Sega of Japan has confirmed that it will end production of the Dreamcast games console at the end of March. The company has said it will restructure its business to focus on selling software to Sony and Nintendo. It is presently negotiating with Microsoft with a view to selling software for its forthcoming Xbox console.
In a statement, Sega said:
"It is becoming difficult to run businesses both for software and hardware that promises growth on growing sales. Therefore we have decided to swiftly implement a more content-oriented business in order to secure profitability."
The Dreamcast, launched in Japan in late 1998, failed to win popularity, suffering from a lack of game titles, and it generated enormous losses. However, the move to software has been expected for some time. As long ago as November 1999, Sega's Chairman Isao Okawa said that Dreamcast would be Sega's last console and that the company would move out of the hardware market.
Sega Europe has said it will now deliver Sega games to Palm handheld computers and Motorola mobile phones.
See also:
Sega could give up on Dreamcast and work for rivals, OUT-LAW News, 24/01/2001