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1940-1988

Sega was originally founded in 1940 as Standard Games in Honolulu, Hawaii, by Martin Bromely, Irving Bromberg, and James Humpert to provide coin-operated amusements for American servicemen on military bases. Bromely suggested that the company move to Tokyo, Japan in 1951 and in May 1952 "SErvice GAmes of Japan" was registered.

In 1954, another American businessman David Rosen fell in love with Tokyo and established his own company, Rosen Enterprises, Inc., in Japan to export art. When the company imported coin-operated instant photo booths, it stumbled on a surprise hit: The booths were very popular in Japan. Business was booming, and Rosen Enterprises expanded by importing coin-operated electro-mechanical games.

Rosen Enterprises and Service Games merged in 1965 to become Sega Enterprises. Within a year, the new company released a submarine-simulator game called "Periscope" that became a smash-hit worldwide.

In 1969, Gulf and Western Industries purchased Sega, and Rosen was allowed to remain CEO of the Sega division. Under Rosen's leadership, Sega continued to grow and prosper. In the videogame arcades, Sega was known for producing Frogger and creating Zaxxon. Sega's revenues would hit $214 million by 1982 and in 1983, Sega would release their first video game console; the SG-1000 and also the first laserdisc game.

In the same year, Sega was hit hard by the video game crash. Hemorrhaging money, Gulf & Western sold the U.S. assets of Sega to Bally Manufacturing Corporation. The Japanese assets of Sega were purchased for $38 million by a group of investors led by Rosen and Hayao Nakayama, a Japanese businessman who owned a distribution company that had been acquired by Rosen in 1979. Nakayama became the new CEO of Sega, and Rosen became head of its subsidiary in the United States.

In 1984, the multi-billion dollar Japanese conglomerate CSK bought Sega, and renamed it to Sega Enterprises Ltd., headquarted it in Japan, and two years later, shares of its stock were being traded on the Tokyo Stock Exchange. In 1986, Sega of America was established to take advantage of the expanding video game market in the United States. Sega would also release the first Alex Kidd game, who until 1991 would be their mascot.

1989-2001

Sonic the Hedgehog has been Sega's official mascot since 1991.With the introduction of the Sega Mega Drive/Genesis in 1989, Sega launched itself internationally as the second largest vendor of consumer video game products, behind their main rival, Nintendo. 1990 marked a change in Sega's market focus, changing to an older audience than that of Nintendo and marketing their products as such with slogans such as "Genesis does what Nintendon't". Sega also rebranded themselves with a new mascot, Sonic the Hedgehog. This shift led to a wider success for the Sega Mega Drive/Genesis and would eventually propel Sega to 65% of the market in North America. However, Sega's share of the market would plummet in 1994 to 35% after Nintendo released key franchise titles for the Super Nintendo Entertainment System such as Super Mario World and The Legend of Zelda: A Link to the Past.

In 1994, Sega in association with TimeWarner launched The Sega Channel, a subscription-based cable network that provided video games to owners of the Sega Mega Drive/Genesis. Sega also released the Sega Saturn in Japan in 1994 and later in North America in 1995. Although the Saturn performed well in Japan, it failed to captivate the North American audience and thus led to a long decline in the console market for Sega. With one last effort for Sega to redeem themselves from overwhelming debt they launched the Sega Dreamcast in Japan in 1998 and in North America later on Sept. 9, 1999 (with the marketing ploy 9/9/99). The Dreamcast, at the time became the fastest selling video game console until 2000's launch of Sony's PlayStation 2.

Although the Dreamcast had a relatively successful release, it failed to gather a foothold in the market against the Sony PlayStation, the Nintendo 64, and the release of the PlayStation 2, which would dominate the market until Microsoft and Nintendo entered the sixth generation of video game consoles, although the PlayStation 2 would continue its market lead throughout the era.

In 2000, Sega Enterprises Ltd. was renamed Sega Corporation. In 2001 Sega discontinued the Dreamcast and ended its run as a video game hardware manufacturer.

2001 and Beyond

2001 would see a major shift in focus for Sega as they would move out of hardware manufacturing, at least in the home console market; the arcade Sega NAOMI units are still being produced. The company has since evolved primarily into a platform-agnostic software company that creates games that will work on a variety of game consoles produced by other companies, including Nintendo's GameCube, Game Boy Advance, and Nintendo DS, Sony's PlayStation 2 and PlayStation Portable, and Microsoft's Xbox.

In 2003, Sega fell on extremely hard times, and after the death of CSK founder Isao Okawa in 2001, who spent over US$40 billion to help Sega, CSK put Sega on the auction block. The first suitor was Japan's Sammy who discussed a merger, but plans fell through. Discussions also took place with Namco, Electronic Arts and Microsoft. In August 2003, Sammy bought the outstanding 22% of shares that CSK had, and Sammy chairman Hajime Satomi became CEO of Sega. With the Sammy chairman at the helm of Sega, it has been stated that Sega's activity will focus on its profit-making arcade business rather than its loss-making home software development.

During the middle of 2004, Sammy bought a controlling share in Sega Corporation at a cost of $1.1 billion, creating the new company Sega Sammy Holdings, one of the biggest games companies in the world.

Sega recently bought the rights to all output from Sports Interactive, makers of Football Manager (the old Championship Manager).

On January 25, 2005, Sega sold Visual Concepts, a second-party developer known for many Sega Sports games including the ESPN NFL Football series (formerly NFL2K) to Take Two Interactive for $24 million. The sale also came with Visual Concept's wholly-owned subsidiary Kush Games. Take Two subsequently announced the start of the publishing label 2K Games because of this purchase.

On March 9, 2005 Sega acquired developer Creative Assembly best known for their strategy games Medieval: Total War and Rome: Total War.

This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Sega".

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