| Joelcool7 said: I don't think Sega is still struggling with the loss of hardware. Sega is struggling to produce high end software. Sega did change when they lost hardware but the company has restructured. I am pretty confident this announcement is a preemptive move. Sega sees the next generation costs are going to be double to triple and Sega realized they simply cannot produce all the games they do now. Fact is Sega cannot afford to take risks if they are going to make the jump to the next generation. As for the whole relying on high end strong IP. THQ is establishing new high end IP to survive off of. This is not bad they are creating new properties focusing on high quality. Fact is Dev costs are simply going to be too high for developers to release software that isn't a sure thing. That means big budget high quality software and/or established software. I really hope Sega and other publishers release quality software for WiiU to offset costs of next generation Sony and Microsoft hardware. |
The problem with companies like SEGA or THQ, is that you can't "shrink" your way to profitability. That's not a viable business strategy. You have to make large investments in order to see long-term profits. Their problem is brand awareness. No one knows what SEGA does outside of Sonic, and Sonic isn't the IP stronghold it once was. It's faded heavily in relevance over the last few generations of consoles. SEGA left the hardware market because they felt their strength was in software, because making hardware wasn't profitable enough. But that hasn't worked out at all. SEGA has been shedding jobs and money incrementally ever since it cancelled the Dreamcast. Their whole strategy represents a failure to grow and maintain a strong brand and image. Nintendo has done an incredible job in those two areas. SEGA must just be run by a bunch of hacks.
