Sega Sammy Cutting 400 Jobs, 80 Arcades
By Earnest Cavalli EmailFebruary 08, 2008 | 4:43:05
Amid news that Sega Sammy Holdings expects to lose 26 billion yen ($243.9 million) during this fiscal year, the firm announced that they will be cutting 400 jobs from their videogame software group.
This sad news comes on the heels of a plan the company revealed in November to close or sell 80 of the group's 430 worldwide arcades.
Company executives see heavy Japanese regulation of the gambling uses for their pachinko systems (leading to an 85 percent profit decline for that section of the company), as well as the proliferation of the Wii (which gives gamers the ability to play many popular Sega arcade games at home) as key factors in their current financial woes.
The ongoing collapse of the traditional arcade makes this news not-so-surprising, but many were still stunned by the Japanese government's decision to crack down on the pachinko industry.
Certainly, it's a form of gambling, but with annual revenues of 30 trillion yen ($281 billion), you'd think they'd be willing to continue to look the other way, if not actively subsidize an industry which generates great, continuous economic windfalls for the nation.
I don't think the arcade will ever truly die, if only because there are so many frighteningly devoted Dance Dance Revolution fans out there, but this news is yet another kick to the ribs of the traditional arcade's badly beaten body.
Sega Sammy sees loss in 2007/08 [Reuters]
Amid news that Sega Sammy Holdings expects to lose 26 billion yen ($243.9 million) during this fiscal year, the firm announced that they will be cutting 400 jobs from their videogame software group.
This sad news comes on the heels of a plan the company revealed in November to close or sell 80 of the group's 430 worldwide arcades.
Company executives see heavy Japanese regulation of the gambling uses for their pachinko systems (leading to an 85 percent profit decline for that section of the company), as well as the proliferation of the Wii (which gives gamers the ability to play many popular Sega arcade games at home) as key factors in their current financial woes.
The ongoing collapse of the traditional arcade makes this news not-so-surprising, but many were still stunned by the Japanese government's decision to crack down on the pachinko industry.
Certainly, it's a form of gambling, but with annual revenues of 30 trillion yen ($281 billion), you'd think they'd be willing to continue to look the other way, if not actively subsidize an industry which generates great, continuous economic windfalls for the nation.
I don't think the arcade will ever truly die, if only because there are so many frighteningly devoted Dance Dance Revolution fans out there, but this news is yet another kick to the ribs of the traditional arcade's badly beaten body.
Sega Sammy sees loss in 2007/08 [Reuters]
Labels: Japan, layoffs, Sega Sammy
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