Game Giant Sega's Journey to Web3: Exploring Web3 Games with Investment and IP Authorization

By Zen, PANews

At the end of June, the antitrust lawsuit between FTC (US Federal Trade Commission) and Microsoft was revealed. The latter has always wanted to acquire the Japanese video game company Sega (SEGA), and pointed out that Sega's software lineup has all kinds of products in various market segments. Global appeal. The former game giants didn't care about this. Sega insisted on operating independently, and earlier this year acquired Rovio, the developer of "Angry Birds", for 776 million euros.

The origin of Sega can be traced back to the 1940s. It has a long history, and its development track largely represents the continuous exploration of the game industry in the field of hardware. Although people now mention Sega, the representative works they can think of are the "Sonic the Hedgehog" and "Dragon" series a few years ago, but according to technological progress, they continue to apply new technologies and adjust their development direction, and they still maintain a wide range of influence. .

"Super Game" plan and close relationship with NFT

In May 2021, Sega announced the "Super Game (Super Game)" plan for the first time at the financial performance conference. Invest up to 100 billion yen (about 900 million U.S. dollars) over five years.

At first, because Sega didn't announce the details of the plan, it was misunderstood that "Super Game" might be a single super-large game. But in an interview in April 2022, Sega executive vice president Shuji Utsumi revealed that Sega has developed multiple games within the framework of "super games", and each game will be different, and they will be beyond the traditional game framework. interactive games. He also stated that the "super game" will be a AAA game that integrates all of its development technologies, including the cloud technology and NFT fields that Sega had just set foot in at the time.

In April 2021, Sega invested in the blockchain start-up company double jump.tokyo, and plans to cooperate with it to develop digital collectibles based on the company's game IP, thus announcing its official entry into the NFT field. In its financial report for the second quarter of that year, Sega said "investments in emerging business areas such as NFTs" were part of the future. At the end of the same year, it also applied for the registration of the "Sega NFT" trademark in Japan. However, the player groups of the established game giants did not buy it, just like Ubisoft was opposed by more than 90% of the players after YouTube promoted the "NFT experiment". Sega, which has not yet conducted any NFT sales, is also facing the same dilemma.

Sega reassessed their role in the NFT market following strong negative sentiment from fans. In January 2022, Sega CEO Haruki Satomi stated that they want to try various experiments and have started many different studies and considerations, but have not yet made any decisions on the P2E mode. Sega stated that if NFT content is seen as "simple money making" rather than something that can attract users, it will abandon its plan to explore NFT.

Authorize its IP to a third-party chain game company

A few days ago, Bloomberg reported that Sega’s joint chief operating officer, Shuji Utsumi, said that they would withhold their largest franchise rights in third-party blockchain game projects to avoid IP depreciation, while Sega’s plan to develop its own Web3 games has been put on hold. . Sega also criticized the Play to Earn mode as boring, saying "if the game isn't fun, what's the point?"

This news has just fermented, and the Web3 project Line Next, a subsidiary of the Korean instant messaging application giant LINE, announced its cooperation with Sega. Through the agreement, Line Next obtained the authorization of a "very popular" game IP from Sega, and developed a Web3 game based on it. Launched on its blockchain gaming platform Game Dosi, it will support NFT production, digital payments and marketing campaigns. Launched in May this year, Game Dosi is a Web3 gaming platform that "provides user- and game-centric services."

As Sega’s staunch ally of Web3, the chain game company double jump.tokyo has basically arranged all of Sega’s blockchain-related cooperation. The main development team behind Oasys, the game public chain jointly launched by Bandai Namco and Sega, is from double jump.tokyo. It also logically obtained two IP authorizations from Sega, and used them in NFT projects and blockchain games.

In March of this year, double Jump.tokyo, based on the NFT project OASYX issued by the Oasys blockchain, cooperated exclusively with Sega's classic 3D fighting game series "Virtua Fighter" to launch OASYX's first NFT series "Virtua Fighter". There are 1,000 NFTs in the collection, including 11 characters from the first three Virtua Fighter games. As part of the collaboration, fans can get a limited edition VF "MAYU" NFT, which will contain a special Virtua Fighter character, with an initial sale of 10,000 units. "Virtua Fighter" is widely regarded as the originator of 3D fighting games. It first appeared in 1993, and its popularity was once higher than "King of Fighters" and "Tekken".

"Three Kingdoms War" is a collectible card game set in the Three Kingdoms period of China, the first version of which was launched in 2005. In September last year, double Jump.tokyo obtained the license of the IP and announced that it would develop the blockchain game "Battle of Three Kingdoms" (Battle of Three Kingdoms) with the theme of the Three Kingdoms; at the end of June this year, the game launched a trailer website, in which NFT Cards are a highlight of the game, not only covering the characters in the arcade version of "Romance of the Three Kingdoms", but also new generals cards specially created for this game. Players can build their own decks and participate in battles. The game only takes 3 minute. In addition, according to the information on the website, the game is planned to be launched at the end of this year for PC players. It can be used in English and Japanese in the initial stage, and Chinese and Korean are expected to be added next year.

Long-term exploration of Web3 games through investment and licensing

Shortly after Bloomberg reported that Sega had “put plans to develop its own such games on hold, at least temporarily,” Shuji Utsumi said in an email in response to questions that its strategy around blockchain was misunderstood. He wrote in the email that it was “very strange” to think that Sega would exit blockchain technology given the just-announced partnership with Line. He said that Web3 is a business strategy of Sega, and the company aims to build a new stage of the Internet around decentralized blockchain technology, Metaverse and NFT.

In fact, at the IVS Crypto 2023 conference held in Kyoto, Japan on June 29 this year, Utsumi said in an interview that Web3 is one of the many technologies that Sega is exploring. "We don't want to be a Web 3 company, instead, Web3 technologies like blockchain and NFTs are 'capabilities' that the company will continue to explore as a way to grow the business and expand the potential of intellectual property (IP)". Sega believes that blockchain technology can greatly contribute to the growth of the gaming industry, and it is carefully evaluating this potential by investing in several initiatives.

Utsumi said the company's strategy is to invest in Web3 projects, which include licensing the IP of some of the company's games to blockchain-based developers who they believe can maintain their quality standards and meet fan expectations. He also said that Sega will choose games that are popular in Asia, because gamers in the Asian market tend to incorporate blockchain technology into their favorite games as a "form of entertainment", such as "The Battle of the Three Kingdoms". is an example and a try of it. However, Sega's "Sonic the Hedgehog" and other well-known "ace IPs" in both eastern and western markets still have a long way to go before they can be integrated into the blockchain.