Sega Exits The Japanese Arcade Business After 50 Years

Sega has exited the Japanese arcade business, bringing an end to a run that lasted for more than 50 years in that entertainment sector. When the coronavirus pandemic put almost every social gathering on pause in 2020, Sega's arcade division was hit particularly hard and eventually resulted in its parent company Sega Sammy selling 85% of its arcade and amusement center business to Genda Inc.

This included assets such as amusement machines and associated prizes from Sega, and as of this week, Genda Inc. has purchased the remaining arcades from Sega.

While Sega isn't the only operator in the arcade space to see big losses, it is one of the most iconic. A mainstay of the Japanese arcade business, Sega was forced to close its Akihabara Building 2 arcade in September 2020 due to the expiration of the fixed-term building lease contract where it operated from and uncertainty surrounding the future of such businesses in the wake of the COVID-19 pandemic.

Once the rest of Sega's arcade shares are completely offloaded to Genda, Sega Entertainment will be renamed to Genda GiGO Entertainment, and all Sega branding at these locations will be changed to GiGO.

"Sega stores across the country will be switching their store names to GiGO, to express our gratitude for Sega's 56 years of history and our desire to be an oasis that quenches people's thirst for real entertainment," Genda GiGO chairman Hisashi Kataoka said in a statement spotted by VGC. "We will start with Ikebukuro, Akihabara, and Shinjuku. Then to the whole country."

One positive bit of news here is that Sega will still manufacture and sell arcade machines for now, although the Japanese arcade market has shrunk dramatically since its heyday in the 1980s. Alternatively, you can always start your own Sega arcade by purchasing a few of the mini-replicas that were released last year.