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Microsoft & Sega To Develop New Arcade Motherboard
Software giant Microsoft unveiled Friday an extended alliance with Japanese game developer Sega ahead of the U.S. company's closely awaited launch of its game console Xbox later this year.
The Xbox represents Microsoft's push into the $20 billion video game industry now dominated by Japan's Sony and Nintendo, which also are marketing advanced 128-bit game consoles.
Under the agreement, Sega will provide new games in its hit "Shenmue" series exclusively for the Xbox in the North American market and it will make new games in its popular "Phantasy Star Online" series for the Xbox. The extended alliance will add more firepower to the arsenal of Xbox, which is set to hit shelves on Nov. 15 in the United States, followed by a Feb. 22 launch in Japan.
The two companies will also work together to develop a motherboard based on Xbox technology for arcade game machines, Sega Chief Operating Officer Tetsu Kayama told a news conference at the Tokyo Game Show which started Friday. "We will join forces to boost our online games by combining our expertise," Kayama said.
The extended alliance was unveiled as concerns emerged about the U.S. holiday-shopping season after attacks on New York and Washington, but a Microsoft executive played down the worries.
"We cannot deny any terror impact, but I don't think it would be huge," Hirohisa Oura, managing director of Microsoft's Japanese subsidiary, told Reuters in an interview Friday. "After the attacks, I think people will be eager to express their love for family and friends and they are going to be a in a greater gift-giving mood," he said.
For Sega, known for its "Sonic The Hedgehog" game character, the alliance is part of its effort to become world's No.1 game software maker. Sega, which also makes games for Sony's PlayStation2 and Nintendo's GameCube console, said it aimed to sell 35 million games in 2003/04, up from its goal of 15 million this year.
"Given the fast progress of our game development activities, we now expect that we can sell around 15 million game units this year, some 20 percent higher than our initial goal of 12.7 million," Kayama said.
Sega abandoned the game machine market earlier this year because of poor sales of its Dreamcast console, shifting efforts to its healthier software business. Sega is in the midst of restructuring under which it aims to return to profit in the 2001/02 business year and to raise return on equity to more than 15 percent in 2003/04. "By promoting our multi-platform strategy, we aim to become the world's number one game software maker," Kayama said.
Some analysts, however, voiced concerns. "The 15 million sales figure was just their goal, not the revised forecast as Kayama also said some game titles may come later than original plan," said Takashi Oka, chief analyst at Tsubasa Research Institute.
"Before anything, we need to see whether the company can keep its promise on their interim earnings since the company has disappointed us many times in the past."
SOURCE: Reuters.
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