Original author: Zen

At the end of June, explosive news was revealed in the antitrust lawsuit between the FTC (Federal Trade Commission) and Microsoft, stating that Microsoft has been wanting to acquire the Japanese video game company Sega and pointing out that Sega's software lineup has global appeal in various niche markets. However, the former gaming giant is not concerned about this. Sega insists on independent operation and earlier this year acquired the developer Rovio of "Angry Birds" for 776 million euros.

Sega's origins can be traced back to the 1940s, making it a long-standing company. Its development trajectory largely represents the continuous exploration of the gaming industry in the hardware field. Although nowadays when people mention Sega, they may think of the representative works from several years ago, such as "Sonic the Hedgehog" and the "Yakuza" series, it still maintains wide influence by adapting to technological progress, continuously applying new technologies, and adjusting its development direction.

The "Super Game" Plan and the Ambiguity with NFT

In May 2021, Sega publicly announced the "Super Game" plan for the first time at a financial performance conference. Its parent company, Sega Sammy, stated in November of the same year that it would consider investing up to 100 billion yen (approximately 900 million US dollars) over the next five years to complete this plan.

Initially, because Sega did not disclose detailed information about the plan, people mistakenly thought that the "Super Game" might be a single large-scale game. However, in an interview in April 2022, Shuji Utsumi, the Executive Vice President of Sega, revealed that Sega has been developing multiple games within the framework of the "Super Game," and each game will be different. They will be interactive games that go beyond traditional game frameworks. He also stated that the "Super Game" will be an AAA game that combines all of Sega's development technologies, including the cloud technology and NFT field that Sega had just entered at that time.

In April 2021, Sega invested in the blockchain startup company double jump.tokyo and planned to collaborate on developing digital collectibles based on the company's game IP, officially entering the NFT field. In the financial report for the second quarter of that year, Sega stated that "investment in emerging business areas such as NFT" is part of the future. At the end of the same year, Sega also applied to register the trademark "Sega NFT" in Japan. However, the player communities of this long-established gaming giant are not buying it, just like Ubisoft faced with over 90% of player opposition after promoting "NFT experiments" on YouTube. Sega, which has not yet conducted any NFT sales, faces the same predicament.

Due to the strong negative emotions expressed by fans, Sega has reassessed its role in the NFT market. In January 2022, Sega CEO Haruki Satomi stated that they wanted to try various experiments and had started many different research and considerations, but no decisions have been made regarding the P2E mode. Sega stated that if NFT content is seen as "easy money" rather than something that can attract users, it will abandon its exploration of NFT plans.

Authorize IP to third-party blockchain gaming companies

Recently, Bloomberg reported that Sega's COO Shuji Utsumi stated that they will withhold their largest franchise rights in third-party blockchain gaming projects to avoid devaluation of IP, while Sega's own Web3 game development plans have been put on hold. Sega also criticized the Play to Earn model as boring and stated, "What's the point if the game isn't fun?"

This news has just started to spread, and Line Next, the Web3 project under Korean instant messaging app giant LINE, announced its collaboration with Sega. Through the agreement, Line Next obtained authorization for a "very popular" game IP from Sega and will develop a Web3 game based on this. After its launch on their blockchain gaming platform Game Dosi, it will support NFT creation, digital payments, and marketing activities. Game Dosi was launched in May this year and is a Web3 gaming platform that provides "user- and game-centric services."

As a staunch ally of Sega's Web3, the blockchain gaming company double jump.tokyo has basically handled all of Sega's blockchain-related collaborations. Oasys, the gaming public chain launched jointly by Bandai Namco and Sega, has its main development team from double jump.tokyo. It has also naturally obtained authorization for two IPs from Sega, which were used in NFT projects and blockchain games.

In March this year, double jump.tokyo collaborated exclusively with Sega's classic 3D fighting game series "Virtua Fighter" for the NFT project OASYX based on the Oasys blockchain. The first NFT series "Virtua Fighter" was launched under OASYX, with a total of 1,000 NFTs, including 11 characters from the first three Virtua Fighter games. As part of the collaboration, fans can obtain a limited edition VF "MAYU" NFT, which will include special Virtua Fighter characters, with an initial release of 10,000. "Virtua Fighter" is widely regarded as the pioneer of 3D fighting games, first appearing in 1993, and its popularity once surpassed that of "King of Fighters" and "Tekken."

"Battle of Three Kingdoms" is a collectible card game set in the Three Kingdoms period of China. Its first version was released in 2005. Last September, double Jump.tokyo obtained the license for this IP and announced the development of a blockchain game called "Battle of Three Kingdoms." In late June of this year, the game launched a teaser website, highlighting NFT cards as a major feature. These cards not only include characters from the arcade version of "Three Kingdoms Battle," but also new military commander cards created specifically for this game. Players can build their own decks and participate in battles, with each match lasting only 3 minutes. According to the website, the game is planned to be launched at the end of this year, targeting PC players. It will initially be available in English and Japanese, with Chinese and Korean languages expected to be added next year.

Long-term exploration of Web3 games through investment and licensing

Shortly after Bloomberg reported that Sega had "temporarily shelved plans to develop its own games of this kind," Shuji Utsumi responded to questions in an email stating that their blockchain strategy had been misunderstood. In the email, he mentioned that considering the recently announced partnership with Line, it would be "very strange" for Sega to exit blockchain technology. He stated that Web3 is part of Sega's business strategy, with the company aiming to build a new phase of the internet around decentralized blockchain technology, metaverses, and NFTs.

In fact, at the IVS Crypto 2023 conference held in Kyoto, Japan on June 29th this year, Utsumi stated in an interview that Web3 is one of the many technologies Sega is exploring. "We don't want to be a Web 3 company. Instead, blockchain and NFT technology are 'functionality' that the company will continue to explore as a way to develop its business and expand the potential of intellectual property (IP)." Sega believes that blockchain technology can make a huge contribution to the growth of the gaming industry and is seriously evaluating this potential through various investment initiatives.

Utsumi mentioned that the company's strategy is to invest in Web3 projects, including authorizing the IP of certain games to blockchain-based developers. They believe that these developers can maintain their quality standards and meet fans' expectations. He also stated that Sega will choose popular games in the Asian market, as gamers in Asia tend to incorporate blockchain technology into their favorite games, seeing it as a form of entertainment. "Battle of Three Kingdoms" is an example of this and an attempt. However, Sega's well-known IPs like "Sonic the Hedgehog" have a long way to go to integrate blockchain technology in both the Eastern and Western markets.