Sega bow out of the console race

Sega's Dreamcast is to most people the most popular console currently available in this country, but with market insertion coming from Sony's colossal PlayStation 2, not to mention Microsoft's Xbox late next year, the company realises its console-making franchise is living on borrowed time. In an effort to turn itself around after some abysmal financial results earlier this year, Sega intends to move away from the console-development market and instead focus on software, with aims to increase its market share to 25%, which would put it ahead of Nintendo, who currently dominate. And obviously by software market we're not just talking about Dreamcast and PC here. The former will eventually die out and the latter sells nowhere near as many units as the console markets do. From a practical standpoint, the PS2 would seem a good target; the possibility of souped-up versions of Virtua Fighter, MSR and Virtua Tennis, some of its most popular brands might be a good idea. As for the rest, previous arch-rival Nintendo has already been caught fraternizing with Sega this week over undisclosed issues, so it would seem that a realistic interpretation of that meeting is that Sega want to work with Nintendo on the GameCube. For Nintendo this would represent a fantastic opportunity; the GameCube could do with some serious games rather than the usual cutesy catalogue. "We plan to expand our profit by utilizing our attractive and affluent software assets to appropriate devices," said Sega's Strategic Counsel, Tetsu Kayama, yesterday in Japan.