President and COO still believes "there is a business opportunity" in live-service games, and "will continue to pursue [it]"

Sega cancelled its live-service Super Game initiative earlier this year as "taking on this challenge at this time would be too risky."

Announced in 2021, the project was described as an "online AAA global hit" that would "go beyond the traditional framework of games." Sega indicated it might invest nearly $1 billion in internal development and acquisitions to achieve this goal.

In an interview with Nikkei (via VGC), Sega president and COO Shuji Utsumi stated the company realized it "would have to grow enormously to match the scale of the service, and we began to see the challenges involved."

"Within the gaming industry, Games as a Service is an area we simply cannot ignore," said Utsumi. "If we can successfully roll out an IP we created from scratch on a large scale globally, the rewards would be immense."

"We hypothesised that we possessed the necessary technology and attempted to pursue this, but as we proceeded with our analysis, we realised that the scale of investment and operations would have to grow enormously to match the scale of the service, and we began to see the challenges involved."

He continued: "As a result, taking into account the global situation, we determined that taking on this challenge at this time would be too risky. That is why we halted development of Super Game. However, I still believe there is a business opportunity here, and we will continue to pursue this business."

Utsumi emphasized that Sega remains active in the live service market with titles such as Phantasy Star Online 2: New Genesis, Sega Football Club Champions 2026, and Creative Assembly's Total War: Warhammer 40,000, which will enter closed beta testing this year.

"[It] is also expected to be a Games as a Service-style title that will continuously expand its game world after launch," Utsumi noted.

Sega incurred a live-service loss with Creative Assembly's Hyenas, which was cancelled in 2023 due to "structural reforms" and a "rapidly changing business environment."

Several studios and platform holders have faced challenges operating live service games and maintaining recurring revenue. Sony is a frequently cited example, and Sega is now encountering similar issues.

One company that isn't backing out is Tencent, which recently told GamesIndustry.biz that its "holy grail is live service."

"You look at Tencent's DNA, it's Honor of Kings, League of Legends, Valorant," said Yong-yi Zhu, VP and head of operations, strategy and compliance at Tencent Games.

"They're games that build upon themselves, and it provides stability to the studio, it builds communities. And I think more and more games are about not just engaging people for a short period of time, it becomes a lifestyle."

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