What once was a force in the Japanese arcade industry, Sega Entertainment, the arcade division of Sega Sammy has taken several drastic actions following significant losses. It’s been a whirlwind of unfortunate events, so consider this a summary of what has occurred:
The Akihabara Sega Arcade closed Spring through June in compliance with COVID-19 restrictions. In June, Sega hoped to give a boost to the ailing arcade industry with “Fog Gaming,” a process by which networked arcade cabinets can be used for cloud computing functions. Despite this, the Akihabara Sega Arcade permanently closed on August 30th.
A month after this closure, Sega Sammy Holdings proceeded to significantly reduce its stock, staff, and costs regarding Sega Entertainment, opting to sell the majority of the division to Genda Inc, a company specializing in arcade machine rentals. Sega Sammy will retain only 14.9% of their stock, and anticipates losing ¥20 billion following the sale by March. It is believed that this move equates to Sega Sammy leaving the industry of owning and operating arcades in Japan; however, Sega Games (the game development division) confirmed that surviving arcades can continue to use the Sega name.
As a consequence of the sale, Sega Sammy is offering voluntary retirement with “payment of extraordinary retirement allowances and reemployment support for applicants” to 650 full time employees, while management and executives across divisions will have a significant pay cut ranging from 10% to 30%.
Despite the slow decline of Japanese arcades over the last decade, Sega remained a strong and iconic presence throughout. Whether you’ve visited one of Sega’s arcades in person or through the Yakuza series, they stand as a reminder of Sega’s legacy across the history of gaming. Our sympathies go out to all those whose livelihoods are impacted by these events, and our hopes remain that Japanese arcades can weather these difficult times.
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