As Sega Amusements Europe takes its first steps into a new era, InterGame speaks to Justin Burke on the history behind one of the most recognised gaming producers in the world

PAST

As Sega’s iconic mascot Sonic the Hedgehog celebrates his 20th anniversary, Jenni Shuttleworth takes a trip down memory lane, looking at what made Sonic so appealing to players in the first place and what keeps him relevant still, in today’s gaming culture.

For me, Sonic the Hedgehog is the ultimate representation of Sega. Like many of my generation, I may not have played the Sonic video game for longer than I care to remember, but the character remains iconic and takes me back to the early 90s.

Released on June 23, 1991, the first Sonic game was launched to rival Nintendo’s flagship character Mario. Sega was looking for a strong mascot to help drive sales so held an internal design competition at Sega Japan. After a drawing by artist Naoto Oshima was chosen, game designer Yuji Naka was brought in to lead the project. Although the designer had worked on a number of titles before, this was the first time he had headed up a production on his own, but Sega’s president at the time Hayao Nakayama was confident of his ability.

Nakayama was right. Sonic was immediately a huge success. A breath of fresh air to the gaming world, Sonic was unlike anything the industry had ever seen before. He grabbed the attention of players right from the outset and all of a sudden Nintendo’s short, fat plumber, whose most dynamic move was a waddle, didn’t seem quite so entertaining. Back then, your loyalties lay with either Sega or Nintendo and the rivalry between the two was not dissimilar to that between football teams. Mario may have been around longer than Sonic, but he didn’t have the blinding speed or the cool factor that the blue hedgehog boasted.

The introduction of Sonic without doubt revolutionised Sega and since the early 90s, he has gone on to become one of the most famous video game characters in the world, with more than 75 million copies of the Sonic video game series being sold.

As popular now as he was back when the game first launched, there is certainly an element of nostalgia when it comes to Sonic the Hedgehog.
I personally can recall spending many hours glued to the Sega Mega Drive console competing for the highest level and the most golden rings against my younger brother.

But what was it that kept us playing the game for hours on end? Perhaps it was the game design that had us hooked. Once you had built up the racing skills you could whizz through levels picking up golden rings faster than you could complete levels on any other game, which was both exhilarating and satisfying. Looking back, the game was obviously designed to have this impact on players, keeping them faithful to Sega and its new mascot. If I wasn’t so concerned about becoming addicted to it all over again, I would more than likely be found whittling away the hours at the nearest arcade right now!

Of course the protagonist himself played a key part in attracting and retaining players. Sega Japan is prolific in game development and takes risks by thinking outside of the box and doing things that others think are a bit off the wall - who’d have thought that a blue hedgehog could become iconic and remain as cool as he was 20 years ago?

Whatever the initial appeal was it appears to have stuck, similar to any other iconic character, and according to Sega there was no formula - Sonic just happened and it worked. A testament to his likeability was when Nintendo Power listed him as its sixth favourite hero. Although originally Mario’s arch nemesis, Nintendo stated that Sonic has remained as one of gaming’s greatest icons.

When Sega first brought him to life, Sonic was instantly likeable and still is to the younger generation of today. Although he might be presented in a different format now, the appeal is as fresh today as it was in the early 90s. Does Sonic the Hedgehog have the stamina to stay relevant for another 20 years? Our feeling is that he will…

PRESENT

As part of Sonic’s 20th anniversary celebrations, Sega Amusements has launched a complete line of Sonic the Hedgehog branded arcade games for 2011. From air hockey to basketball to a classic video driver and reel-based redemption game, this new range of amusement products aims to provide operators with a fresh approach to amusement, as Helen Fletcher finds out.

“We started with the air hockey table and basketball game,” said Sega’s Justin Burke. “To us, air hockey and basketball games always tend to look the same, they have the same theme and look very dark. It’s a crowded market and in order to break that market we felt attaching our mascot and brand, using the blue and white theme, seemed like the most effective and dynamic way to break away from the norm.”

While Sega had a good amount of success with these two products, it saw the opportunities that expanding the range could bring and officially launched a number of other new products at the 2011 EAG Expo held in London, in January. “We decided to look at what other products we could attach Sonic to,” continued Burke. “But we’ve not gone mad with it, we’ve been very selective – we’ve had companies approach us and ask if they can use the Sonic brand and we’ve said no in a lot of cases. Operators are now able to build up a Sega/Sonic themed area within their locations, all they need are three or four of the products and they all tie in quite nicely with one another.”

Leading the range of new products is SSR (Sonic and Sega Allstar Racing) Sega’s latest video arcade racer – but with a twist. The game sees Sonic and friends speed around tracks set in medieval castles, rain forests and bustling cities, all taken from the varied universes of Sonic and Sega. Players can battle it out in championship mode or link up to eight cabinets, which all feature a new illuminated cabinet and seat to grab players’ attention instantly. The ‘twist’ in the game comes in the form of a ticket payout system - a first for the video arcade sector, so not only do the players have the satisfaction of victory over their rivals but they will now be rewarded for it as well.

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Also new for 2011 is Sonic Sports Quad Air. A new and innovative concept in air hockey, it is a four-player table that changes the way air hockey is played. Up to four players can play at a time with up to four pucks; each player’s goal gate drops when money is inserted on their side of the machines, meaning that when only two people are playing they cannot score in empty goals.

Sonic Ticket Winner also brings a modern twist to a classic game format. Reel-based redemption is combined with the strong Sonic brand and his friends. Each cabinet features a different character making it unique and eye catching and up to 15 cabinets can be linked at once making use of the community game mode, meaning players have the opportunity to win the bonus community jackpot.

The Sonic branded range of games is, however, just the tip of the iceberg as Sega Amusements Europe takes its first steps into a new direction…

To adequately and accurately chart Sega Amusements Europe and its iconic Sonic brand through yesterday, today and tomorrow, you have to bring in earlier elements; it is all intrinsically intertwined.

It was Paul Williams, more than any other individual, who saw the forthcoming shift in market trends for the amusement industry.
The company COO decided five years ago that relying purely on not just
Japanese-sourced product, but solely Sega-sourced product, was not going to be a valid decision in the years to come. It was prophetic, of course, but then that’s what COOs are there to do!

In the intervening period, Sega has changed many of its fundamentals. Its amusement machine sales division within Europe and the US has climbed into bed with its consumer cousins; it has embraced third party developers; it has embarked on a policy of localised development; it has formed partnerships with other OEMs for distribution purposes; it has moved into the operating business.

The changes, according to Burke, have been rather breathtaking when viewed in isolation. In fact, the changes were introduced progressively to lessen the impact. But the effect has nevertheless been dramatic. “Without that policy we would be a pale shadow of what we once were,” he said. Burke makes no secret of the fact that to have relied purely on
Sega-sourced product out of Japan would have been a short-term solution and would probably have led to a short-term life.

“Sega in Japan still produces very, very good amusement games,” he said, “but they are not as prolific as we would have needed to continue to expand and grow the company; especially in light of the trading aspects which were to beset the industry in the past few years. We began to develop games ourselves, here in Europe, using teams in Cardiff and here in London. We used third party suppliers for the software and often injected into that software our own ideas based upon our own experience in the industry. We built the games here – and even exported them to Asia if they fitted the psyche.

“Sure, we brought games in from Japan too, but only if we felt that they fitted in Europe – or in North America, if it suited that subsidiary. But the point is that with what was to happen over the past three or four years, the movement in the business structure of Sega’s European and American subsidiaries had to happen or we would simply not be here now.”

Burke’s certainty seems difficult to accept at face value, given the strength of the European office’s structure and the quality of the people there, but the changes within the company have clearly been profound. We had Sega Amusements Europe and America and within each geographic region we had coin-op and we had consumer and the twain never met. All of that has changed. Sega at South Chessington and Sega consumer at Chiswick – also near London – now work hand-in-hand. COO Paul Williams flits between North America and Europe while the overall responsibility of amusement and consumer outside of Japan lies with senior Sega president Naoya Tsurumi.

Tsurumi, Williams and the other senior people at Sega in Europe have led the company carefully away from its vertical integration and broadened its business base to accommodate what was to happen between 2005 and 2010. Burke has seen first the introduction of third party software leading to products like Ford Racing and Grid, all ‘local’ products, emanating from Europe. “We are almost at the situation of parity now, between games originating from local offices like Europe and those coming from Japan.“

FUTURE

Part of the future for Sega is accepting the philosophy that the video game cannot by itself form the company’s future.

“It will always be the backbone – or even part of the backbone – of the business,” said Burke, “but the days of 20 years ago when a video game cost £10,000 and took £1,000 a week are long gone. The video game, especially in its dedicated format which cannot be reproduced in consumer format, will always be the centrepiece of any arcade or FEC. And operated properly will always earn well. But the future for us lies in a combination of product; an amalgamation of offerings from the top brands in the world.”

This was another fundamental change in the Sega philosophy. Third party software was the first step, but equally important was partnerships with top game-makers to handle their products. “We have the infrastructure; we have the local presence in global markets. Those game-makers needed that and if their products did not compete with our own, then it made sense to form alliances.” Burke was particularly enthusiastic about the ICE line coming into the Sega inventory, and then other top offerings such as Game Concepts, Pan Amusements, Andamiro, Triotech, Fantasy Entertainment. “The only thing we don’t offer now is gaming machines which is not our business and in any case is not universally acceptable in international markets.” Having said that, Burke went on to note that the company had formed a partnership with gaming machine producer, Empire, for its Sonic Ticket redemption game…

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Equally important in the future for Sega is its movement into operating, a diversification which began with the use of XD theatres by Triotech, initially in the Bluewater shopping centre in Kent, UK (the largest in Europe), and subsequently a string of similar locations around the country. “Bluewater was effectively a shop window for us. The XD is too big and expensive an attraction to have sitting around in a showroom and in any case it is better illustrated in operating circumstances. So we organised a prime location for it – and shipped interested operators out to Bluewater to see it in action.” Three more are about to come online, Derby, Glasgow and Milton Keynes, and the intention is to run a series of 20 of the attractions around the UK and then spread them into Europe.

And then there’s the Bowlplex development – 18 tenpin bowling centres, two in Wales, two in Scotland the rest in England. Sega had a relationship with Bowlplex stretching back 15 years, supplying it with product for its centres, but Bowlplex had its own machine operating division. The deal recently concluded means that Sega is taking over the operation of those games in their entirety. The company is bringing in strong Sega and Sonic branding in each location and has already had its first two months of operating at its first remodelled location, at Yeovil. That has seen a 60 per cent uplift in machine ‘take’, illustrating the benefit of utilising a company with Sega’s history in the business. Brighton will be next to come online and then in quick succession the rest of the chain.

Third party developers, local R&D, strategic distribution partnerships, operating…Sega in Europe has changed radically in the past few years. The process will continue. The change was really a strategy to survive, but has turned into a strategy to survive and thrive. In 2010 it was notable that Tsurumi told his senior managers that Sega should and could become ‘ubiquitous’, that it should, as the adjective suggests, ‘be everywhere’. The name and the logo should become as familiar to the consumer as leading washing powder brands or major supermarket marques.

They have at least laid the framework for that.