Sega Amusements USA Inc. (SAU) is a company with its game face on. The company is taking leaps to become a full-service industry player in response to an industry changing very rapidly. The coin-op game industry has a set of widely known challenges; however, companies within can take measures to re-invent the standard philosophies with a few creative minds and a toss of the old business model. As seen at the AMOA trade show in September, SAU is addressing these observations by growing its menu to cover all market cravings.

 

What's up with the industry? The short answer: time, technological convergence, demographics, an increase in development costs, dependency on popular titles, obsolescence, violence and gun scrutiny, plus a changing economy and the need for cost-efficient recreation and entertainment.

Dinosaur King and Love & Berry 
display at the AMOA Expo

Since the reorganization with Sammy USA in 2005, SAU has been taking measures to transform into a new company and cater to a changing marketplace affected by these obstructions. The new Sega menu includes a wide selection of games designed for the Street market, such as Extreme Hunting 2-Tournament Edition(TM), thrilling attraction cabinets for large entertainment facilities, like the Outrun 2 SP(TM), and Afterburner Climax(TM) super deluxe models, plus unparalleled merchandise, ala Disney(R) Cars(TM) plush, and five-star company services, including the ALL.Net online platform.

 

"Our reorganization began a year ago and we see all of our hard work paying off now. It took a lot of work to combine the minds of two companies and create a new outlook going forward," says Rick Rochetti, President and COO, "It was refreshing to see the excitement about our product among our customers at the AMOA show, and our staff is also carrying a great, positive attitude."

 

The People and the Product

 

Coin-op customers went manic over Sega product at the recent Amusement and Music Operators Association (AMOA) International Expo. The booth, stocked with over 18 SAU staffers, had a constant flow of traffic gazing at the dynamic Afterburner Climax and Let's Go Jungle(tm) machines, among many others. It is clear that SAU has expanded its product lines to try and service all categories of customer within the industry. Sixteen video and prize dispensing games were displayed at the show. The list of models included three configurations of Afterburner Climax, two versions of Ford Racing: Full Blown, two of Extreme Hunting 2-TE, two of Love and Berry-Dress Up and Dance(tm), two of Dinosaur King(tm), along with SpongeBob SquarePants(tm), Line It Up(tm), and Let's Go Jungle.

 

Let's Go Jungle is an adventure for all ages coming in December. It is a two-player, fixed gun cabinet that takes its characters through an exciting jungle excursion gone bad. The cabinet resembles a sports utility vehicle. Game play is addicting with its team-style mode and constant action. Let's Go Jungle is the right balance for adults and children alike.

 

In addition, Sega had a separate 10-foot by 40-foot booth entirely dedicated to the company's new Disney product and Sega UFO Catcher(tm) crane game. Critics may say less is more when showcasing product, but Sega has much to offer. Certainly all types of customers from local bar to theme park operators had a menu to choose from that could suit their needs.

 

ALL.Net Division

The ALL.Net team, (l-r): 
Daniel Zahnle, Bryan Youngsma, 
and Ben Kadish

Part of Sega's response to the industry's need for change is the development of the ALL.Net online platform for coin-op titles, which was announced "available" at the recent AMOA trade show in Las Vegas. ALL.Net is a platform enabling various Sega titles to run online tournaments, download new content, and in the future will offer additional entertainment services, such as online match play or possibly head-to-head play.

 

The tailoring of the ALL.Net service to the complex U.S. market took place over an 18-month period that involved product development, building a local division and basing the business on the needs of the player and operator. Extreme Hunting2-TE is the first U.S.-released title on ALL.Net and was the source of the platform's preliminary tests.

 

By putting games on ALL.Net, Sega extends the entertainment experience for the player beyond the coin drop through online communities surrounding each title. Extreme Hunting 2-TE is the first example of this extension. The game, when coupled with ALL.Net, offers players a rich community Web site, tournaments that award prizes, and a unique game play experience, all of which Sega believes will be part of the new methodology for the traditional arcade game. With constant advancements in consumer games, players are expecting much more out of games at their local bar, restaurant, or arcade, and Sega is delivering.

 

With high-performance test tournaments in GameWorks arcade locations under its belt, the division has focused on establishing its commitment to the street market. The company has historically recognized the importance of the street market to the industry, so naturally it was appropriate to provide something new and powerful to the street.

 

The ALL.Net team is led by Director of Technology Ben Kadish and includes Event Promoter Bryan Youngsma and Logistics Coordinator Daniel Zahnle. The division is committed to troubleshooting and installation support with the purchase of the ALL.Net platform through a combination of sophisticated monitoring tools and old-fashioned customer service. This level of commitment is not always seen in the industry. But through a combination of listening to operators and players, a tradition of technological vision, and a commitment to customer service, Sega is leaping over the competition into the future of coin-op entertainment.

 

"The launch of the ALL.Net business is a tremendously exciting opportunity for us as a division, and for the company as a whole," says Kadish, "In some ways we are reshaping the future of the coin-op industry in the United States right here and now."

 

New Business Division

Lara Marinier and Daisuke Yoshida 
of the New Business division

Another fairly new department of the company is the New Business division, which was established in November 2005. It too is working to fill certain gaps in the U.S. coin-op video game world. How about a video game exclusively for girls? That's exactly what Sega did. With Director of New Business Daisuke Yoshida in charge, the division has released Love and Berry: Dress Up and Dance to the marketplace. It's a card dispensing game based on playing dress-up and having dance-offs with your opponent. No need for more explanation. It's brilliant. The department is also beginning to build its team with the addition of Marketing Assistant Lara Marinier.

 

"Sega was the first manufacturer to bring the amazing 'Video Game Trading Card' concept to the U.S. coin-op market with Mushi King and Dinosaur King," says Yoshida. "The next step was to release this concept in a game specifically made for females. Now our customers can have a game that girls will love to play, and, therefore, have a reason to revisit the location. As we say...girls, it is your turn! Enjoy."

 

The Merchandise Division

The Merchandising division team, (l-r): 
Daria Szpiczakowska, Candice Lozano, 
David Cane, Laurie Jezuit, 
and Katherine Braun

The Merchandise Division has certainly evolved from its conception at Sammy USA. From the days of licensed keychains and capsules to collectible sports memorabilia the prize team has never strayed from their original vision to offer high-quality, unique items that players today want to win. The new, highly anticipated partnership with Disney to manufacture exceptional quality, collectible plush has certainly upped the ante, both for the division and the industry!

 

SAU is excited to bring the amusement industry keychain plush, medium plush, jumbo plush, and plastic boxed toys featuring unique styles and vibrant Disney characters perfectly suitable for cranes, redemption counters, and its newest crane sensation, Sega UFO Catcher.

 

Sega UFO Catcher is a two-player machine with a dynamic two-armed claw design capable of picking up many different sizes of plush and toys. So far, the game has received nothing but rave reviews when using Sega's beautiful Disney plush, proving once again that better merchandise produces better income.

 

"Our business model is to bring high-quality, creative merchandise to the industry by introducing unique 'series' of plush for the collector. We're deliberately bringing in limited quantities to enhance the collectibility and we are providing special posters and clings for SEGA UFO CATCHER to promote the plush inside the crane," states Dave Cane, Vice President of Merchandise.

 

Sega UFO Catcher is a new concept for the industry, offering a very special Automatic Plush Shipment Program. Operators can sign up and receive the newest series of plush to keep their cranes fully stocked with exceptional Disney product.

 

The concept of higher-end plush in cranes has already generated tons of excitement from operators and players alike. The demand nowadays is for nicer merchandise. Crane connoisseurs appreciate and pay more attention to quality; the days of cheap, raggedy plush are out the door. Placing Sega's collectible Disney plush items in Sega UFO Catcher has been proven as a way to keep players coming back for more since the name of the game is building that special Disney collection. Without quality merchandise, parents may be more inclined to save that dollar rather than "waste" it for lesser quality prizes inside a merchandise machine.

 

Under the leadership of Cane the department has flourished with both new employees and new responsibilities for the veterans of the department. Candice Lozano is the division's newest Regional Sales Representative, Daria Szpiczakowska was recently hired for graphic design, and Tina Bowling is enjoying her new role as Sales Coordinator. Katherine Braun, previously the department's Sales Coordinator, has taken on a larger role for the sales of both Disney merchandise and retail sports collectibles (the other half of the Merchandise Division). Eight-year prize veteran Laurie Jezuit has been promoted to oversee the sales of the division under Cane.

 

Another supporting machine for the Merchandise Division is Line It Up, which also made its debut at the AMOA Expo. The company recently acquired sales rights to Line It Up, which is an original Team Play Inc. creation. Team Play President Frank Pellegrini, and Sega President Rick Rochetti agree that the affordable price of Line It Up plus the SAU name is a hot ticket. The game has earned phenomenally in its test phases.

 

The cabinet has a retro feel and the game play is fun. It's yet another great machine for the street venue. Furthermore, Sega has found the final component of the formula: fill it with high-end prizes like iPods(tm) and Game Boys(tm) and the game becomes the highest earner of all other merchandisers at the location. Operators are encouraged to visit their local electronics stores and high-end retailers for Line It Up fillers, plus Sega offers a nice selection in valuable prizes such as licensed McFarlane Sports Figures and Upper Deck Diecast vehicles.

 

Sega Attractions

Extreme Hunting 2
Tournament Edition 
Deluxe cabinet

 

The new Sega has inherited the philosophies of both prior entities: Sammy and Sega. The former Sammy USA was in the business of delivering classic video games and prize dispensing machines to the industry. Sega, on the other hand, has always had its investments into newer technologies and medium- to large-scale product. Today, Sega has something on the menu for every customer.

 

"Generally everyone is pressured to make better purchase decisions. Consumers, households and route-men and women alike fall under those constraints," states Director of Sales and Marketing Ron Malinowski. "That's why 'value added' is the new credo. Everyone is after that little bit more. Whether it's a small trinket, a ticket from our SpongeBob Squarepants game, or experiencing some incredible motion-based thrill on Afterburner Climax, this is what today's pressured consumer is demanding. Sega has to separate itself from the competition. We can't accept any less."

 

Sega will not accept any less. In addition to its merchandise lines and street-savvy titles described earlier, the company also has a fresh line up of attraction games, including House of the Dead 4 Special(tm), Outrun 2 SP Special Deluxe, Afterburner Climax and Let's Go Jungle, all within the Lindbergh(tm) hardware family. Family entertainment centers (FECs) continue to be a fixture in the American leisure culture. People visiting these facilities expect to see the latest and greatest in video. This includes 'attraction' games that they most likely cannot experience at their local bar, restaurant, bowling alley and movie theater. FECs know this more than anyone: keep patrons excited about the experience and locations will witness repeat visits. That is precisely why Sega has "the big ones" in its arsenal.

Outrun 2 SP Special Deluxe (SDX) and Afterburner Climax are two amazing creations developed by Sega Corp.'s famous AM2 Research and Development team. Producers of the original Outrun and Outrun 2 SP projects noticed huge success from the Ferrari(r)-licensed drivers, and have observed the industry's current need for the next big driving game. So there we have Outrun 2 SP SDX, a simulated, four-car cabinet with interactive team play.

 

This massive, attractive cabinet is equipped with four Ferrari buckets, seating a total of eight players. Each car satellite is in control of its corresponding car in the game software. Driver-side and passenger-side are interchangeable with this experience; control over the vehicle switches to the player's teammate when the driver collides with an opponent or crashes into a barrier.

 

Afterburner Climax, another well-known classic, is offered in three cabinet configurations: Super Deluxe, Deluxe, and Standard. Both deluxe models are simulated cockpit cabinets with the superior being a Simuline creation. At first glance these 'aircraft' are immediately stunning and representative of the phenomenal graphics and game play featured within. SEU predicted what the opposing view would be: same game, but what about a Street version? To counter the critics, SAU made the executive decision to build a standard version to meet those needs.

House of the Dead 4 Special takes the gory magic of House of the Dead 4(tm), adds additional weapons, characters and stories, and plants them into a towering theater-style cabinet. The double shooter features two, 100-inch XGA projection screens, surround sound, air gusts, and a vibrating, pivot seat. Players enter the House of the Dead underground world with this 360 degree environment.

Research and Development Division

 

While SAU has many success stories with game developments from its parent company in Japan, the U.S. organization has began focusing more intently on its local research and development team lead by General Manager Tad Nagamatsu. The department plans to add a new team to its existing staff by Spring 2007 and has an even larger hiring project scheduled for 2008. The expansion will allow for simultaneous development of titles and will also enable SAU to employ all research and development aspects from its home turf.

 

"We have just completed a large hiring spree and are excited to extend that with the Research and Development department," says Executive Vice President Jim Miskell, "It is important for a company of our size to continue planning for the future and make wise investments. We are excited for what is in store and are happy to expand the SAU team."

New hire Tina Bowling, Sales Coordinator

In 2006 the current team released its sixth hunting title, Extreme Hunting 2-TE. For this endeavor Nagamatsu's team evaluated the advantages and disadvantages of previous hunting titles, as well as studied new movements and climates for the next. The team literally designed the game from the inside and out.

 

However, the department still needed the expertise of Sega Corp. in its approach with the ALL.Net online project. Sega of Japan's development team assisted SAU in creating the first U.S. ALL.Net compatible game. With the platform now available to the industry, the team anticipates continued work and support on Extreme Hunting 2-TE with new content downloads and tournaments.

 

SAU's R&D will also be a large player in developing future games for the online platform. "By growing the department with new, talented people we will be able to tailor our games more for the domestic market, much like we did with Extreme Hunting 2-TE," states Nagamatsu, "We are excited to grow our local development team, and deliver even more quality games to our U.S. customers."

 

Conclusion

 

Growing divisions, a vast variety of product, license deals, and more, SAU is on a steadfast path in the current amusement market place. "We are constantly looking at market needs and consistently reacting to change," states Rochetti, "Sega management always has 'the menu' in mind; that menu will continue to separate us from the rest."