2 SR12

Segagaga, Sega Gaga, SGGG, Sega Simulation, whatever name you
prefer, it all refers to the same game. A simulation game released for
the Dreamcast back on 3.29.01 through Sega of Japan's online D-
Direct shop (it later saw a retail release in Japan on 5.31.01),
Segagaga is a business major's dream game. In the game you own
and operate Sega, taking control of all their important business
decisions. It's 2025 and the company only has 5% of the industry's
market share, so it's up to you to make the right decisions to bring
Sega to the top and monopolize the market.

Of course, it never saw release in America, but the concept of the
game got me thinking: "What if I had made all of Sega's business
decisions since they decided to enter the videogame hardware
market in the early 1980s?" The concept seems almost like a joke;
Sega knows that they've had more than their fair share of poor
business decisions, and this game pretty much says: "Here, we're
sick of having to do this. If you think you can do it better, why don't
you try and run the company?"

To which I gladly accept. I love Sega a lot. Their developers are the
best in the business. Their hardware was always innovative and
revolutionary. And at the end of the 16-bit era they sat atop the entire
industry, a cinderella story that overcame Nintendo's illegal monopoly
(for those unaware, during the 8-bit era Nintendo used it's monopoly
on the market to prevent third-party developers for making games for
the Sega Master System by basically forcing them to sign exclusive
development contracts), and was in the driver's seat to take over the
industry for good. Then, it all collapsed. Sega made a series of poor
business decisions that the industry (including third-party developers,
retailers, and mainstream gamers) never forgave them for, decisions
that ultimately resulted in their pitiful bow out of the hardware
market.

But Sega's poor business decisions after the 16-bit era weren't
anything new. In fact, Sega had a long history of such decisions,
somehow overcame them, and then screwed up for good. I'm going to
offer a quick recap of Sega's biggest blunders (there are many small
ones too, but we won't get into that now), detailing the effects they
had on Sega's reputation and success, and then tell you what I would
have done if I would have been in charge.

What ultimately led to Sega's downfall was their illogical desire to
release new systems faster than the market demanded. It actually
began back in 1983 in Japan with the release of their first system, the
SG-1000. The system saw limited success, and for some reason Sega
decided to release two upgrades, as well as a computer version
(which later saw its own upgrade), all before 1986. That's five
consoles in less than three years! One of these, the Mark III, would
later be redesigned as the Master System for release in other
markets, a system that was popular in Europe and South America, but
performed horrendously in Japan and in North America. A lot of this
was because of Nintendo's monopoly, but Sega screwed up big time
themselves in America by signing away the console to Tonka, hoping
Tonka would market the console to success. Well, that turned out to
be a disaster, and it wasn't until Sega got the rights back to the
console (after the Genesis launch) that the console gained popularity.
Which leads right into another blunder. Pushing support for the 8-bit
SMS when you already have a 16-bit system on the market. They
should have focused more on courting third-party developers to the
Genesis, though, to their credit, in a few years the Genesis was still at
the top of the market, running neck and neck with Nintendo's SNES.

Which brings me right into the Genesis. Released in 1989, the Genesis
eventually rode to dominance behind Sega's aggressive marketing
campaign and great arcade conversions (it was one of the few
consoles that actually ran a full life-cycle, 1989-1997). Here is when
Sega went out of control. Fearing the possibility of not having the
most technologically superior hardware on the market, Sega released
the Game Gear in 1991, the Sega CD in 1992, the 32X in 1994, and the
Nomad and Saturn in 1995. That's a total of six consoles in six years!
Thus, Sega lost trust with customers, retailers, and third-party
developers and spelled the doom of the Saturn and Dreamcast before
they were even released. It was hard to watch Sega fall from the top.
They were in prime position to control the industry for decades to
come. Then they self-destructed, not because of poor hardware or
software, but because of poor decisions. It only makes me wonder
what could have been. All I know is that if I had been Sega's CEO,
they'd be ruling the industry right now.

Here's what I would have done:

First of all, I never would have released the SG-1000 and any of its
follow-ups. They were released during the industry crash of the early
1980s, a time when the market was flooded with too many systems
already. I still would have released the Master System to combat the
NES, but I would have abandoned the dual format of card and
cartridge, focusing on developing the card further. Of course, there
was obvious size limitations as the card could hold only half as much
data, but that's why I said "develop." The cards were smaller and
much cheaper to produce. And, since the Game Gear was based on
the Master System, Sega could have made the Game Gear a portable
Master System, using the smaller cards to decrease the size of the
handheld. Sega did release an add-on that enabled you to play your
SMS games on your Game Gear, a concept that is great in theory, but
the problem was that no one wanted to lug around an already
mammoth handheld with a giant add-on peripheral and a full-sized
cartridge. If they had developed the card format so that the SMS used
it instead of (and not along with) cartridges, Sega could have easily
made the Game Gear a portable SMS, thus encouraging developers to
make more games for the SMS. They also could have been able to
release the Game Gear a year or two earlier, a move that might have
given it hope for surviving Nintendo's Game Boy. I also never would
have signed off the console to Tonka for marketing in the crucial
American market, and would have fought Nintendo's monopoly more
assertively.

Now, on to the Genesis. Sega did a great job launching and marketing
the system, releasing excellent arcade ports and calling out
Nintendo's weaknesses in advertisements. Nevertheless, I would
have done a better job at courting third-party developers, such as
Square and Namco, and I never would have allowed the switch from
hard case boxes to cardboard boxes. Whoever decided that needs to
be pilloried. I also would have tried to release the Nomad a few years
earlier, and I actually would have marketed it. I never would have
released the Sega CD or the 32X. I know, the Sega CD was a great
system, but it was too soon. The Genesis was still going strong and
Sega needed to play it conservative, like Nintendo, and ride out the
16-bit era. If they would have done that they never would have
alienated their reputation with consumers, retailers, and developers,
and could have enjoyed massive profits from software sales. They
also wouldn't have scared Nintendo into thinking they had to release
a CD-based system as well. And for those of you who don't know the
history, Nintendo partnered with Sony to develop a CD-based system
to compete with the Sega CD. Nintendo eventually reneged on the
deal, but Sony, now interested in the industry, continued to develop
the prototype into what would eventually be Sega's nail-in-the-coffin,
the Playstation.

Since it's impossible to predict what would have happened if Sega
had never released the Sega CD or if Nintendo had never partnered
with Sony, so I'll just continue my CEO decisions as though Sony
entered the market with the Playstation in 1995. Now, since Sega
would still be milking the 16-bit market with Nintendo (and profiting
greatly), we would be in no rush to beat Sony, an unexperienced
gaming company to the 32-bit market. Instead, we would announce
our superior system, the Saturn, court third-party developers, and
wait to see what Sony had to offer. That way, we would have designed
the system architecture around the needs of the third-party
developers. Now, the Saturn was a great system, but it was too
complicated to develop for with its dual-processors and all. The
potential was there, but the developers didn't want to deal with it. So,
I would have ensured that the Saturn would have been easy to
develop for and was powerful enough for full 3D capabilities (for as
lame as it is that 2D got spurned at the 32-bit era, the market
demanded 3D games---Sony proved that). So, I would have released
the Saturn a few months after the Playstation launch of 9.9.95 (no
surprise launches here), ensuring a strong launch line-up and a
steady stream of titles thereafter. I also would have included four
controller ports (assuming I thought of it back then), launched with a
Sonic title; and I would have marketed the hell out of it, reminding
gamers that this is the company that gave them the Genesis. I feel
quite confident that with my ability to win the hearts of third-party
developers over, and with retailers and gamers already trusting the
company based on the Genesis era (and lack of a Sega CD or 32X era)
that the Saturn would have outsold the Playstation.

Now assuming the Saturn would have been a success, we would not
have had to design and release its successor, the Dreamcast until
roughly 2000. Now, Sega did everything right with the Dreamcast. But,
because of the later launch date, I would have had the luxury of
seeing the importance of broadband to online gaming. So, I would
have packed in a dual broadband and narrowband modem into the
system (I know it's expensive, but it needed to be done). I also would
have ensured that online gaming launched with the system,
demonstrating its true capabilities immediately, and required that
games include both narrowband and broadband support so as not to
alienate any potential users. I assume that I would have all the major
developers like Square and EA on board, based on the fact that I
didn't sever my relationships with them due to poor business
decisions. I would have continued to market the machine like crazy,
and I'm pretty confident, based on my previous business decisions,
that Sega would be the top company in the industry. And right now I'd
be deciding when to release the successor to the Dreamcast
(probably by Christmas 2006).

And that's what I would have done if Segagaga were real. It probably
would not have worked out as smoothly as I planned, but I can
guarantee that it wouldn't be 2025 with Sega controlling a mere 5% of
the market. In other words, if Segagaga were real, it wouldn't need to
exist because I'd have our market share maxed out at 100%.