The demise of Sega was not inevitable and can be blamed on two decades of bad decision making.
That’s according to for Sega of America CEO and current LeapFrog vice chairman Tom Kalinske.
"It could have been avoided if they had made the right decisions going back literally 20 years ago,” Kalinske told Games Industry of the company’s inability to compete in the modern console market. But they seem to have made the wrong decisions for 20 years.
"One of the key reasons why I left Sega is when we had the opportunity to work with Sony, when [Sony Interactive CEO] Olaf Olafsson, [Sony Corporation of America president and CEO] Mickey Schulhof and I had agreed we were going to do one platform, share the development cost of it, share the probable loss for a couple years on it, but each benefit from the software we could bring to that platform.
Of course, in those days, we were much better at software than they were, so I saw this as a huge win. We went to Sony and they agreed, ‘Great idea.’ Whether we called it Sega-Sony or Sony-Sega, who cared? We go to Sega and the board turned it down, which I thought was the stupidest decision ever made in the history of business.
And from that moment on, I didn’t feel they were capable of making the correct decisions in Japan any longer."
Kalinske went on to address former market rival Nintendo, saying that bringing Mario to smartphones would be a sensible business decision.
"I don’t think [Nintendo] should give up hardware or consoles," Kalinske addedd. "I am surprised that they haven’t formed a division to extend the IP. I’d love to play some of their games on my iPhone or iPad.
It’s really a form of marketing for them in a sense. They wouldn’t even need to make that much money off it, but it would keep their brands relevant with the users, including people that are older, like me. So it seems to me it’s a marketing mistake, but I don’t think they should give up what they’re doing because they’re damn good at it."