Sega looking in-house for social gaming development


With companies from EA to Disney spending millions of dollars to acquire hot social and casual gaming companies, it might seem like a gold rush mentality has set in amongst the established mega-publishers. Well, the mentality has yet to reach long-lived publisher Sega, it seems. In a recent interview, Sega West president Mike Hayes says the company is hesitant to buy its way into the social gaming market at this point.

Hayes compares the social gaming market today to the mobile gaming market of five years ago, when heavily-hyped-but-unprofitable startups sold for inflated prices. "I'm not saying that about social gaming, but the value of what is current - you could argue is actually too high," Hayes said. "If you look at a lot of famous companies, I won't mention any names, but look at their balance books and they are not making any money."

That's not to say Sega isn't interested in the social and casual gaming markets -- they'll just be focusing on those markets through their newly established San Francisco digital division, rather than by scooping up an existing company. The key, Hayes says, is taking the time to come up with new ideas and models for sustainability, rather than throwing money at a quick cash-in. "Controlled profitable growth in digital is key," he said. "It's nothing we have to rush into and use a lot of money on. It's something some company's need to get into quickly but carefully, and that's exactly the way we're going to approach it."

Originally published