Sega lays off 10% of US, EU staff

Sonic publisher cuts more than 70 workers from London and San Francisco offices, creates new digital-focused division in latter location.

It's only been a matter of weeks since Sega shuttered the San Francisco studio formerly known as Secret Level, but the publisher is cutting payroll again.

Sega's dedicated digital division in San Francisco will oversee titles like Sonic the Hedgehog 4: Episode 1.

Sega today confirmed for GameSpot that it has laid off 73 employees from its London and San Francisco offices as part of restructuring effort for its Western operations. The cuts represent about 10 percent of Sega West, the company's non-Japanese business. A spokesman for Sega said the reorganization "reflects both the changing face of the global video games market and a need to improve efficiencies within the operation."

The cuts were made primarily from marketing and internal development divisions and were split about evenly between the publisher's London and San Francisco offices. As part of the restructuring, Sega is also setting up a new digital-focused division that will be based out of San Francisco, while the London location "will now act as a hub for the traditional console and PC side of the business." In addition to console downloadable titles, the digital division will be responsible for development on systems like the iPhone and iPad, as well as potentially social media networks.

Sega has undergone a series of institutional changes since the global economy hit the skids in late 2008. In January of 2009, Sega of America confirmed a series of layoffs due to the recession. In the months that followed, parent company Sega Sammy cut 560 jobs, or 18 percent of its global workforce. There was also an overhaul at the highest ranks of the company, as June saw the departure of Sega of America president Simon Jeffrey, with his duties being added to those of Sega of Europe head Mike Hayes.

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70 comments
Seiki_sands
Seiki_sands

@EchoEcho I take nothing away from Monolith (One of my favorite developers) by giving credit to Sega for Condemned. Monolith could not have gotten the game into our hands without Sega. Publishers matter too, and credit does need to be given where it is due, to the publishers who recognize, support, give guidance and assistance to the talent, as well as to the creators. Recognizing and nurturing talent is in itself praiseworthy. By saying Sega didn't make games like Bayonetta, Condemned, or the Total War games, you are the one taking credit away from someone involved in the creation of great games, not me.

Snicker-Man
Snicker-Man

sega needs to come out with something good the last game i played a good sega game was mad world and that was on the wii so i know not alot of people played that game

jtthegame316
jtthegame316

Tony-Baxter i am with you on that they could put some great titles up on xbox live are arcade and psn all though for me i would not care if they put em on psn as long as they put em up on the xbox. if they looked to the saturn. panzar dragoon saga, gardian heroes as i mentioned. also baku baku animal, panzar dragoon,panzar dragoon zewi, both clock work knights, nights, last bronx and loads of quality games i would espcally be happy to see panzar dragoon saga cause i want to play through that again but so hard to get hold of but if they put it on xbox live that would make it easy to get hold of and more people will get to play it and see what a great game it is. i have never enjoyed an rpg so much.

jtthegame316
jtthegame316

sega put yakuza 3 on xbox make a shenmue 3 for xbox then and put classics like panzar dragoon saga, jsr and gardian herose on xbox live arcade and i will be happy as would many people i am sure. well people with good taste in games anyway.

frazzle00
frazzle00

@lamprey263 You should give Yakuza 3 a go. It's internally developed and brilliant. I'd take Yakuza 3 over Orta any day of the week! @echoecho You're assuming that the publisher has no say/influence over the developer. You're also neglecting to take into account the fact that Sega's brandname is associated with these quality titles even though it did not developed them. So yes I think credit should be given where credit is due.

EchoEcho
EchoEcho

@Seiki_sands -- Give credit where credit is due. Like Angel_Belial said, at least half of those games weren't developed by Sega, only published. Saying "Sega still makes great games" and then listing ones developed by outside studios is misleading. Seriously -- the Total War games? Condemned? Armored Core? People need to learn the difference between "developer" and "publisher".

Tony-Baxter
Tony-Baxter

@ Lampr ey263 I AGREE Smilebit was the best dev they had except AM2

lamprey263
lamprey263

most of Sega's late success is thanks to the development efforts of outsides studios, like Platinum Games for making Bayonetta I don't think I have actually enjoyed a Sega developed game since Panzer Dragoon Orta, and Sega disolved that studio after it released, which is a shame as it was a well made game and one of my favorite

Tony-Baxter
Tony-Baxter

The Sega Saturn comes to mind when I think of what they could do DLC WISE.

ChiefFreeman
ChiefFreeman

that's too bad. Just when Sega seems to be on the comeback trail, too, with good games like Bayonetta.

storm_trooper10
storm_trooper10

@ spellmad Daytona USA is getting remade from what I've heard. It's currently in development but for the arcades.

Angel_Belial
Angel_Belial

@Seiki_sands The vast majority of those games were only published by Sega.

Seiki_sands
Seiki_sands

Sad news, and yes Sega still makes great games... This gen: Bayonetta, Condemned, Condemned 2, Madworld, Chromehounds, Virtua Fighter 5, Sega Rally Revo, House of the Dead: Overkill, Virtua Tennis 3, Armored Core 4, Resonance of Fate, Phantasy Star Universe, Sonic & Sega All-Stars Racing, Valkyrie Chronicles, Sonic Rush and Rush Adventure, Feel the Magic, Bleach DS 1 & 2, Infinite Space, Nights: Journey of Dreams, Medieval 2: Total War, Empire: Total War, Napoleon: Total War, The Club, Yakuza 3, Sonic's Ultimate Genesis Collection, and yes, even The Conduit.

spellmad
spellmad

well we have had remakes of outrun hd/ afterburner hd. for the love of god bring us daytonna usa was one of the best ever arcade raceing games would love to see it remade in hd. i keep my fingers crossed you never know one day >).

Grieverr
Grieverr

I agree with tommy_boy9999. Sega has made some really good games, specifically MadWorld on the Wii, where people were crying for a mature title, yet they didn't buy it.

Sins-of-Mosin
Sins-of-Mosin

Just another example of a Japan company not able to evolve with the times. Yeah, the Sonic kart game was decent but zero advertising. With so many games coming out a month, Sega needs to put money into advertising or they'll keep getting poor sales. Thou I'm sure they rather just kill their UK/US workforce instead of doing something good.

EdwardoMario16
EdwardoMario16

Inb4makebettersonicgamesderp. But seriously, this is far deeper than simply making good games. Sega has published plenty of quality recently. Sega could make the most amazing Sonic games in the world and it wouldn't save them from losing jobs. Crap economy is crap.

Richard7666
Richard7666

Shouldn't the article heading say UK? I know it's a member of the EU but saying EU just sounds misleading, like they have studios in more countries

tommy_boy9999
tommy_boy9999

How many of you people here saying terrible things about Sega actually bought and played their games. MadWorld was amazing Valkrie Chronicles is amazing Bayonetta is amazing Sonic Genesis Collection amazing THe Conduit is awesome You lemmings need to take a chance on different games and genres that you have never played. Sure every company makes a few terrible titles, but half of the casual gamers on here act like Sega did something to them personally.

Corvan
Corvan

Well its only going to get worse sadly..

reeree746
reeree746

This sounds an awful lot like the Auto Industry....

reeree746
reeree746

[This message was deleted at the request of the original poster]

coaltango
coaltango

we r seeing Sega since we were kids. i really think they can produce some really good games if they concentrate & focus on one title at a time & not launch half baked games

Barighm
Barighm

Sega's problem isn't so much the lack of good games as it is the marketing of them. How many people here are even aware of Resonance of Fate? A good action RPG from what I've heard, but you'd never know it if you didn't read a website like this. So, yeah, good thing they laid off people from their marketing division. They clearly weren't doing any marketing, might as well save some money there.

gamestesterjan
gamestesterjan

Damn it, I was actually thinking to reapply to Sega. I really hope the tax relief helps games publishers recover soon.

HAMMER261266
HAMMER261266

I hate Sega...RIP ChromeHounds 01/06/2010

drangel_jam
drangel_jam

Sega really needs to make better casual games, and make their great hardcore games, more user friendly and fun. For instance, VF5 is a great game, but it feels like the presentation, and the lack of certain game modes set if back. I don't quite agree with what I just wrote, I just can't quite explain what I'm trying to say. I guess, their games that have strong gameplay and strong content need to be more flashed to be more like crazy fun/guilty pleasure, somewhat like Capcom games. And their games aimed at casual and or young audiences need to be more solid. People still love Sonic, but all of the spins offs aren't any good.

zarkon9
zarkon9

i am getting laid off too... tonight!

Zerosumgame
Zerosumgame

Yeah, go back to its beautiful root, good move. Thank you god.

gamer082009
gamer082009

Sega should just sell their company to Microsoft already..but hey they'd probably turn into another version of RARE. (almost non-existent)

Malhound
Malhound

What if they reform the Sega Technical Institute and create Comix Zone again? The game Unbound Saga did not copy any element from the game.

Koi-Neon-X
Koi-Neon-X

I feel sorry for those people who lost their jobs and I wish them the best! I hope Sega can turn things around. I have a feeling they will because they have always made some pretty awesome games.

grasshopper6
grasshopper6

well if they go under other companies will get their game licenses and maybe make them better but I hope they do good and keep on giving us Sonic games maybe Episode 2 next year

beny_pimpster
beny_pimpster

haha now thats the american dream for you they train alot of their people to be bums lol

akiwak
akiwak

I hope they don't go under.... best of luck to the guys without jobs. May you find a new place to work soon!

2bitSmOkEy
2bitSmOkEy

..not really all that surprising...

bastianthegreat
bastianthegreat

those bastard screw up total war they are like a desease total war was improving extremely great before they sold themselves and now they seem to make little improvement die sega die

LS1100
LS1100

Everyone in charge of marketing should get canned for doing an aweful job.

Kruiz_Bathory
Kruiz_Bathory

Good thing IMO, Sega America is not as good as Sega Japan.

Triton
Triton

Happens everyday, why would this market be excluded? Folks don't have the money for basically toys and hobbies. To many bills, food, shelter and clothing. Look on the bright side, what is unemployment paying now, couple of years? Or ya get to keep your job and loose about 25% of your income and do the same job for a whole lot less. I wish them the best of luck.

hatieshorrer
hatieshorrer

Once considered a major console maker its depressing to see them falling.

xRmRxfreakBOMB
xRmRxfreakBOMB

@Jeff-Ryan Yea dude you're right! Everyone in America just decided to march over to Sega studios and DEMAND that 10% of their employees be fired. Americans also fly and shoot lazer-beams from their eyes!

LindBergh2007
LindBergh2007

People People, They are not failing. They are restructuring and refocusing on DLC and digital content. This has nothing to do with SEGA as a whole it's Sega of america's remaining division which is cutting back on development of current gen titles because of the high development costs of current gen software. Games are costing way too much to make, Sega of America isn't the only publisher laying off, Activision, Take 2 and others have cut back as well. It's clear to me most posters here are complaining about sour grapes. This is more about SEGA of america looking away from it's future of 3rd party titles, I can tell you that Sega is moving away from multi-platform games and more toward DLC also, SEGA has plans for a RINGWIDE based On-Live like downloadable console which it plans on launching later this year. So stop complaing about stuff you know nothing about. SEGA's doing this as a precaution, so they don't have to lose money on overpriced software and so they can rebuild thier American division. DLC and digital content is cheaper and more cost effianct to do then trying to sell $60-70 titles that few consumers want to buy because of the economy.

Zanoh
Zanoh

Simply put: Good games didn't get good sales and the horrible ones did...Leaving the good people out of work.

reeree746
reeree746

The reason why this keeps happening because you have the companies who make these games that NOBODY plays.

frazzle00
frazzle00

@Megavideogamer So what company hasn't been free from lousy releases? Activision? Square-Enix? EA? Bethesda? Capcom? Seriously dude!

Jeff-Ryan
Jeff-Ryan

Its all because of America's fault

wiiplay1
wiiplay1

Kinda sucks every time you hear people lose their jobs like that. Hopefully, they find one again.