Okawa Talks Dreamcast Future

Tonight at a special ceremony for the Okawa Foundation (a nonprofit organization that contributes to the growth and development of technology), CSK and Sega Enterprises chairman Isao Okawa revealed the Dreamcast's future. A future that goes beyond just games - Sega is moving online, and in a big way.

Okawa addressed members of the Okawa Foundation and honored individuals of the foundation, Sega members, and the press with a speech about the Internet. He stressed how the 21st century will be the century of the networked society. CSK is attempting to poise itself on the cutting edge of the Internet revolution, and the Dreamcast will play a big part. With strategic alliances with Internet services and future peripherals like the Dreamcast digital camera and zip drive, he sees the console as a very powerful online component.

The Dreamcast zip drive was finally displayed at the Okawa Foundation event. Resting underneath the Dreamcast unit itself, the two connected hardware components gave off a great aura - they looked perfect together. The possibilities the zip drive will allow for are wonderful - new downloads for games including characters and stages, not to mention the ability to create material and store it on the drive (which Sega claims will read and write much faster than current zip drive units employed in PC configurations). Sega of America did not reveal a US release date for the device, but GameSpot News had previously learned that it will be launched in Japan in February.

Okawa also showed off an early demonstration unit of the Dreamcast Digital Camera. The device, resting atop a TV monitor, will be able to display your face on a second player's monitor while playing a video-enabled game. A demonstration held at the event showcased two Dreamcast units networked as video was being transferred between the two. Players could also chat in real time via the Dreamcast microphone device.

Following the Okawa Foundation speeches and other ceremonial events, Mr. Okawa took questions from the press. This is where it got very interesting. One question was in regard to how Sega's Dreamcast will be able to compete with upcoming consoles like the Sony PlayStation2 and the next Nintendo platform (currently code-named Dolphin). Okawa responded that he feels that the Dreamcast price is very competitive, especially compared with the PlayStation2. As well, he feels that the Dreamcast's online elements, such as the inclusion of a modem right out of the box (the PlayStation2 will ship without a modem), are its real strength. Future online network elements, such as connectivity with watches and cellular phones, are also planned.

However, the greatest revelation during our discussions came as a huge shock to many of us seated next to Mr. Okawa. While this has been hinted at by the media and even members of Sega in the past, hearing the chairman of Sega Enterprises officially state it was very surreal: Sega is moving out of the hardware business. The Dreamcast will likely be the company's final console. Even when asked what Sega's plans will be if the Dreamcast proves to be a major success, Okawa reaffirmed that the company is moving away from the hardware market. He stated that the future of Sega rests in the Internet and its software lines. Previous discussions as to the expandable nature of the Dreamcast may come into play sooner than previously expected. If this is Sega's last major "console," we may begin to see more add-on devices early next year (the DVD drive and the cable modem interface). In fact, on display, behind a glass case, was an ethernet cable designed to replace the Dreamcast's 56K modem. While there were no concrete revelations regarding the future configurations of the hardware, successful or not, the Dreamcast appears to be Sega's final hardware effort.

The subject of Sega Enterprises spinning off a new Internet company (to handle e-business and online gaming for the Dreamcast) was once again brought up. Okawa stated that current plans are for such a company to be launched in the US sometime in the near future.

About the Isao Okawa Foundation for Information and Telecommunications: Established in 1986, the Okawa Foundation is a nonprofit organization that contributes to the growth and development of technology by offering financial aid and grants to faculty researchers and children's programs. The foundation offers one annual Okawa Prize. Mr. Okawa oversees 90 companies, with a total annual turnover of approximately US$7.5 billion.