Sega confirms US layoffs

House of Sonic's American arm confirms its payroll has been trimmed due to "reality of business challenges to profitability."

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Today, Sega of America confirmed to GameSpot that it is the latest third-party publisher to cut its payroll. The news comes just weeks after a particularly brutal year that saw a worldwide economic downturn hit such third-party publishers as Electronic Arts, Midway, THQ, and PlayStation 3 maker Sony.

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In a statement, the company explained the pink slips thusly: "Sega of America has grown at pace with the booming video game industry, but at this time of economic recession, harsh retail landscape, and the reality of business challenges to profitability, we must take steps to reduce our cost structure and ensure long-term success. The decision to lay off staff was a difficult one, and we thank these employees for their contributions and wish them well in their future endeavors."

Sega's US redundancies come after a disappointing holiday season that saw the Japan-based company's tent-pole releases get mixed receptions. In the US, Sonic Unleashed sold more than 660,000 copies despite being critically drubbed*, according to the NPD Group. However, the poorly received fantasy-action remake Golden Axe: Beast Rider was an unmitigated flop, moving less than 42,000 units through the end of December.

When asked if the latter game's developer, Sega-owned Secret Level, was affected by the recent staff cuts, company reps declined to comment. Reps also declined to clarify the number of employees let go, although unconfirmed online reports put the number at about 30.

* The Wii version of the game was significantly better received than the PS3 and Xbox 360 versions of the game.

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Avatar image for revanent
revanent

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god i should hav bought more sega stuff. darn i wanner keep sega goin, hope sega not havin problems again like the dc money problems

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nizarindely

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No me había dado cuenta que la recesión económica le pega a todo y a todos, lo bueno del Unleash en el wii, es cuando se transforma en lobo y con el nuckchuck y el wii mote, jeje, son tus brazos, ahora se de la baja calidad, porque no es malo, pero cosas que ya habían superado, acá volvierón a tropezar con el mismo gijarro.

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hatieshorrer

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Best of luck to the employees that received layoffs. As for sega make sure the controls are proper before the release. Ive played so many demo's of Sega games in the last two years that would be at least average if not for the unpolished contrals.

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Apathetic

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If you own a PS3, go buy Valkyria Chronicles, not to help Sega out, but simply because it was one of the finest games of 2008 that lost its way in the november release onslaught (and no help Sega didnt advertise it at all)

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LindBergh2007

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You people make me laugh! Everytime I read an article about a publisher losing money or laying off people you blame them and not the economy or the collapsing video game market. Sega of America firing 30 people is no big deal folks! Compare it to 61,000 at Sony and over 1,000 at EA. SOA didn't lay off a tiny number of people because thier struggling, they layed off those 30 because everybody is being layed off in the retail market. Stop and think about who's being affected by this retail market: The publishers, the console makers, Blu-Ray and home video. You think Nintendo is exempt? No folks fbigent34 is right. Don't be surpised to see Nintendo of America lay people off too. CC going under is going to inflict some heavy damage on all the consoles and dramatically affect console demand and will really hurt budget and production. Also Best Buy is struggling so don't go whining when you see console sales drop because of thier issues. Sega of America is doing fine, everybody. This isn't 1998 where they layed off 40 to 50% of thier employers. This is 2009!They only fired a puny 30 people. not 1,000! Mind you Sonic Unleashed did very well with 600,000 units, and that goes for you Lamespot and your stupid misleading review. Compare them to EA,Midway,THQ and Eidos, SOA is doing far better then other U.S. publishers. This spin is just plain sad, and all of you that buy this BS need to grow up and remind yourselfs that other publishers are in the red and doing far worse then Sega of America. You can laugh and make fun of SOA, but don't be shocked if they suddenly own the Madden license, or even buyout T2 and I'll be the one laughing when Sega of Japan re-emeges in the hardware market once the PS3 is out of the way. By that time, the electronic market will have improved and games will be alot cheaper to produce.

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pakhair

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The last game I liked of sega was Yakuza 1 & 2 but I don't know why they didn't released the english version of Ryu ka Gotaku a.k.a Yakuza. It's really worse for people in game industry now a days coz firing staff rate is increasing day by day

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beekayjay

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This is sad news, I'm gonna buy Valkyria Chronicles to try to help out.

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icym

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I hope the upper management, lead programmer, or director-in-charge; who made the poor decisions, like of making a legendary co-op game into a single player game, was included in that wave of layoffs. To the development teams over there and everywhere, good luck in your search!

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Dreski83

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It saddens me to hear about more lay offs in the gaming industry, yet something tells me releasing games for the Sony system just isn't helping... :roll:

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mysticnamja

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Sega = Publisher Developers are the ones who make the game... the ones who made Valkyria Chronicles was the WOW Overworks division, who made shinobi, Streets of Rage, and the great Skies of Arcadia. The ones who made Golden Axe were Secret Level, who suck. The ones who made Sonic Unleashed is Sonic Team who deals with all the new 3d sonic games.. which arent doing great now but were great b4 during Dreamcast Sonic Adventure days.

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Osnic

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No, Unleashed is a million seller. More than 1,2 million copies. :p

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tidyspidey

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Oh, and I should have said; Shenmue 3 = Sega saver Well, for me anyway. Make it happen Sega

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tidyspidey

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I agree Azurewind - it's like they've been creatively stifled since the golden days of AM2 and Virtua Cop etc.... I ache for the day Sonic has a triumphant return - it WILL come, I just hope I'm alive to see it(!)

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fbigent34

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VenomRitual - wouldn't surprise if i here it but meh this is hurting all compaines i am interstred to see what might happen to Nintendo if anything yet.

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khariss

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empire total war will do well and sega just a suggestion streets of rage 3 ;)

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AzureWind213

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Why don't you let sonic team do what they WANT to do... a la Bungie... there is a lot of talent there but when you saddle them with "OH MAN, I go this GREAT idea about a werehog" and when you task them with capturing the 4kids generation of gamers, I mean, come ON. What do you expect when you ask them to do that? Let them actually work on their own ambitions... I bet we would ALL be very surprised at what they would come up with.

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Chimpman_Z

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I've got a bailout plan for Sega. Release Daytona USA, Sega Touring Car, SCUD Racer, and Indy 500 for XBL and PSN. It blows me away that this hasn't already been done. It's like these former quarter crunchers were BORN for this. Sega, go do this now. ...oh and Sega. Stop beating dead franchises to death...if that makes sense... People stopped giving a **** about Golden Axe back in '92.

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supersonicGO

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Create better remakes and games and you wouldn't be in such a mess. Idea: Shinobi?

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VenomRitual

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im waiting for someone to say that Nintendo should consider aquiring sega,

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enoslives7

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"Sega!!!"

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akechi419

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I have to give sega props for the yakuza games, they are some of the best i played. it blew up in Japan naturally but because of lack of advertising it didnt receive well here. I mean hell they even made a movie of it. Fighting is addictive, story is awesome. also if you check out the trailer for part 3 for ps3 it looks even better. Yakuza aside SEGA please fix sonic, w/e happen to sonic adventure?

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Dark_sageX

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@ xdeiri I agree! Sonic SHOULD belong to nintendo now! or Sony or even Microsoft! Sega is just too STUPID to make decent games nowadays! (Sonic Unleashed, Beyoneta, the list goes on) OK Valkyrie Chronicles is an exception but otherwise someone should really put them out of their misery.

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Meowmixxvi

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but but but what about valkyria chronicles :(

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jmartin1016

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Wow. Golden Axe bombed. It would have sold more copies if they had made it a co-op beatem up.

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pharcyde1521

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The Wii version sold more cos every man and his dog gave it away with the console at Christmas in Oz.. Sega should fire the whole design team for stuffin up the Sonic franchise and for screwing up Golden Axe. Instead of pretty, look what I can do with shaders and polygons, how about adding some gameplay in the mix i.e. IF IT AIN'T BROKE, DON'T FIX IT!. Sega's heyday blew up with the Megadrive and pullin the Dreamcast pin. RIP FUN gaming..

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Pittfan666

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That happens when you don't make a good game in years.

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xdeiri

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sega can make a good game any time they want, but the rubbish management and the continuous cheap project money seeking is preventing them trom doing so, i think we should punish them by forcing them to play their own games

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Paladin_King

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chupamelpo I think that's by and large because other markets that are suffering are suffering as a reaction to the American situation. The US is the source of the problem and is thus taking the biggest beating. For instance, while markets may be down in other countries due to the US, they don't have the housing and credit problems that got the US markets down in the first place. So no, it's not BS. Mpeg3s A few years ago, I would've agreed with you. However, looking at the 2009 lineup, Sega seems to be taking a new approach that looks promising. Madworld and House of the Dead: Overkill are taking a new look at the Wii and go along nicely with Sega's other franchises, like Condemned. It's an interesting direction, and I hope they don't go down. All they need is another Panzer Dragoon and a good Sonic game to along with their new stuff, and they could be very good. That said, Golden Axe WAS hideous.

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chupamelpo

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why is it, that we're only hearing US Laysoffs. Why not Thailands Laysoffs, or Chinas, or Indias laysoffs. What a perfect time to completely move US offices to other countries. This is BS

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Marcster1994

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Well They can't be doing the same thing over and over again.

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mpeg3s

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Sega should have died YEARs ago. Since 2D, they can make good games anymore!

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HavenlyHunter

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Sega release Ryu ga Gotoku Kenzan! in US and Europe

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roflmuffins8

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They really need to just make a traditional Sonic game that's fun and sticks to the original idea. As soon as they started adding things like the Werehog and Sonic having a sword, it messed up the entire concept and the games started sucking.

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Generalmojo

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Im still shocked that sega made Valkria chronicles, i just recently purchased it and its a WOW, ive played 1 hour of it already and i loved it, story, gameplay, everything, i sure hope they make a sequel or something :D

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coaltango

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i wish they had made golden axe a co op mode with better camera angle probably 2d would suffice.

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flyingteddy

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i'm hoping to get Valkyria Chronicles thats one game that looks worth buying, just been waiting for it to come down in price

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stevenrkorea

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Sega = Fail Now I know people will say 'oh this game was good and that game was good! I love Dreamcast blah blah blah'. It's just like the band Kiss. When you make a billion albums you're bound to get one right here and there. Sure Sega did some things well, but those were all flukes. Sega is like 99.9% suck, 0.1% fluke. The end is nigh for Sega.

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covenan

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oh well..they toast allready since the day they drop DREAMCAST on 2001...cant they just drop that useless blue dude,..rather then made him looks more idiot... make him vanish is much much better,..

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Aurey

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Sega should use its in-home studios instead of external development teams. Where is Smilebit? Where is AM2? Where's UGA and WOW? In the Dreamcast and Xbox heyday they produced some really good games.

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Karjah

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When oh when will people stop buying crappy sonic games. Sonic had his day. He's done and toast and most likely never going to make more then one or two good games at max in the future. Can we please just drop him already!

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xdeiri

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some one should buy sega to end this misery games lineup and garbage management, i always keep dreaming that nintendo will develop sonic game

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doomsoth

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I can understand why: Golden Axe and Sonic were terrible games; don't expect to make money off of garbage, Sega.

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Vainamoinen82

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Hard times...

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1425678786655

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i really hope sonic and the black knight turns sonic around. or they really just need to go back to the Sonic Adventure series since those were the last 2 good sonic games imo. and unleashed isnt even THAT bad. and secret rings wasnt that bad either. and ya Shenmue 3 would sell alot and they need another panzer dragoon

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luc11044

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42,000 units for Golden Axe? I'm surprised it sold that much. ;)

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TheArcade

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Bring on Shenmue 3! And when the heck are they gonna make a Fighters Mega Mix 2 or a new Last Bronx?! Streets of Rage also deserves a worthy sequel, hopefully they make it in hi-res 2D! @zaku101: Agree with you on Sonic Adventure.

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lamprey263

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I'm glad to see I'm not the only one on that comments about missing the Panzer Dragoon games, hopefully Sega will eventually take a hint and make another one... though, the idea makes me uneasy, it's rare enough that they actually make these games, but considering the way Sega makes games these days, it'd need to be a miracle after a miracle for it to be any good, if it ends up sucking I can just see Sega looking right back at their fans like "you want to have your cake and eat it too?"

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zaku101

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Sega should have died a long time ago. The last good sonic game was Sonic adventure.

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macrules_640

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Sega please stop making crappy Sonic games!

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