This story was going viral across the internet this morning, and I’ve noticed a lot of posts on it that aren’t true or spread the false impression that arcades are only available in Japan and that Sega is doing with arcades in general. Let’s set the record straight as best we can! GENDA is a Japanese company, is an expert in the management of thousands of arcade machines across the United States. There is even a division in the USA that is known as Kiddleton which is which is a Chuck E. Cheeses-like facility in Texas. The news reported today , but is not correct in all accounts, is that GENDA is buying all SEGA Entertainment Co., Ltd.’s shares. SEGA Entertainment Co., Ltd. What this means is that the places are under new ownership. However, this doesn’t mean those locations are shutting down (see the company statement below). They’ll probably have to lose the Sega name, if GENDA decides, which is a pity for anyone who wanted to go to the «real Sega arcade.» Yes, it is possible that some of them will shut down should GENDA decides to shut down bad locations, but all of them? UPDATE: Famitsu weighs in, explaining that the majority of the funds Sega has devoted to the operations are now going to the development of console games (not creating a brand new console, but simply shifting money and employees to the home game development division). IT also mentions that the places will retain their Sega brand, so you’ll still be able to visit the «Sega arcade» as the time approaches that tourists can go back to Japan to visit again. Here is the Google Translation that explains what they are doing. With the development of an entertainment network that is global our goal is to make people’s lives more enjoyable. Our mission is to improve the «total quantity of fun» around the globe. Presently, we are working on building and expanding our amusement machine rental business and our online game business, our sales promotion business, China business, and Arcade1up table Top US business. SEGA Entertainment’s goal is to bring smiles and positive emotions by providing «fun places». It operates 199 entertainment facilities (including 193 amusement centres) nationwide. We are the third largest amusement center operator in Japan. By collaborating with SEGA Entertainment, we will rejuvenate the industry, both for producers and operators. We can tell that the fun will rise for all of the participants, which includes the end users. We hope to build an amusement industry. I’m still trying to find out whether Joypolis operations are included in this list. I’m not sure, so I won’t speculate. Update: Xavier above mentions that Joypolis operations have been taken over by another person, so this new information only confirms that. This does not necessarily suggest that Sega has stopped making arcade machines. They recently bought stakes in one of their divisions. What do they plan to do with the proceeds through this transaction? I don’t know. However, I haven’t read anything that would suggest Sega is leaving the arcade market, as some claim. Sega is still developing new games and continues to innovate. One thing that we tend to miss in the business here is the fact that the business model for arcades in Japan is different, and it has failed. Most new equipment runs off of revenue sharing to the manufacturer/developer – even when you buy the game cabinet. When you consider the costs associated with the place, such as rent, electricity as well as taxes, salaries and maintenance, the margins for running the company are extremely slim. There is only one system that operates in Japan right now that is bucking this trend: the often discussed exA-Arcadia. The inability to share revs is one reason the platform has performed extremely well in Japan. GENDA appears to be looking to shift the direction of these sites. People who are willing be flexible and change are typically successful. This will be monitored , and we’ll watch what happens. However, we shouldn’t get caught up in all the negativity. In general, there’s lots of potential to grow Japanese arcades. I’ve always been a enthusiast of video games. I’ve run my arcade, Arcade Galactic in West Valley City, Utah since 2008. There are soft spots in my heart are for Atari, Sega, and Nintendo. Newsbytes: Firestone stops lending; CAX 2022; TekyGo! It doesn’t comes unexpected. There’s nothing major to commemorate the 60th anniversary. Corona provides the rest in the arcade section. It’s remarkable that SEGA remains around. There was certainly a lot of misinformation about this news story. The reliable news sources like your site and ours were on the right side of this (as normal) However, many social media posts got it totally wrong. Joypolis isn’t part of the deal as Sega contracted the management of Joypolis to China Animations Character in 2016 by using exactly the same technique as in the present. As we see, Joypolis is still there and hasn’t seen any changes (except for Initial D 4 Limeted replaced with Spicy Taxi; a total regret). This should give you a sense of security. I’m confident that the game centers will continue to be Sega with their own brand. Perhaps the new management will bring fresh ideas to reinvigorate the arcade video game industry.