Sega arcades have been a staple of Japanese cities for over half a century. Now, the company has announced that it is leaving the arcade business for good after 56 years. Sega began divesting from its arcade business in 2020 when the pandemic hit the industry hard. Sega closed one of its most iconic arcades in 2020 and sold 85% of its shares in the Japan arcade business to Genda. Now, Sega is selling the remaining shares to the company and exiting the market altogether.
Sega arcades in Japan will now be rebranded to GiGo which is an acronym for “Get into the Gaming Oasis.” The removal of the Sega name will change the landscape of Japanese cities as the arcades bearing the Sega name have become famous in their own right. Sega arcades can be seen in a variety of games set in Japan such as the Yakuza series and Akiba’s Trip.
The arcade industry in Japan has continued to remain incredibly popular. Japan never saw the steep arcade decline that other countries did. Whereas gamers in other countries moved to home consoles in the late 80s and early 90s, Japanese gamers continued to appreciate both. On any given night, arcades in Japanese cities are filled with players to this day. Having said that, the industry has been suffering a slow decline in the country. That decline seems to have been hastened by the pandemic. Like many other entertainment options, arcades have been periodically closed in Japan as COVID has surged through the country at different times. When Sega sold the first 85% of its shares to Genga in 2020 the company cited “extraordinary losses” for that year as one of the reasons.
Since Sega is now selling its remaining shares in the arcade business, it must not expect for there to be a significant turnaround in fortunes for the Japanese arcade industry.
