software-only company going all the way back to 1997.

I first herd about it in this really recent interview with Bernie Stolar (former SEGA president) who said:

“When [former Sega President Hayao] Nakayama was pushed out and when I was pushed out, I think what took place was, Mr. [Isao] Okawa, who then became the chairman of the company -- he was an investment banker from CSK [Holdings Corporation].... I don’t believe he was committed to the hardware. He just believed it should be a software company.”

I later found some quotes of his in a The New York Times article:

In a recent interview with the Yomiuri Shimbun, Mr. Okawa said the company was likely to abandon the hardware business altogether. ''I have worked in software all my life, and I feel uncomfortable being in the hardware business,'' he told the newspaper. ''In fact, when I became chairman of Sega in 1997, I said we should stop producing hardware.''

I also found these quotes on The Register who got them from GamerIntelligence:

"I will say that the future doesn't necessarily lie in the hardware business," said Okawa. "I think in the future there is the possibility of Sega becoming a software-only company... "Even if Dreamcast does sell, we will make that shift."


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ChichiriMuyo on 13 September 2009

But you have to remember, they put Okawa in charge specifically because how badly they had bungled the hardware side of the business, so really it was because of how badly the Saturn did. The Dreamcast, however, did not actually do badly for them.



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mike_intellivision on 13 September 2009

Sega was never been a hardware leader. Only the Genesis/Mega Drive sold reasonably well -- and Sega kept making strange add-ons for that system.

By 1997, the Saturn was already buried by the Playstation. And Sega of America had botched the launch to the point that some stores would not even carry the console.

So of course getting out of the hardware business was something that being considered.

Mike from Morgantown



      


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liquidninja on 14 September 2009

You know I think you guy are right. I jumped on the bandwagon too soon there.

I just read: "Tom Kalinske: American Samurai" and it seem like Sega ignored him despite his decisions bringing the company to 55% market share in the US and kept making bad decisions until he finally left the company in 1996.

Here's kinda a summary they made:

  • 1995: Sega of Japan decides to discontinue the Genesis in the U.S. and Europe, ignoring the installed user base of almost 30 million units the console has worldwide.
  • Sega of Japan then ignores everything that Kalinske has done for the company and strips him of all control, reducing him to a mere figurehead.
  • Sega of Japan rushes the Saturn's launch, leaving it without software for months and pissing off retailers and 3rd party licensees in the process. Most of them flock to Sony.
  • 1996: Tom Kalinske resigns (taking a lot of the staff with him, including the company's founder - David Rosen) Bernie Stolar is hired to succeed him.
  • Sometime in Late 1996: Sega of Japan cancels the one big name title that could have helped the Saturn - Sonic X-treme.
  • 1997: Bernie Stolar infuriates the few 3rd party companies left (most notably Working Designs) and reveals that July that the Saturn was no longer Sega's future and had been "stillborn." Moreover, his five-star policy tightens the noose around the Saturn's neck and leaves most of the great software in Japan.


Mr Khan on 14 September 2009
liquidninja said:

You know I think you guy are right. I jumped on the bandwagon too soon there.

I just read: "Tom Kalinske: American Samurai" and it seem like Sega ignored him despite his decisions bringing the company to 55% market share in the US and kept making bad decisions until he finally left the company in 1996.

Here's kinda a summary they made:

  • 1995: Sega of Japan decides to discontinue the Genesis in the U.S. and Europe, ignoring the installed user base of almost 30 million units the console has worldwide.
  • Sega of Japan then ignores everything that Kalinske has done for the company and strips him of all control, reducing him to a mere figurehead.
  • Sega of Japan rushes the Saturn's launch, leaving it without software for months and pissing off retailers and 3rd party licensees in the process. Most of them flock to Sony.
  • 1996: Tom Kalinske resigns (taking a lot of the staff with him, including the company's founder - David Rosen) Bernie Stolar is hired to succeed him.
  • Sometime in Late 1996: Sega of Japan cancels the one big name title that could have helped the Saturn - Sonic X-treme.
  • 1997: Bernie Stolar infuriates the few 3rd party companies left (most notably Working Designs) and reveals that July that the Saturn was no longer Sega's future and had been "stillborn." Moreover, his five-star policy tightens the noose around the Saturn's neck and leaves most of the great software in Japan.

He refused to bring over Japanese software that he felt wasn't worth the localization, then?

 

Sounds familiar....



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