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The Early Years

Sega's roots stretch back to 1940 and a Honolulu-based company called Standard Games, formed by Martin Bromely, Irving Bromberg, and James Humpert. In 1951, Bromely inspired the company's move to Tokyo, and Service Games of Japan (also known as Sega) was officially registered in May of 1952. Initially, Sega provided coin-op machines to U.S. military units stationed in Japan. The business branched out from there, supplying the domestic Japanese market as well as parts of Asia and Europe.

In 1965, Sega merged with another coin-op company, Rosen Enterprises, Inc. Formed by American entrepreneur David Rosen in 1954, Rosen Enterprises dealt in everything from instant photo booths to mechanical arcade games. A year after the merger, Sega released Periscope, a submarine simulator that became a worldwide hit.

In 1969, Rosen and the other shareholders decided to sell Sega to Gulf & Western Industries, with Rosen continuing on as CEO. Gulf & Western continued to build on the company's original product and marketing strategy, with revenues hitting $214 million in 1982. By 1983, several "firsts" were introduced, including the first laser disc game, Sega Astron Belt, the first 3D video game, SubRoc-3D, and Sega's first consumer video game console, SG-1000, all marketed in Japan.

The arcades and the U.S. home market crashed shortly after. Gulf & Western, which had spun off 20 percent of Sega, bought back the public shares and sold the U.S. assets to Bally Manufacturing Corp.

However, in Japan, Sega survived. Back in 1979, Rosen had acquired a distribution company founded by a Japanese entrepreneur, Hayao Nakayama. Following the crash, Rosen joined Nakayama and other Japanese investors to buy the Japanese assets of Sega for $38 million. Nakayama became chief executive and Rosen headed the U.S. subsidiary. From that point forward, the company vowed not to stick with one concept too long, since each generation of technology has a life and death.

In 1984, Sega Enterprises was bought by a partnership between Sega Enterprises Japanese management and CSK, forming Sega Enterprises Ltd., a Japan-based company.

Mike the Foxhog

Oct 9 2008, 07:53 AM

Sega's American? Cool.

It's like learning that Nintendo has apparently been going for about 100 years and started off making playing cards.