Interview with the head of SEGA
Translation from NeoGAF forums
So what's SEGA up to these days? After the Dreamcast flopped, it got quiet around the japanese company. By now they are attempting a comeback as a videogame publisher. Hajime Satomi, 64, the company's head and billionaire talked to SPIEGEL ONLINE about his expansion plans and his own game experiences.
SPIEGEL ONLINE: Mr Satomi, different from competitors like Ubisoft, Activision and most of all Electronic Arts did SEGA have almost no smash hits in the videogame charts recently. One could get the impression that your brand's best times are over.
SATOMI: They are still ahead of us. We want to be the no.3 among the game publishers on the world wide market by 2010. If things go bad, we'd be happy with rank 5.
SPIEGEL ONLINE: But - how is that supposed to be possible?
SATOMI: Today, we are already no.8 worldwide. Our competitors on rank 3, 4 or 5 really aren't all that far apart from each other. We can do it. Overwhelmingly strong is only Electronic Arts. Just let me say it this way: In the longterm, we want to get close enough so that we can see their back right in front of us.
SPIEGEL ONLINE: That seems hardly possible just with a steady stream of reincarnations of your classic "Sonic The Hedgehog".
SATOMI: We're trying a dual path: On the one had do we put a lot of energy into the development of new, proprietary franchises and accept low profit margins due to the costs. On the other hand did we focus on expanding by buying the right developers. Just last april did we purchase studios like Sports Interactive and Secret Level.
SPIEGEL ONLINE: And because your own growth isn't fast enough you focus on such costly buyouts?
SATOMI: We don't buy just to bloat our numbers - both sides have to suit each other. Like with Creative Assembly from England which we bought in the spring of 2005. We constantly watch the markets for such opportunities.
SPIEGEL ONLINE: You also risk paying larger sums even though SEGA only reported losses for years?
SATOMI: SEGA did have a very difficult time bevor we fusioned the company with the arcade machine manufacturer Sammy in 2004. In the fiscal year until March 2006 did it finally achieve a profit again. And we have a strong cashflow thanks to Sammy which also helps SEGA. Depending on the size of our goal could we pay a low but also a 2 digit-billion-Yen amount for a takeover.
SPIEGEL ONLINE: Sega always was something like the Disney of videogames with titles like "Sonic" and "Virtua Tennis". Now you're also offering more violent content with "Yakuza" or "Condemmed". Aren't you jeopardizinge your family-friendly image with this?
SATOMI: Up to now, we indeed foremost had kids as customers. Though, we also want to serve to different demographics. Only that way will we be able to dramatically grow our revenue in America and Europe by 2010. We believe that customers are well able to differentiate between our lines of product.
SPIEGEL ONLINE: SEGA has so far been focused on games for consoles and the PC. For mobilephones however, there are only few titles available - like an incarnation of "Sonic the Hedgehog". Will and can it stay that way?
SATOMI: The revenue we achieve with mobile games will eventually surpass what we achieve with console games - inevitable. It could be in 5 years or maybe in 10. In the industrialized countries, in Europe, USA and Japan, the console market is going to develope much slower than before. It's a developement we discuss on a regular basis. That doesn't mean that development for consoles and PCs will become unimportant - we see huge potential in Russia, India and China for instance.
SPIEGEL ONLINE: Well, do you carry a cellphone in your suit pocket right now Mr Satomi?
SATOMI: Of course (pulls a white sony ericsson cellphone out of his pocket). It's only rented though since my japanese one doesn't work here in germany.
SPIEGEL ONLINE: So, did you ever try to play games on this or other mobile phones?
SATOMI: Only a few times. I don't ride trains much and prefer to go by car - when am I supposed to play then? All in all, I don't game as passionately anymore compared to when I was younger.
SPIEGEL ONLINE: The head of SEGA doesn't like to game?
SATOMI: I do have all the important consoles at home, of course, but I don't really play games for leisure anymore. They are getting more and more difficult after all! I get games presented to me because of my job when we or our competitors release important games.
SPIEGEL ONLINE: SEGA produced their own console up to 2001 - now you are publishing software for Microsoft, Nintendo and Sony. Does it affect your company negatively that the PLAYSTATION 3(c)(TM) has been delayed my multiple months in Europe?
SATOMI: It will have a negative effect on our revenue in Europe. We have to step up the pace to keep it as small as possible.