Why Isn't SEGA Overprotective of its Intellectual Property?

[@poisonshroom64]

I think it is important you pointed out how Sega's fanbase is a lot more prone to backlash than Nintendo is. While Nintendo will always have their army of drones, I'll bet that (at least in the sonic department) Sega is aware that their brand loyalty is a lot more volatile if they start playing hard ball with them.

[@topbossgamer15]

True and yes Sega does have it's fair share of drones (me being one of them I I'll admit)

[@shocksconstant]

I don't know how loyal those so called drones are since its very clear that fan backlash and abandonment will absolutely crush Nintendo as seen by the massive bomb that was the Wii u. Despite that, throughout the whole Wii u era Nintendo were just as prickly about fan works and such as they are now.

[@EWOODJ]

What company doesn’t? No one is innocent and hypocrisy is rampant. It’s easy to play the drone card when what one favors most isn’t involved…until it is… Remember the PS5 price increase? There were actually people defending it. And you know what? I’ve noticed all over the internet that many of those same people are the *exact same folks* who scream “Xdrone” or “nintendrone” and the like any chance they can get, even when it makes no sense to do so. Brand loyalty is a dangerous thing.

[@sausagesausage]

SEGA fans, even loyal ones, won't go to bat for SEGAs worst moves. Nintendo have an army of fanboys who'll argue on the side of the worst possible behaviour.

[@Barakon]

They also make more than just vida gams so, yeah, they can afford to do so.

[@mikebliss1835]

"We are going to read some terribly exciting annual investor reports." He said, with a smugly evil smile.

[@ItsHyomoto]

People love to speculate, I love to read the investor reports. Recently a kerfuffle was made that paradox was "killing" Stellaris because it was greedy and had greedy shareholders. Okay, if we believe that: what are they telling shareholders? Oh, that Stellaris is one of their top earners and projected to continue through the next yearly cycle. Neat. So, yeah, it can be kind of exciting to read them if you genuinely want to know what/when/where/why outside the perspective of the hype cycles presented to fans.

[@tbotalpha8133]

@@ItsHyomoto It's fascinating - investor reports are the one place where these companies are *actually honest.* Certainly far more honest than they ever are with their consumers. Makes me wonder what might happen if consumers at large ever start realising that. And these companies have to come to terms with the fact that the audience for their reports now includes their consumers.

[@ItsHyomoto]

@@tbotalpha8133 It's an interesting question. It would be challenge to square the circle of telling your financier what they want to hear while your mark is listening, but they largely do: there are no reports that say "we intend to remove value from our products and fire our employees to bring you returns!" It's all, "We intend to provide the best value to our customers, maximize recurrent revenue, and optimize our teams to minimize risk and streamline delivery!" That *said*, these reports are sanitized so investors don't have to feel bad about investing in a company who will encourage addictive consumption: if the customers were reading them, the noise around how products are being made and marketed to support their earnings might make them less palatable.

[@demetriusnp49]

@@ItsHyomoto Probably why SegaSammy enforce Sonic as a ‘face’ to the fans of doing anything they want to them in their boundaries to fluff up their image. But more people are starting become aware of the backstage reality of the company. It’s just a matter of *when* that perception overwhelms the toxic positive nature of the online presence of the Sonic fanbase.

[@Mavendow]

​@@tbotalpha8133 They'll paywall or lock down EDGAR, that's what they'll do. It's quite obvious. After all, why does someone who owns 1 share of a billion-dollar corporation need to know the quality of what they're investing in? Get gud, scrub. Only then ye can have ze data. Never mind the fact that's circular logic, but hey, who ever said markets were fair?

[@traxiom4677]

So the "dark age" started right when the merge happened. Makes me wonder how Sonic Unleashed managed to be so polished and ambitious in the middle of all the corporate meddling. This video made me appreciate Sonic Team way more.

[@leaonidasgames4277]

Sonic Unleashed is an exception, it's still the game with the highest budget ever given for a Sonic game

[@Ergeniz]

Unleashed is still the best game of the boost era, mechanically and production wise. IIRC, another reason it was so polished was due to the development team, many of which were no longer with the company after that game. It explains why I felt underwhelmed with Generations.

[@leaonidasgames4277]

@@Ergeniz tbh I personally felt underwhelmed after Unleashed already, and Generations was the only game after that I enjoyed

[@Hugo-yz1vb]

Sonic Unleashed is probably the most polished Sonic game to this day and probably the best 3D Sonic game too

[@Ergeniz]

@@Hugo-yz1vb Yes, I would actually play it over SA1/2

[@crashboombang9968]

My GOD this video was incredible. I genuinely don't understand how Sammy managed to keep all this under wraps for so long, because it puts so much of Sonic's dark years into a completely different perspective. Absolutely fascinating and makes me reconsider a lot of things. Thank you so much for making this.

[@JimmyFantage]

Because most Sonic fans were kids and didn't look into it.

[@NotaPizzaGRL]

@@JimmyFantage It was the teenage and adult fans who tended to be more vocal and harsher from my experience. Then you had the Internet drama addicts who would find any fool who happened to like Sonic and they would parade them around for clicks and attention. Combine that with the drop in game quality and it turns into a pretty stupid and toxic situation.

[@hazelcrisp]

@@NotaPizzaGRL It's so hard to say I like Sonic to someone without them bringing up Sonic 06, Forces or Boom.

[@stillaproudomorifan]

can someone explain the video in simple terms

[@ordinarytree4678]

@stillaproudomorifan People like this person is why financial entities like Sega Sammy and Blackrock get away with shady stuff. They obscure their dealings behind closed doors as much as possible and when they must record things in public they do so with legal vocabulary that most people cannot follow, let alone children let alone anyone with any kind of dyslexia or of lower IQ. A good 60% of all people cannot understand legal speak or read investor reports. It is no surprise that these dealings remain hidden when they want to be.

[@ReijiArisu1211]

Also somewhat relevant, is the reason why Sammy distances itself from Pachinko. The laws have changed since a few years back. SNK, Konami have dramatically slowed down their Pachinko businesses. First : Teens don't play Pachinko. The Bayonetta Pachinko machine wasn't very effective in bringing younger audiences in Pachinko. The player base is shrinking Second : Gambling in Illegal, as in "It's up to luck and not skill, like in card games. The player doesn't have control in whatever cards comes up", but in Pachinko there is a bit of player control, that's supposedly makes a difference in the eyes of the law. And you can press buttons, so it does create the illusion of skills. Third : During the Olympics 2020, SNK, Sammy and Konami figured it would be the perfect time to have all those foreigners play too. Growing the player base and spread the craze to the world. But for that to be allowed, it would be easier without this fake money pawn shop stuff. So they asked for gambling to be legalised. So a test run was performed by the government. So now all Pachinko machines have to pass inspections from the governement. So the governement can regulate the RNG and give the player a fair chance of winning. Any machine the doesn't pass inspection is rejected. An inspection can take 6 to 8 months. And you have now to pay Regulation fees from the Governement. TLDR : The player base is shrinking, attempt at legalising casino screwed Pachinko. A new law passed on July 20 2018 legalizes the construction of casinos in Japan, with the aim of supporting its economic growth. But now it means the governement must inspects machines to limit RNG and addiction. Such inspections take 6 to 8 months and you make less money out of it. Pachinko's profit has been divided by three.

[@SpaghettyLuvsU]

Interesting info, thanks! Maybe we can get a half decent Castlevania before too long

[@bclxprss]

@@SpaghettyLuvsU If that ends up happening, it won't be due to the decline of Pachinko. Looking at Konami's investor reports, Pachinko has never accounted for more than 10% of its revenue in the past decade. In contrast video games have always accounted for the majority of their income.

[@Toksyuryel]

This also explains the rise of gachapon, because it offers the added plausible deniability that the toy is what you're playing for rather than what you could potentially sell the toy for. Which also makes it legal for children to play.

[@LuizAlexPhoenix]

This whole story is just a Yakuza plot without the bare chested dudes fighting atop skyscrapers.

[@bluesmcgroove]

@@LuizAlexPhoenix We don't know if there's bare chested dudes fighting atop skyscrapers though. They very well could be XD

[@just_dondre3376]

This video puts into context so many things about this franchise ive always loved sonic and wondered why the games had such mix of amazing and terrible games but now knowing the circumstances behind them makes me realize how much of giga chads sonic team developers are they made colors and generations with low budget and upper management interference my respect for them has increases immensely

[@moon-channel]

Sonic Team gets a terrible rap, and it's really just such a shame. Sonic Team is like Sega's Special Forces, but they are routinely given insufficient development time and resources to make their perfect game. Oddly enough, I do think something is on the horizon for Sonic though. The latest investor reports harp on quite a bit about a super game: some kind of must play killer app. It makes me wonder if Frontiers was a test-bed for that idea, but this is conjecture too far! Maybe we can explore that hypothesis in a video someday!

[@demetriusnp49]

@@moon-channel Their Super Game is regarded to the rumored live service idea, due to them wanting to get close to Microsoft.

[@gottagolast]

​@@moon-channel Could the "super game" be the next sonic game being developed by hardlight (developers behind mobile sonic games) since you said "app" instead of "game" and app makes it lean towards a mobile game rather than a pc or console one

[@Swaggless]

@@gottagolast The term "killer app" is kinda misleading, as it doesn't necessarily refer to a phone app. Any big game (especially big platform exclusives intended to incentivise hardware sales) can be referred to as a "killer app". That being said, a big game from Hardlight isn't off the table. I believe they were staffing up for a new project not that long ago.

[@obeyabe8613]

@Moon Channel Super Games are more or less live service games of old arcadey SEGA IPs. Iirc, they're currently making one for Jet set radio and Crazy Taxi. I'm personally excited cause I think arcadey style games could definitely work with Agile Style development cycle. As for Sonic, in their latest Shareholders meeting, they said they're adding more manpower and budget for the games while also promoting its Creative Officer Takashi Iizuka to an executive level for the Sonic IP. I assume he has more authority in the meetings instead of disputing to his superiors to delay the game (like Frontiers 💀). So ig you were right regarding the future of the Sonic brand. Imo, it is best to find a golden line between PR and the quality of the brand, I've been a fan of Sonic for over 15 years, and even I can admit that I felt alienated in the 2010s. Where the games barely had any effort put into them, and the stories were awful. As for the fan content, it is best for sega to be stricter than "just don't monetize it, and we'll turn a blind eye." The Sonic Fandom is weird as is, and the toxic side genuinely harms the PR.

[@DexDexter0]

The penders thing was so bizarre to watch unfold in the comics. Some dude called thrash the devil just walks in, throws all the non Sega characters out, and then the universe gets chaos controlled into a completely new one.

[@9r0t0typ3]

it was easier then explaining to people that this guy wanted to sue sega for characters he did and didnt create. (some like knuckles already existed but he fleshed the character out but didnt create it.)

[@mikhaelgribkov4117]

For Penders shitty bs and drug trip of writing him working on company that couldn't even give a proper copy of contract and which treated creatives like trash does give him some sympathy points.

[@_thecurator]

Good God ken penders hit me like a jump scare.

[@chiron_2763]

his writing made it so difficult to read the archie comics, i was so close to just dropping them completely.

[@adude1555]

My god it all makes sense now. Not just the copyright thing, but Sonic as a franchise in general

[@ameliawalker1046]

Indeed, Sega along with everyone that works underneath them and the toxic parts of the Sonic fan base have relinquished all responsibility towards Sonic as a character and franchise. Which is why my antidote is a CGI remake of Sonic X that will serve as the closing chapter to give Sonic his happy ending!

[@Tuss36]

I sent an email once to a company they work with for music asking permission to use a song in a video (that I haven't actually made yet). After getting through the language barrier, they linked me a place I could buy the music, but said it wasn't an official license as: "SEGA allows fan arts, but does not provide no material, other than stated in its web site. * to put all fans under equal condition." My read being that they don't play favourites when it comes to fan works, which was interesting to learn.

[@wubbers662]

interesting.

[@endeav0r_49]

So basically, they allow people to use their materials in fan works but do not provide those materials and say it's up to you to acquire them? This really feels incredibly vague in the way that best can screw fan artists over potentially

[@Nomethod64]

@@endeav0r_49true. But it also means that SEGA can say “We didn’t provide assets” when someone makes uh… QUESTIONABLE artwork of the characters they own

[@andred.3687]

@@Nomethod64Exactly. I doubt SEGA would want to screw over someone anyway, seems really rude to think that honestly

[@primus0348]

It still does get me thinking, does this mean that even when sonic becomes popular again, they will still allow Fan Content or no? i know the video Did make it seem like that peace wont last long but im actually curious if they actually allow fan content but do it in a way where they can still keep Ownership and Prevent another Ken Penders

[@kindoflame]

I love the perspective you use to look at the gaming industry. Few people try looking at it from a legal perspective, and those that do usually stop at just what the law says. The way you analyze why gaming corporations use the law as they do really adds a lot to the conversation.

[@crystalvulpine2314]

99% of people think the law dictates morality

[@sock2828]

I'd love to see a video about Valve next. They not only allow fan games, they allow them to be sold on their own platform.

[@moon-channel]

A video about Valve might actually be a good idea. Valve is extremely unique -- remember the part in the video, where we talked about how going public means being a prisoner to growth and shareholders? Valve is a massive corporation, with a valuation of $7.7 billion as of May, 2022 (as per Bloomberg). But Valve is privately owned -- in fact, it's majority owned by a single person: Gabe Newall. And whereas SegaSammy has things like gambling income to account for, and Nintendo is highly reliant on its brand, Valve makes its money primarily as a digital distribution platform. In short, Valve doesn't need to obey everyone else's logic, to some extent: only Gabe Newall's. And Valve isn't playing the same game that Nintendo and SegaSammy are, per se.

[@mr.shplorb662]

​@@moon-channelYes! Please do a video about valve, that would be awesome!

[@IkeOkerekeNews]

@@moon-channel People Make Games's recent investigations might be a good start for more detail into Valve's corporate structures.

[@twenty-fifth420]

@@moon-channel I also want to inquire on a valve video but on the negative aspect. There is a video by a youtuber who I normally do not like but I cite called the Act Man and his video the Rise and Fall of Valve. Valve is probably imho the Sammy of the US games industry, with a mix of selling collectibles, loot boxes and whatnot else. Artifact was a card game which was heavily expensive to get into even for a new card game of its size with steep competition.Not to mention the Steam Gambling Accusations with CSGO items and other unlockables to be sold on the steam store. I would argue this is not as bad at first glance, until you realize Valve has a reputation closer to Nintendo in the gaming community. (IE: Very positive, loyal fanbase). I think this all should be looked into. Valve is also unique in it is privately owned. People Who Make Games also did a video on Valve’s practices and the developers working there. Also recommend that too.

[@twenty-fifth420]

@@IkeOkerekeNews Second this!

[@piousthepious]

As a law student I love this kind of stuff and I feel like I can share it with friends that aren’t as into law and still get a lot of value from it. I would love more videos like this!

[@teafordaniel809]

I'm starting law school this fall! Got any advice for a upcoming fresh 1L?

[@kingstarscream3807]

@@teafordaniel809 Don't underestimate the other law students. They are highly ambitious and usually come from white collar families with university-educated parents and lots of money. I knew this going in, figuring it was common sense, but the hardcore tendencies and class divide of the other students still caught me off guard. Law students remind me of AI in video games: they are beatable, but they won't make silly mistakes like a human would. They've been trained and conditioned from a young age by elite parents to succeed at any cost. I'd also recommend using CANs from the very beginning. Some profs of mine would recommend avoiding CANs, the idea being that you won't learn the cases as well if you checked someone else's notes or summaries before reading it yourself. However there simply isn't enough time to learn everything expected in that ideal way except for the most genius and disciplined of students. Also write practice exams and then write more practice exams. Success at law school means being skilled at writing 100% exams, which is only incidentally related to one's ability to understand and apply the law as it would be used in real world settings. My career prospects after law school would've been much better if I had received these pieces of advice before I started law school. Best of luck to you, friend.

[@amentco8445]

why hold up this system?

[@piousthepious]

@@teafordaniel809 Find good friends you can trust. Be honest and fair even if others are not, it’ll go a long way. Take some time when you’re extremely stressed to lean on some of those trustworthy friends. Outline early as opposed to last minute. Above reply is good but I actually had a completely different experience that I really do attribute to the uniqueness of the law school I’m going to.

[@piousthepious]

@@amentco8445 what?

[@NoBillsOfCrashDamage]

This clarifies so much about the different approaches Nintendo and Sega use for IP protection, as well as the inconsistent quality of Sonic games. It would have never crossed my mind that a gambling company was responsible for such things. Now I wonder if Sonic having recurring casino levels was just a coincidence. It seems we may start to see Sega be on the same level of aggressive protection as Nintendo in the near future. If it happens, assuming it hasn't already, I'm curious to see how the community will react.

[@pablocasas5906]

Nah, Sonic had casino-themed levels since Sonic 2 back in 1992. Though I wonder if they were inspired by Sega's amusement games. Many gamers don't know but companies like Sega, Namco, Konami and Taito began making electronical games and gambling machines before making video games. Sega also used to make pinball machines

[@thatitalianlameguy2235]

It explains why they have so many arcades and gambling in yakuza

[@TornaitSuperBird]

@@thatitalianlameguy2235 Club Sega itself is basically a casino/arcade all in one.

[@batmanarkhamvengeancetm6358]

Also doesn't help that, like a few other Japanese game companies, Sega has always had ties to the actual yakuza. Thus explains Sonic's consistent gambling references and the yakuza franchise.

[@nikkihedged]

@@batmanarkhamvengeancetm6358 no it doesn’t lol

[@ArcadeAwesome]

When it comes to DMCAs, I think Sonic is an exception for SEGA because Sonic is their biggest IP. Sonic fans are insanely loyal to the character and keep him alive and relevant even when there's long gaps for official Sonic content. Sonic is so special of an asset that SEGA can experiment with the character and not worry about destroying the IP because the fan base is so dedicated.

[@Cyanxddd]

That explains why Sonic Boom didn't really kill the franchaise

[@ArcadeAwesome]

@@Cyanxddd Boom had bad games, but the show was actually amazingly good. It wasn't given a fair chance from the community at all. The character designs were weird too, but Sonic was very much still Sonic.

[@Cyanxddd]

@@ArcadeAwesome the show was good but just very different from what the fans expected. It's just like Cars 2

[@Soulfin]

​@@Cyanxdddalso what the hell happened to Shadow.

[@Popcoolman123]

“Ya know you cant really break something thats already in 17 pieces and being held together by craft glue”-some guy probably idk

[@AkameGaKillfan777]

The way you described SEGA wanting to keep their image of: "we totally like our fans and encourage fan projects!" explains the reception of Sonic Mania pretty well. Everyone thinks SEGA is so nice and respectful of their community, ignoring what Christian Whitehead, Tee Lopes, Stealth and all the others actually went through to get CONTRACTED, NOT HIRED, by them. People can be so gullible.

[@Blanktester685]

Bud no one thinks Sega is good lmao, dont pull shit from thin air

[@tikimillie]

Whats so bad about being contracted? So long as you get paid

[@ItsHyomoto]

The Sonic Mania thing is interesting because it was probably a "easy" win for them: a popular Sonic game, fan goodwill, with a low cost. But I imagine they were careful to avoid another Ken Penders incident. It's an inherently risky venture for them, so as has been discussed in both videos the trouble getting contracted is probably the major hurdle: you want an easy PR win, but will that outweigh the cost of making it happen and doing risk assessment? Apparently they thought so, but doing their due diligence isn't Sega being cruel, it's proof that as the value of an IP rises, so too does the vigilance of the people who own it.

[@bluestar5812]

@@ItsHyomoto People forget that before Mania Taxman and Stealth had proved themselves to Sega they were competent and trustworthy people. Before Mania they had ported Sonic CD, 1 and 2 to modern platforms using their engine. The Mania Team aren't just fans, they are game developers who happen to be Sonic fans. And Sonic Mania probably wouldn't exist if Takashi Iizuka haven't sided with Taxman and give his vote of approval to Sega's top execs. Sega is more protective of Sonic's IP than people realise, especially after the Ken Penders lawsuit.

[@AkameGaKillfan777]

@@Blanktester685 Don't you dare tell me I'm making this stuff up. Whenever some random mod pops up online, Sonic "fans" will start going apeshit at how incredible it is and how SEGA should hire them. Mania started this mindset, and Omens enforced it. With Project 06, there are always some neanderthals on videos who say the Creator needs to pitch it to SEGA to make it official, even though he's stated before that he DOES NOT WANT TO WORK FOR THEM. What do I possibly have to gain from making this up? I really wanna know.

[@ifjNagyMiklos]

Reminds of WoTC situation. They had a once popular brand so they decided to revitalize it by OGL, which essentially allowed 3rd party content creators to make extra content for their game with basically no restrictions, and it was a huge success. But than, two decades latter, they tried to revoke it, and saying it had disastrous consequences would be an understatement.

[@bobbycrofts9241]

Interesting, but whichever game? May you please unabreiviate it?

[@Ergeniz]

@@bobbycrofts9241 He's referring to D&D. Its pretty obvious.

[@bobbycrofts9241]

@@Ergeniz mayhaps to you, however i only know dnd by edition and pathfinder, so i couldnt figure it out on my own. Thanks for the reply though

[@Archenoth]

@@bobbycrofts9241 it's true! we all have gaps in our knowledge--there's nothing wrong with that~ But yeah! The tl;dr of that whole sitch was that Wizard of the Coast updated their Open Game License in a way that retroactively would give them ownership of all Dungeons and Dragons fan creations made under it, which understandably created a pretty substantial amount of backlash. The backlash was big enough that WoTC did an about-face and ended up moving D&D to a creative commons license to show that, not-only would they never do that again--it wouldn't even be possible

[@Her_Imperious_Condescension]

That was a shitshow but I don't want to heap Wizards with 100% of the blame. Hasbro, who owns them, has always been pretty scummy.

[@kennylauderdale_en]

Sonic was absolutely more popular than mario here in the United states for around 3 years from 93-95. I think SEGA-Sammy just never understood that was true of more than the u.s., or maybe never realized that at all. With the advent of the internet though, yeah, that had to have woken them up. The whole Ken Penders thing is also a great point. That was their Nintendo Vs. King Kong wake up call.

[@AkameGaKillfan777]

I think it was mostly SEGA shooting their legs off which lead to the near death of the company

[@XperimentorEES]

@@AkameGaKillfan777 Strange to see nintendo following suit in recent years isn't it?

[@AkameGaKillfan777]

@@XperimentorEES Not really? Nintendo hasn't actually suffered a financial loss year since 2014

[@fqnfinancas3431]

91 a 94

[@gregoryfuller9736]

Saga released a much unfinished sonic games that was rushed Nintendo will never rushed a Mario game

[@ArcadeStriker]

The SegaSammy explanation about their aggressive development schedule, lack of regard for game quality over their wider media appeal for Sonic as a brand really feels like something that could have been brought up by someone before but somehow this is the first time I ever hear of this; yet it is great to have an optimistic note at the end with how Sonic's biggest success yet with Frontiers might lead to far better things for the players as well as for media outside of the games. If anything, that thing that Sonic Team had confirmed about the staff reportedly, FINALLY being allowed more development time for their next game and wanting to build on what Frontiers did, does mean that they are now willing to let Sonic's full potential at Sonic Team's hand to bloom (even if the reason is because the poential shown = big cash for them if done right...but at least we'll get things right this time around, right?) I fhave the feeling like this video will really blow up, not only because of the superb research but also because it sounds like it will spread like wildfire in the community as such an in-depth explanation of circumstances around the franchise up to this point.

[@moon-channel]

In the latest investor reports, SegaSammy puts a pretty big focus on the idea of making a "super game" -- a sort of Triple A, must-play killer app. I may be reading too much into their statements, but I would not be surprised if Frontiers was a test-bed for that concept, given all the changes we've recently seen as well, regarding Sonic Team and the Sonic franchise as a whole.

[@demetriusnp49]

@@moon-channel Y’know what sucks? Even if SegaSammy’s plan is to be bought out just to move to America for the foreseeable future, they kinda already doomed themselves. They should’ve made the plans during the 2010’s when all went belly up. The quality of Sonic is still up in the air, and investors only care for that brand recognition than quality and consumers. Should their ‘Super Game’ live service go belly up, then that will be the nail in the coffin for them to sell off their assets to companies who can make the IPs work. The fans already have a leg up on the company in generating interest more than them, and the toxic nature of consumerism doesn’t help either. Just moving to America won’t fix everything, because the laws here have their own problems and is reflective in Sony and Microsoft’s mindset when coming to games. It’s this kind of business talk that more people NEED to be aware of. I get it, it’s hard to talk about because you want to pretend that everything is fine, but…this is reality. It’s. Just. Business. And hey, even if SegsSammy does go under, just means the IPs have a chance to start over and perhaps be even better. There’s nothing wrong with that. Wouldn’t you agree? Once again, thanks for making this video, glad my comment on Nintendo helped push this out. I wish you luck on your future videos! ❤

[@moon-channel]

@@demetriusnp49 Thank you for your insightful comments, Demetrius. I'm very grateful. We'll see what happens with SegaSammy -- there's a lot for them to fix, but also a lot for them to leverage!

[@demetriusnp49]

@@moon-channel It depends on what they see as a potential venture, which also works in reverse on what to axe, pachinko ain’t going anywhere. They have a habit of joining a trend at the last possible moment starting in the 2010’s to now, even then executed poorly. But that isn’t to say that any company in that position can bounce back, for Sega it would take more than just a few good games…we’re talking a few years. That is…if they don’t drive out people with their poor management again. And before anyone points to me with their recent 30% salary increase compared to Nintendo’s 10%, the Japanese government forced that new rule into effect. The difference is Nintendo of Japan has always looked out what helped long employment opportunities and relationships, same with their subsidiaries. SegaSammy on the other hand RARELY does it or just doesn’t seem to have the knowledge.

[@loserghoul]

@@moon-channel there has been talks of the next game having far more funding which is both great and potentially bad news. here's hoping the next sonic game doesn't suffer from corporate meddling and what SegaSammy thinks investors want.

[@kordianronnberg9090]

This largely scary film is one of the most revealing gaming materials I've seen in recent years. Thank you very much from the perspective of a fan of old Sonic Team and Am2 games, a graphic designer, and a novice developer. All the best!

[@Solesteam]

41:34 I hope beforehand they give the fans a warning at least saying something along the lines of: "Hey, since Sonic is doing much better in terms of funding for Sega's works were gonna have to tighten our grip on what we allow to slide, please save or backup your fanworks to offline incase we may need to take legal action to avoid any loss of properties." So that they can at least still keep that good easy going with Sonic reputation while also being strict, unlike Nintendo who to nearly everyone looked like they suddenly went berserk on their fandoms without warning one day and remained the mean math teacher of the corporate world since then.

[@symbiote1982pk]

Common sense should tell you that if you're using someone else's IP chances are they'll tell you to knock it off, it's not their responsibility to think for you.

[@Solesteam]

@@symbiote1982pk But the thing is, Sega doesn't, they built their whole relationship with the consumer based on this relaxed system... It's become their responsibility at this point, they let it happen, so anyone with any shred of decency would put out some kind of notice before storming everyone and everything. You could make the same claim that if you put it in the terms of service you can cancel a consumer's subscription service suddenly and with no refund due to an overhaul being made to their whole system, just because you can, doesn't mean you should.

[@qactustick]

@@Solesteam But because they can, there's always the (likely) possibility that they will. They don't have any obligation to extend any courtesies to the fanbase. Remember, as this video shows, this 'goodwill' was little more than part of a growth strategy. If that growth strategy is changing in a way that 'goodwill' is no longer necessary or especially if it's antagonistic, you can be sure it'll be gone in the blink of an eye.

[@Solesteam]

@@qactustick Still wouldn't be beneficial to make a sudden 180, there will be backlash, hurt feelings and the chance a lot of people will try to boycott purchasing sega products, which won't do them any favors. It's not like once Sonic becomes profitable their goodwill will become immediately and entirely useless. They'd have no choice but to take it slow. (And then again you people seem to think the word "hope" means strictly demand, I never said it's their responsibility, I said I hope they do that. I can also hope the sky turns green and rains disco balls but it's not like It's going to happen.)

[@greenstarforce001]

I'm kind of hoping they pull a similar thing to ZUN (of Touhou Project fame) and say something among the lines of "You can make Sonic fan games as long as (1) You don't earn money from it, (2) You clarify that you're not affiliated with us, (3) You don't use our assets (models, sprites, music, etc)"

[@islaamN]

So hey! I haven’t finished the video yet (cuz i have some errands) but can I just say how well put together this video is? Everything from an intriguing yet simple title, the thumbnail stands out, and the editing is great. Really enjoying it so far Moon! Well, I’ll be back to finish the video later Godwilling!

[@corruptor55]

Alongside your Nintendo video, I really liked this one, as it shows how different circumstances lead businesses to make such contrasting decisions. Nintendo’s IPs were practically golden gooses for profit, so it protects them even at the cost of “less important to profits” fandoms. Meanwhile, SEGA was eventually led into a situation where Sonic wasn’t that important to company revenue, so it loosened their grip to focus on what was actually making it grow. At least, that’s how I view this sheer contrast. Although it got confusing around the middle - when you were talking about lawsuits - you gave a concise summary before moving on to the next section(as with every other). I never knew topics relating to corporate law could be so interesting, until I came across your channel! Understanding why businesses make certain decisions - even those that are explicitly at the cost of consumer freedom - helps me tie this confusing mess together. I’d love to see a similar video relating to Sony or Microsoft, as they deal with the much larger technology assets alongside their flagship consoles and characters. Diving into that will probably be even more time-consuming, so it’s ultimately up to you. Either way, I can’t wait to see what else you’ll cover :)

[@kris.p.bacon1361]

Also Nintendo is a Japanese company meaning they follow a foreign legal system and their copyright laws.

[@XperimentorEES]

@@kris.p.bacon1361 Not to mention being downright hostile about it because their work culture is even greedier in the game industry.

[@kris.p.bacon1361]

@@XperimentorEES that is true Pokémon fan games and rom hacks did better then some of modern titles,and instead of being proud of how creative, and supportive their fans are they give them a cease and desist.

[@ZeroKitsune]

@@kris.p.bacon1361 Uh...Sega is Japanese too.

[@nikkihedged]

@@kris.p.bacon1361 SEGA is also Japanese

[@Swaggless]

As a lifelong Sonic Fan, this video was eye-opening and mind-blowing! Everything makes so much sense now. I just hope the fan base is able to make enough stink to protect fan works. I still believe that maintaining a consistent legal diligence which allows fan-works to prosper while cancelling problematic projects infringing on SEGA's copyright in a way that erodes their ownership over it will remain key in Sonic's long-term success. I do believe that, despite their MASSIVE success, Nintendo's overly paranoid approach hurts them more than it helps.

[@lalehiandeity1649]

Just stop making fan works altogether. At least online.

[@connormclernon26]

Counterpoint. Sonichu and it’s creator.

[@Swaggless]

​​@@lalehiandeity1649 No, Nintendo Ninja! You can't fool me.

[@Swaggless]

​​@@connormclernon26 Counterpoint counterpoint: Sonichu & it's creator

[@lalehiandeity1649]

@@Swaggless I don’t work for Nintendo. It’s the simplest solution.

[@YourBoyDonald]

Okay, here's my explanation: The difference in how Sega and Nintendo approach the protection of their intellectual properties, specifically regarding Sonic the Hedgehog and Mario, can be attributed to their respective business strategies and philosophies. Nintendo is known for being highly protective of its intellectual properties, such as Mario. They prefer to have strict control over how their characters and games are used and want to ensure that the quality and integrity of their brand are maintained. By limiting the availability of Mario games to their own platforms, like the Nintendo Switch, they can guarantee a consistent experience and protect their brand reputation. On the other hand, Sega has taken a somewhat different approach. They have been more open to licensing their characters, like Sonic the Hedgehog, to other platforms and developers. This approach allows them to expand the reach of their brand and increase the visibility of Sonic in different gaming communities. By allowing Sonic games on platforms like Roblox, Sega can tap into a wider audience and potentially gain new fans. There are a few reasons why Sega has chosen this strategy. First, Sega has faced challenges in the past and has been less successful commercially compared to Nintendo. By being more flexible with their intellectual property, they can generate additional revenue through licensing deals and collaborations. Second, Sega may believe that by allowing Sonic games on different platforms, they can foster a stronger fan community and keep the brand relevant in a rapidly evolving gaming landscape. It's important to note that both approaches have their advantages and disadvantages. Nintendo's protective stance helps maintain a certain level of quality and exclusivity for their games, but it can also limit their availability. Sega's more open approach allows for greater exposure and potential revenue streams, but it may come at the cost of diluting the brand or risking inconsistent quality. In summary, the differences in how Sega and Nintendo protect their intellectual properties, specifically Sonic the Hedgehog and Mario, stem from their unique business strategies and philosophies. Nintendo prefers strict control over their characters, while Sega is more open to licensing and collaborations to expand their reach and generate additional revenue.

[@Johnmrobinson-vb5vd]

The ken penders lawsuit is the perfect example of segas lax treatment of copyright infringement being a double edge sword

[@M64bros]

While Sega is totally fine with people making Sonic whatever the heck they want, Sometimes Sega should protect the Sonic brand from the wrong fans/people that treat the Sonic brand wrongly. After all, Sonic is a brand and must be protected at all costs.

[@tord5363]

this reminds me of that one fake trans dude who did it with his old ahh mom and made a sonic oc

[@FunnyParadox]

@@tord5363 Omfg not chris-chan 😭 that guy is the perfect representation of what happen if you harrass a weirdo for decades non-stop, sad but disgusting--

[@Dragzilla66]

*Cough* Sonic Omens.

[@NiekNooijens]

Actually... Capcom does that. They state on their website that they allow for fan art and fan games, as long as it doesn't damage the brand and they reserve the right to take it down.

[@NatetheNintendofan]

Yooo m64bros

[@fridaykitty]

I wonder how many lawyers are Ace Attorney fans? I can't help but picture a big fancy attorney's office kinda like Marvin Grossberg's, with a big wooden desk, warm lights, packed bookshelves... then there's a little silver DS juxtaposed atop the desk with AA3 ready in the cartridge slot haha

[@CommanderWiggins]

I'm just imagining lawyers using Ace Attorney as a source for how to deal with cases. "Hmm I haven't handled a situation like this before, allow me to consult the texts." *Walks past bookshelf of law books over to a case with every Ace Attorney game in it* "Ah yes, I believe a similar case was covered in Ace Attorney - Justice For All in Turnabout Big Top."

[@InkyBlitz]

I mean, considering that they are largely awful people, probably not many. Protagonists of Ace Attorney are generally good people that do the right thing. Lawyers do what is good for their wallet. Hell AT is antithetical to how the Japanese legal system works to begin with.

[@bulbasaur1534]

I wish there was more awareness of what pretty much goes on behind the scenes with sega and sonic team. I feel bad for talking crap on sonic team, when really it's always higher management that pokes holes through their stuff. At the end of the day, there are people that actually love making/creating games that try to be its best selves, sonic team having to put up with corporate meddling to this day is just one example, and one I can forgive and see in a different light.

[@VorpalBlad3]

You've earned yourself a subscriber. In these most recent and dire years of youtube practices, if this video is any indication, your content stands out as one that most concerned with message and quality. That has becoming increasingly rare, and this video feels like it could have come out 10 years ago before "grow at all costs" had spilled so heavily into the very content the platform hosts. Well done.

[@quazarKiragon]

i just love how as soon as you mention ken penders the sonic 3 boss theme starts blasting, a very fitting social que especially since how much of a villian he is

[@Pikminenjoyerbunchofnumbers]

The true final boss of crappy sonic media

[@MidnightLobster7]

I have to say that I doubt it is coincidence that UFO Catchers, Mushiking and Sammy Pachislot/Pachinko machines all have appeared in the Yakuza Series with some of them being recurring appearances. I do not suggest that Yakuza devs did this in bad faith, their goal is to accurately capture Japan's atmosphere especially in entertainment, but I wouldn't be surprised if RGG Studios had gotten requests from Sammy to add these things in and complied either out of obligation or due to it seeming to be a mutual interest/benefit.

[@SpaghettyLuvsU]

Product placement is probably a factor, but it's also a way to add verisimilitude to the game world for free. They can include hardware that people would recognize from real life without needing to negotiate licenses and pay fees to use someone else's IP.

[@TheSofox]

This is nowhere a new thing. In Shenmue, a Dreamcast era game set in the 1980s, there's SEGA arcade games in an arcade including fully playable Hang On and Space Harrier. Ryo even has a Sega Saturn that's totally anachronistic for the period the game is set in. Go back even further, Alex Kidd: High-Tech World released (and set) in 1987. The entire goal and objective of that game is to go to an arcade and play some SEGA games.

[@byronvonedmund]

As a law student (who is an Ace Attorney fan myself) , I am absolutely grateful for this and your previous video explaining the company behavior with their intellectual properties. Truly looking forward to new videos of the same style ^^

[@АлександрТерехов-ж3й]

О привет!

[@byronvonedmund]

@@АлександрТерехов-ж3й ну и ну, не думал тебя здесь увидеть. Приветствую

[@Solesteam]

2:23 Carnival Night, Casino Night, Collision Chaos, Spring Yard and other Pinball or Slot Machine filled Sonic Zones make that a well established memory once you hear of that fact...

[@libi4779]

Casinopolis

[@MiniCrew11]

Casino Park Casino Street Pinball Carnival

[@carolkoski4875]

Your explanation and showing how a company chooses to gain money from fandom and imagery instead of focusing on making the art itself is weirdly (maybe the word should be 'obscurely') something I retroactively end up seeing a lot in many big and mainstream art production. I have to assume this type of business will only grow as fandom grows, specially for those art productions made by companies interested in taking the easiest way out and making fast cash.

[@SkatingJellyfish]

As an atlus fan, this makes so much sense now. I’ve always kind of wondered what happened with smt as a series after the release of smt iv (2013) where we started getting less and less games than before and the persona 4 spin off apocalypse took a really strong hold. The shift really happened around the same time and i had no idea that was when sega bought them. Its kinda sad tbh since they’ve produced some of my fave games of all time :( oh well, lets hope we can still get more new smt games tho i see it very hardly after the soul hackers 2 fiasco

[@mooocattle5344]

Atlus at that time is almost bankrupt because their money taken by their head corporation named index corporation. It's sega who revived them. If u don't believe me just google it.

[@definitelynotapervert5602]

Didn't SMT V come out last year or something tho?

[@symbiote1982pk]

Games take a lot longer to make now though, the DS was the last console to get a glut of SMT games that were much cheaper to produce, after that it's been the steady trickle that you'd expect from any competently made modern series, so I think you're just seeing what you want to see.

[@matteste]

There also seems to be the fact that Kaneko, the last senior director and creator at Atlus stepped down, resulting in this loss of the series spirit and the drop in quality.

[@swinelias]

Well, considering we got SMT V: Vengeance and Metaphor: ReFantazio (which btw was a game that was announced a very long time ago), alongside P3R this year, I'm positive we're still going to get more SMT games in the future.

[@wariodude128]

I never heard of the term clown fiesta before, especially in regards to court filings. I love it. Something about Sega with Sonic is they once let someone who created ports of their games to not long after make an original one. End result? Sonic Mania, often seen as better than Sonic Forces which came out the same year. Not having a system to sell their products on could be another factor as to why Sega is so whatever with Sonic. Being a third party means wanting to port games onto everything to make as much money as possible from selling them to everyone. Nintendo meanwhile is first party and does have a system to sell. Still would like to know why Chris Pratt was a safer bet than the voice of Mario though.

[@sargentgullible2794]

In Nintendo's case with Chris Pratt, I imagine having a "safe choice" would be a more approaciable lead to appeal as many people as you can across the globe. When you try and do the usual Mario voice, though, it could come across as an offensive stereotypical Italian to some people (more so if they somehow weren't familiar with Mario at all) when it's trying not to be, and on top of that, if the Minions movie taught us anything, having the protagonist have short grumbles can get especially annoying during long runtimes, especially if they were higher pitch.

[@Tuss36]

Given the examples provided, my impression for the Chris Pratt thing is that it'd be easier to disassociate with him should issues arise.

[@funlover163]

​@Tuss which I find hilarious because he's been involved in controversy for the last couple years. He's strongly associated with Heartsong church, which is a megachurch

[@bluestar5812]

Sonic was strongly tied to Sega's home console marketing. After they became a third party studio, Sonic was left without a purpose. The changes began with the very next game Sonic Heroes, with Knuckles no longer being tied to protecting the Master Emerald.

[@MontySlython]

​@@funlover163But no one with a brain or conscience particularly care about that "controversy", it was known he was Christian already and it ultimately just made his image slightly less wholesome for some people but to 99% of the public in the real world he's still well regarded.

[@SockyNoob]

I've been waiting for this for ages. As a Sega fan, I'm deeply familiar with their history. But I'm no legal expert or industry veteran, so it's very interesting to see why Sega did what it did compared to Nintendo in a legal sense. Sega and Nintendo both were highly protective of their hardware and licensing agreements. This video more or less confirmed by suspicions, though now I walk away knowing why and how.

[@axelprino]

That was very informative, I knew SEGA's way of handling their IP's was quite different depending on what IP we're talking about but never knew or considered that Sonic was mostly valued as a literal PR front for upper management, specially because the franchise was always profitable in its own right. I always assumed that the whole messy situation was caused by the company just allowing their many pieces to handle IP and their legal protection on their own, a simple distribution of responsibilities as far as things like DMCA takedowns were concerned. That said I don't think that putting that genie back in the bottle is going to be particularly easy or pain-free, if they really intent on strengthening their grip on how Sonic is used by the community that might bring them a sh*tstorm of colossal proportions knowing how "intense" the fanbase can be. Nobody ever rallied behind Ken Penders' cause because he's generally disliked by most, but who knows what might happen if the next guy to take them to court with a decent argument happens to be someone with actual support.

[@budgetcoinhunter]

You can argue that they kinda did that when they ascended prominent fan-devs Stealth and Taxman for the classic remakes in Retro Engine. Prior to Sega hiring them, it was mostly a proof-of-concept 2D game engine, optimized for Sonic naturally, that you could do other games with. Hell, I even still have the old software sitting on an SD card for my Wii, which offered a template for Sonic games, including Green Hill, a test level, and even a totally original stage called Bronze Lake, if I remember correctly. Had they not been hired by Sega, Sonic Mania would have been a fan game with 100% new stages, rather than a mix of old and new like we got.

[@ArtofZenDigital]

If knowledge is power, then this video is Hercules. The way that you explained the difficult aspects of IP law is truly impeccable. As someone who’s worked as a Graphic Designer and Art Director for many different companies and brands, NDA’s are signed that have resulted in waiting for up to 3 years in extreme cases to simply show work that’s been done for my portfolio. It makes perfect sense in this regard for most of the superb information in this video to not be made public by Sega employees. Especially if they hope to continue to work in the gaming industry. It’s important for this information to be out there though, largely because there’s been a feeling among Sega fans that they simply don’t care, but the reality is the opposite. It’s a shame to see what Sega has gone through, but they’ll always have fans that pass down their legacy, even the parts that aren’t so shinny, as a cautionary tale. Thank you for sharing this video, I hope that it’s seen by as many people as possible. This is a definite sub, best wishes!

[@Ohimeshinso]

And this is why you don't go public. Having to satify investors is... too much of a hassle when you're an artist. And make no mistake, game developers are indeed artists.

[@Cyber_Akuma]

10:20 From what I understand, the TMSS was in the developer manuals from the start and all games were supposed to do it, it's just that the launch Genesis/Megadrive units didn't check for this and so a small handful of games didn't include it. But it was no secret copy-protection like the NES's NES10 chip was, the developer manuals flat out told you what to do to get past it (You just had to send a string of "SEGASEGASEGA" text to a certain memory address), there was no reverse-engineering, developers were told what to do. The idea was that since the game would be sending the name "SEGA" which is trademarked, and making the Genesis display that screen, that SEGA can sue anyone who does it without authorization for trademark infringement. As you mentioned however, the tactic of suing over it as their "security" measure failed.

[@darkwarrior007]

About halfway through watching this video; and I've loved this series and this video thus far, but there's a bit of a comment/implication about Sammy that I feel is a bit unfair; that being the implication that they were responsible for the poor corporate management that led to the "dark age" of Sonic. Truth is, that mismanagement has been part of SEGA and affected Sonic Team and Sega Technical Institute(at the very least) since basically the very beginning. Yuji Naka quit after the first game because he had been underpaid. Sonic 2 and 3 were developed under unreasonably tight deadlines. Sonic X-Treme didn't even get made because the pressure from corporate caused its project leaders to get hospitalized from overwork. Sonic Adventure 2 was staffed by like ten people, and so on and so forth. SEGA's always had a problem with hamstringing and rushing the development processes, and that doesn't seem to have changed for better or worse when Sammy took over.

[@nikkihedged]

This is so true. If SEGA weren’t such a mess, many of their problems might have been avoided.

[@joshz2491]

His point is that the merger made A mockery of Sonic as a means of quality IP, sonic after the merger was awful and gimmicky, whereas games before the merger were flawed and maybe even rushed but were fun to play, the dark ages on the other hand are full of wasted potential.

[@MagnaLynx21]

This is the Samy side of the Sega story that I feel has rarely been covered on KZbin pretty much ever, and I've been here since 07, it's great to finally see more about the missing link. Great content!

[@thatbol76]

I can tell that you really put a lot of love and effort into your videos. I can’t wait to see where you go from here. Best of luck.

[@iamthemistake7084]

Expanding upon the Nintendo Copyright video into one about the Sega's Business practices, was really a check-mate of a move for this guys channel. Can't wait for a Konami video.

[@AmorousMelody]

So, I found this video suggested to me by the algorithm, and I was just curious, since I've always been wondering how come Sonic is an oddball when it comes to IP protection. Hearing all the stuff about Sammy almost made my blood boil. Like, jesus, it explains a lot of those years. Minded I am 23 and was a Sonic fan since... '07 or '08, and didn't get on the internet til later. But still, it made a lot of stuff made sense, from what I learned as I grew up. And then Penders, omg... Penders... Ugh. The thing is, I don't know how to feel about all of this. Am I happy that Sonic has a lot of freedom allowing for such creativity in the fanbase, to the point that even people that worked on fangames and silly fanart worked on official stuff like games and comics? Or am I upset that the only reason it's that way is just because Sonic was a PR scapegoat? I do know I am upset that it's those same higher ups that saw Sonic as PR scapegoat rather than potential for income, that made a lot of games with potential suffer. And also that it makes me sort of mad that because they saw Frontiers' success, even with bugs and unfinished stuff and untapped potential within limited time, that NOW they give more budget to titles and the team... NOW they find some importance to Sonic... but it's only to get more money. All I know is that higher ups and investors suck. But I cannot bring myself to hate Sonic or Sega at all. I love the games. I just wish it was not this way, you know. Perhaps it would have been better if I didn't know all of these details. Who knows? Either way, you did an amazing work with the video!

[@Chiller326]

This is the journalism the gaming industry needs, but the one it deserves. edit: i'm leaving the typo

[@Chadventure_Animated]

Love your channel dude. You found your niche and it's popping for you. Can't wait to see where you go from here with this direction

[@Part_Time_Fox]

This is quite the amazing video and you are criminally underrated! It's always nice to learn something new about Sonic and Sega by association. The whole pachinko Sega Sammy deal was something I had ZERO knowledge about. Thank you!

[@greglongmore6503]

I havent finshed but I'm so glad you reminded me of and explained (as you said, from your view) the SegaSammy thing. I'm from that era and I do remember saying to myself "Is Sega in trouble or what is happening" and this helps break down the behind the scenes. Also the independent contractor thing at 34:30 is what put Marvel in such trouble and left Stan Lee and co relatively and actually broke, no?

[@navilistener]

This video is the perfect follow-up for the Nintendo video! As someone who grew up with SEGA and Nintendo games and still plays them to this day, it is really interesting to understand the reasons why these two companies have/had such different approaches in regard to their intellectual property. I never believed that SEGA's decision to allow Sonic fangames came from goodwill, but I thought that the objective behind said decision was to boost sales by creating a good relation between the fans and SEGA while also possibily gathering ideas, fan feedback and even developers to create new games tuned to the fans' interests. But I see that the true reasons are much deeper and technical that I could ever imagine, and it makes sense that they were made to maximize profit. I'm glad to finally understand the reasoning now. Thank you so much for taking the work to create such great quality videos. I love to learn about this stuff and your videos are extremely informative, enjoyable and valuable. I'll be sure to continue watching your videos about the law of intellectual property and I'm sure a lot of people also will!

[@TheDokTor]

One of the best, most in depth videos about Sega and the gaming industry in general on KZbin. You're content is absolutly amazing!

[@bruhman6940]

The amount of time and effort put into this really shows, good job. I really like how your videos are entertaining while being informative, and also really well laid out.

[@octoturt]

i think this video is an excellent case study that really helps strengthen everything you discussed about nintendo in its video. the ken penders bit in particular really helped to illustrate just how messy a house of cards IP law can really be

[@KryyssTV]

A very thorough analysis and frankly I'd struggle to find any flaw in your conclusions without some heavy further research. What wasn't covered here but is definitely worth mentioning is that in 2021 Sammy decoupled SEGAs financial assets from Sammy itself to recover from the massive debts Sammy incuured during the pandemic when all their hotels and casinos had to close. As it now stands, there isn't a SEGA arcade left in the world as Sammy sold off everything in their name and shut down SEGAs arcade development studios. The company that pioneered the arcade industry is now gone. Since that happened, SEGA has been operating without the vast resources of Sammy and I wouldn't be surprised if the sudden rise in Sonic's public image and quality of games is because Sammy is looking to add value to the SEGA brandname and IPs in preparation for selling it all to recoup more of their losses - as their debts were substantial. As stated, the brandname alone is worth far more than the revenue the games produced. Hopefully we'll see SEGA find a new home under a publisher who appreciates the Sonic brand and is genuinely interested in creating great games rathr than bleeding a franchise dry to bolster a gambling business' public image.

[@moon-channel]

This is a great insight, and something I genuinely missed while conducting my research. It's extremely substantial information, too. I'd love to do more research in this direction someday, perhaps for a follow-up video.

[@KryyssTV]

@@moon-channel You can find out more by looking at news surrounding the liquidation of SEGA Entertainment and the sale of assets to a corporation called Genda who reopened the former SEGA arcades under their Gigo franchise brandname. At present SEGA has been working closely with Microsoft to publish and operate Phantasy Star Online 2 in Europe and the US which may be why there's been persistent rumors since 2021 that part of Microsoft's mass acquisition of IPs and studios may eventually include SEGA itself as a corporate relationship already exists.

[@nikkihedged]

Sammy isn’t selling SEGA. They need SEGA’s video game business to improve to make up for the decline in pachinko/pachislots revenue. That’s why Sammy brought SEGA in the first place, to expand into the video game industry.

[@KryyssTV]

@@nikkihedged If you check the investor reports for the last 5 years you'd se that simply isn't true. The SEGA Corporation's running cost was greater than its profits and it was only kept financially solvent by the profits made from Sammy's other ventures like their arcades and Pachinko Parlours which they had shared profits with Sammy via SEGA Group. They have been nothing but a financial blackhole for Sammy. As was also stated in this video, revenue from video games sales have only been a fraction of what Sammy makes from the rest of their business. SEGA has never come close to even contributing 50% to SEGA Sammys annual revenue. Also, when SEGA Group Corporation and Sammy Corporation was dissolved it resulted in two distinct companies, each with distinct assets and administrators. SEGA Group Corporation was split into two parts, arcade and home entertainment, with all arcade assets being wholely owned by SEGA Sammy Holdings while the remaining home entertainment assets were merged into SEGA Corporation itself. Meaning that as of 2021, SEGA Corporation is just a subsidiary of SEGA Sammy Holdings and not getting any financial support from SEGA Group Corporation which operated the venues which had the arcade mechines and pachinko parlours.

[@demetriusnp49]

@@KryyssTV So what do you think of SegaSammy now with all this happening with Rovio and Sega America very much having Sonic on their backs now with SegaSammy Japan still influencing its direction? If the entertainment is less than 50% as you said, than I can only assume they want to make their assets more appealing to investors to invoke a bigger potential buyout. But, recent reports also say that the government is protecting them from being bought, someone saying that Sega was too valuable to sell. Yet is it too valuable due to IP image or its potential mobile scrutiny?

[@M64bros]

You did good moon! I can also share your videos with my community posts so more people can be interested in your content! Other than that, good job on the video!

[@moon-channel]

You're always very kind, M64. Thank you for your support!

[@M64bros]

@@moon-channel My pleasure!

[@seto_kaiba_]

As a Sonic fan, watching this feels like learning that your wife has been cheating on you and the baby is not yours. lol.

[@NotAGoodUsername360]

I would say it's more like growing up and realizing the family small business has been a front the whole time. Which really shouldn't suprise anyone who has been reading between the lines in the Yakuza series.

[@yeagmatic]

wait till you find out about their ties to the yakuza lol Edit: judging by the comment above me theyve hinted at it in the Ryu ga gotoku series but i havent played any of those

[@Biddybud]

Well said!

[@fabianstonepsn6866]

When u find a comment that makes you watch the video lmao

[@NeedyBoBeedy]

@@fabianstonepsn6866 didn’t you click on the video to watch it in the first place? 💀💀💀💀

[@matthewlasalvia7026]

Remember, kids. Corporations are not your friend. No matter how consumer friendly they appear to be.

[@Eminster]

Shouldn't that be obvious

[@goGothitaLOL]

@@EminsterHere’s the thing and difference Media companies (Hollywood and Gaming) make products you can be emotionally attached to, whiling mass manufacturers (like car/truck, phone, and fast-food industries) are nothing more than products. Do you see people (let alone their own consumers) call out or defend the likes of Ford, Apple, McDonalds, etc. as much as they call out the likes of Nintendo, Square-Enix, Capcom, Disney, Warner Bros, Paramount/Viacom, etc? Of course not.

[@mememan9890]

​@goGothitaLOL depending on where you look, yeah kinda. Especially Apple.

[@redstone0234]

Even Valve! Valve IS not your freinds they introduced battle passes and loot boxes in the western game market Waited a long Time to put refunds on Steam (Until thé australien goverment sued them)

[@JakeThehedgehog-m1x]

True we already know

[@KaiserHitoshi]

I practically broke into a cold sweat at the sudden pivot to Penders...

[@warbossgegguz679]

The real answer: Any hardcore Sega fan can tell you they are just as over-protective, just not for Sonic. SORR, Golden Axe, and a ton of other SEGA fan-games have been C&D'd in the past but nobody talks about it because "YO THEY HIRED FANS TO MAKE MANIA!!" and other stuff.

[@AkameGaKillfan777]

Modder: *sneeze* Fanboys: "SEGA, HIRE THIS MAN!!!"

[@Lutyrannus]

Did you even watch the video..? He literally brings up THIS EXACT POINT in the video lol.

[@Blanktester685]

and there are tons of fangames that they haven't whats your point?

[@warbossgegguz679]

@@Blanktester685 Name one that isn't Sonic related that hasn't gotten C&Dd.

[@nessamillikan6247]

Man, there are so many topics to talk about in this video that I have to put it in another comment! Missed opportunity to break this up into a 10-part docuseries on Sega, aaaamiriiiite?! I have to say that your calm and informative delivery of Sega's early history in the first half felt markedly like I was watching The Gaming Historian (a compliment, I intend!), but your format to analyze and challenge both your topic and your audience in the business-psych aspect sets you apart distinctly. You have a very cool teacher vibe and do great to show you're not above us (and how easy it could be to do). Needless to say, you're a stark contrast from the law-based channels on this platform, and it's awesome you're planning on projecting your own growth here! "Well, Stanley," cried the Narrator, "I'll be here for it!" And I gotta appreciate that TSP reference! The original Source mod is one of my favorite gaming experiences. I would love to hear your opinion on TSP and other "walking simulators" like Dear Esther and Yume Nikki, if they appeal to you as much as they do to me.

[@donslyuckus]

Surprised your channel doesn't have hundreds of thousands of subscribers. At least I was here before you inevitably get there. Your content quality is excellent, especially with your spin of the legal aspects being explained in a thoroughly-knowledgable manner.

[@Nogardtist]

Get used to these KZbin is in hidden gems era where talented and skilled creators dont get recognition

[@SeekerGoldstone]

Check again ;)

[@shadow759]

This was a very educational video! I really love how this came together and very well explained.

[@chJohnJobs]

hello shadow759, havent seen your comments in awhile. hope you have a great time

[@Obi-Wan_Kenobi]

This video broke me heart to degree. I love Sonic. I love his character and I love his games. So it breaks my heart to know that he and Sega are under direct management of a gambling corporation. All the money I've poured into him over the years, all the good will I've had toward this incredible hedgehog, it's all gone to directly benefit Sammy. And this was their plan the entire time. Honestly, it makes me sick because I hate gambling and all the compounding vices that come with it. But at the same time, I love Sonic and my love has been used to not only prop up the reputation of Sammy but also financially benefit them. The ignorance of never knowing I was helping a gambling company profit was bliss. But at the same time, the truth had to be be known so we can act accordingly. Still, how I wish it weren't so. I'm going to need some time to process it. My broken heart needs time to repair and my head needs time to think.

[@nitrostormskystriker478]

Is Sonic your wife?

[@manleyfgc7981]

You're kinda dumb if "gambling company = bad" makes them worse than any other large company. Gambling isn't a bad thing. You gamble every time you hop in a fucking car to get to work. Understand what speculative risk is before yapping like this

[@RiahGreen]

I would be really interested in seeing you quickly go over investor reports for companies like nintendo and sega, as well as capcom when they're released since they seem like pretty good indicators of what direction a company wants to take.

[@reviveempires]

Can I just thank you for actually making videos from a point of view that ISN'T just screw the company and understands the ins and outs of IP management. The amount of people who want IP laws, not simply improved to be more accommodating to fair use, but literally destroyed so there is no more IP is utterly staggering. Those people in particular target heavy handers like Nintendo because they got burnt a few times or are just the "corporation mean" types. Your videos have been great! Edit: [ What I am basically saying is that the videos aren't necessarily anti Sega or anti Nintendo. I'm all for IP management reform it's just I think it's silly how so many people just want IP to die ]

[@BorealColdstone]

Profile picture and username checks out

[@davidvaldez1093]

@@BorealColdstone and subscriptions

[@johnboomthegamer7533]

I think more of the sonic Fanbase needs to hear this not just about the fact that Sega Sammy’s been using sonic as their escape goat, but also the fact that we are the only Fanbase that has a say about Sega from completely shutting down fan projects

[@XperimentorEES]

I'd say fan of other companies should see it, to be reminded no corporation is entirely good nor remotely perfect, so many wheels and leashes behind the scenes. Think about it; nintendo has a larger fanbase yet also has one of the most controlling holds on independent development, microsoft continues to be backed by their dominance of the pc market letting them take risky and stupid choices without much consequence, sony the company known for an abundance of indie games on consoles have become rather elitist while sharing what used to be their exclusives, valve the company known for the ease of pc indie games has started stepping on the toes of other giants in an acquisitions march, ect.

[@godaberi]

What a great video. I had been familiarized with SegaSammy only by name but I wasn't aware of the impact it had on the whole franchise; this new context puts a lot of things into perspective. I also had a general idea of the Ken Penders case but your explanation helped me understand it further. l also want to commend your editing style and script, I think it's what people should strive for, for these types of essay videos, and something I'd strive for if I made my own. Nowadays the majority tends to lend to the over-editing and fast-paced side and when I find channels such as yours I can't help but praise it. Keep it up! o7

[@janey4319]

I have other reasons why I prefer Sega over Nintendo (music distribution, game pricing strategies, etc) but I think it is foolish to be a blind "fanboy" for any company. There is no such thing as a perfect company.

[@moon-channel]

I think this is a great point, Amanda. If there is anything I hope people take away from this video, and the Nintendo video, it is that corporations are not our friends, nor our companions. Corporations exist for profit, and while that's not a bad thing, we should not blinded by our love of their franchises into believing that said corporations have our best interests at heart.

[@AkameGaKillfan777]

So far they have yet to make a $70 game I think

[@MegaDarkness5000]

​@@AkameGaKillfan777Sega has already announced they will be looking at the $70 tag

[@AkameGaKillfan777]

@@MegaDarkness5000 Did they say they'll reconsider if people are against it at least, like they did with NFTs?

[@MegaDarkness5000]

@@AkameGaKillfan777 No just that they are planning to do $70

[@animationloverslacker2405]

When I heard about this discourse back in 2016, I thought it was because "Well, SEGA is a dying company that hasn't made good games since the 90s, so of course they got to rely on fan games." But as the years went on, I never realized how big and successful of a company SEGA is. Us Americans, especially us Nintendo fans, think that SEGA is only really Sonic and that them stopping their console department killed them, but SEGA has so many successful franchises and companies under them.

[@joshthefunkdoc]

i mean, who would ever guess Sega having any connection with Football Manager if you didn't already know about that? That's a big series in its own right, though more of a European thing obviously. Also Yakuza generates more revenue than Sonic now IIRC, just that again Americans wouldn't think that since it doesn't have movies or tons of merchandise you see around here.

[@animationloverslacker2405]

​@joshthefunkdoc Yeah good point. Also, SEGA seems to be viewed more as an arcade and toy company in Japan, with franchises like Yasuka being big there, while us Americans see them as a video game developer and former console manufacturer, with Sonic being the most known to most Americans. While they are american fans of Super Monkey Ball, Crazy Taxi, Space Channel One, and Jet Set Radio, they have more so of a cult following. t took memes for Yasuka to be more known out here and even then, the franchise is still small.

[@baraksha1]

You have no idea how long I waited for someone to make this video, this is a topic I usualy explore when ever I discuss why Sonic is the way it is but I dont have any actual legal expirience and neither anyone I know so its hard to back this stuff up. People just kinda assume things from what others tell them and just dumb down the conversation to "SEGA/Sonic Team are incompetent" or "they just want money" which is annoying because not only is it shallow, this is just not stuff we can confirm for ourselfs. Which is why I usualy have to give the unsatisfying answer of "we don't know if they are incompetent or greedy. We can make a narrative using the information we have but its all assumption."

[@knellycornnan5132]

Its interesting. I always thought the casino levels were oddly specific in their themes. However I would usually write it off as just one of Eggman's business. Now it makes more sense.

[@nikkihedged]

There have casino levels in Sonic since Sonic 2 in 1992

[@jaren12072]

This was an amazing video. Your way of explaining the law makes it easy to understand.

[@Jamazed]

The narration and editing for these videos were great. Hope you guys keep growing the channel and enjoying the reception.

[@NeonSonOfXenon]

Good stuff dude. This is the perfect vibe for a lazy, stoned Sunday. I love the research you've put into this. Wholly informative yet relaxing. It shows, the love you put into these and all I gotta say is keep doing what you do, sir! It is appreciated!

[@Xcog]

I greatly appreciate people who can explain legalese to laypeople, because it's hard for me; it is the way it is for a good reason, optimizing against ambiguity to facilitate enforceability, as far as I understand, but that also can make it impenetrable. If nothing else, I've found your perspective enlightening in the videos I've watched so far, so even if things shift away from law-ish stuff, I think I'll still greatly enjoy future videos. I think the key might be contextualization; even things that seem objectively bad become so much less evil and more understandable, which I think is a really healthy way to grapple with it all (and helps put "actually" evil things in perspective).

[@shyguy85]

bro really said laypeople

[@TricksterZorua]

The only point of criticism I got on this video, is the portrayal of the Accolade lawsuit as Nintendo had an earlier lawsuit regarding their own lock-out chip vs Atari/Tengen. Besides that, this was simply a good reminder to how even Sammy isn't backing off from hunting down copyright infringements, how non-profit they may are, from those who want to preserve games (such as the SMT MMO) or bring them into a new like (Streets of Rage remake). Nice to meet you, "Moonie". Great to see your channel once again after the Nintendo copyright one. Hopefully we'll see more great content on your Moon Channel. I can't wait! 👋

[@Toonrick12]

I think the difference is that Nintendo's lockout chip was a hardware-based lockout, thus being able to be covered under patent infringement. Sega on the other hand with its TMSS was a software based lockout with its only protection being copyright and trademark of the Sega name. You can copyright software, but you can't get a patent for it.

[@TricksterZorua]

@@Toonrick12 That is true, but I believe the point of showing SEGA's suit was to indicate they don't want anyone publish games on their platform without their blessing. Which was exactly the same with Nintendo hence they had the hardware-based lockout chip 10NES. Although done as well for piracy control, they harnassed it to keep third party developers out of developing and publishing hardware for it without their monopolisitc policies (buying the cartridges on their terms etc.) due to the American Video Game Crash of '83. EA had a similar case with SEGA later than with Acclaim, where eventually EA got permission to make their own Mega Drive/Genesis cartridges.

[@thatfriendwhosesanityyouquesti]

This was such an interesting video and I wholeheartedly enjoyed it. It’s so well made too! Felt like I was watching a team-produced documentary (the small Sammy bit made me giggle). The dry humor and delivery was witty and kept me invested even through all the legal jargon. It’s pretty easy to blame faceless companies for the blunders of their products, but it was so cool to learn the actual details of how and why SEGA made the decisions they have. Sonic being a scapegoat never once crossed my mind and I was surprised by some of the information. Truly fascinating. Once again, awesome video! High quality all the way through and I wish you luck on the growth of your channel! ^-^

[@jadewukong]

no matter the quality of a sonic game, the soundtrack always SLAPS

[@AkameGaKillfan777]

Except Boom

[@JakeThehedgehog-m1x]

​@@AkameGaKillfan777 true..

[@NewtrendsMe]

You see this is the kind of investigative reporting I can come to trust. Well balanced with through research. Learned much of the inner workings of a company I've known for so long, but not really at all. Just subscribed. 👍

[@EyeDonutz]

this video was a lot more interesting than i was anticipating! id love to see more videos about this kinda legal trivia, pretty unexpected stories

[@princessjellyfish98]

Another great video! I love hearing your legal and business expertise on these topics because it's so fascinating and something you don't get from other channels. Your scripts are also really entertaining! Can't wait to see what's next and I'm looking forward to your eventual video about dress up games/girls' flash games!

[@moon-channel]

The next video will be on dress-up/girls' games! The script is just about finished. I'd liked to have finished the video by International Women's Day, March 8th, but it may need another week.

[@UltimateKyuubiFox]

This was fascinating. You now have my trust in the future to make watching a priority.

[@bonnymel4506]

Wow, the dark age was even darker than I thought, it's amazing how they managed to make Sonic Unleashed the best Sonic game even around those horrible conditions

[@orangeslash1667]

Unleashed was the last Sonic game by Sonic Team USA before moving back to Japan. The game was directed by Yoshihisa Hashimoto who was a programmer of Sonic Advance 1 and 2, he even he designed the Hedgehog Engine. He said that he wanted to achieve a graphical fidelity on par with Pixar films. It would originally going to be Sonic Adventure 3 before Yoshihisa come up with the idea of the were hog. Sadly Yoshihisa left Sega in 2009 for Square Enix.

[@matthewlasalvia7026]

For all those wondering why Nintendo never bought Sega, Sammy is the answer.

[@symbiote1982pk]

Why would Nintendo "buy" SEGA? they don't acquire studios like EA or Activision do, they may partner with them like they do with Retro Studios, sometimes exclusively, but as Alpha Dream's demise shows, they aren't linked with Nintendo in any other way. So no, Sammy isn't the reason that Nintendo did or did not do anything.

[@LasagaMan]

@@symbiote1982pk If Nintendo did buy Sega when they did have the chance, (2001-2003), then they could've had a better profit becuase this was before Sonic 06, Boom (and to an extent Shadow the Hedgehog) didn't bomb the series credibility and the subsequent sales potental each game had..

[@brandonalex7233]

@@symbiote1982pkRetro Studios became an Nintendo Subsidiary

[@Gbrille]

​​​​@@LasagaManYou have to consider that in those years Nintendo themselves were hurting from a decline of consoles sales since the Super Nintendo with the N64 and Gamecube being their worst yet. They hadnt had the massive success of the Wii, DS and nowaday the switch to rest upon and help take the massive money hit such an aquisition would give. Only the Gameboy family mostly during the 90s. Nintendo is also famous for playing the long game with investments and aquisitions as well. I recommend a channel called Nintendo Forecast that delve into this.

[@AnimatedPlays288]

the thing that sucks is that most of us sonic fans dont see those things that way. in fact they see it like sega is actually supporting everyone and they love us fr. but its just business. its like saying that you think your friend is actually gaving you back the money he owes you but he is actually giving you fake money and your not realizing it. thats honestly crazy but also not surprising because this is just a common thing at this point but damn im glad i watched this video.

[@Ergeniz]

Better analogy would be your friend is generous in lending you money because he always places a small interest rate on top of it. So in the end, he can appear philanthropic but in reality is making a profit.

[@stanzacosmi]

This is exactly what I've been saying. I appreciate sega's fan project rules as it is currently, but i also understood that it's because it makes them the moooooolaaaaaah

[@ThePastAnalysis]

This was an amazing video! Well worth the wait! I personally loved all the discussion about law and business. I especially loved the Sega case law you mentioned. I'm biased towards this stuff, because I'm in law school and a huge Sonic fan.

[@maxspecs]

The Boss Music during the segment on Penders got a chuckle out of me, not gonna lie.

[@nalicompleteworks]

Well researched and reasoned, though there's a couple points I expected to come up near the end that didn't. 1, if upper management's apathy in prior years was driven by the overwhelming strength of pachinko profits, then the inverse is likely true these days as regulatory/cultural/economic forces have battered the pachinko industry and its stance in SegaSammy's revenues with it. They _need_ other sides of the business to pick up the financial slack, and god knows their ever-failing resort segment isn't going to be the one to do it. 2, even in the face of Sega taking brand management more seriously than they ever have before, that's come hand in hand with them formally leaning on the talents of professionals who worked their way up from making fan content in the first place. Their social media team pioneered online brand presence strategies by being intensely savvy about the series and the fanbase's relationship with it, the entire classic run of the series got remade and then added to by guys who cut their teeth as hackers and fangame devs, and much of its modern visuals and narrative are driven by folks who hopped from fan comics to official comics to formal Sega consultants. It's... difficult to see them start taking moves to poison a well of ready-made talent that's been so lucrative for them to draw on.

[@tinycatfriend]

whoa, you just made copyright law and corporate bullshit ENTERTAINING! that's a real feat on its own! i just read your channel bio and i've got a lot of respect for you, wishing you the very best!

[@jenixelle8298]

Holy crap, I love your videos! I just discovered you from your JRPG god video and your videos are so thoughtful, interesting and thorough. I love all the historical context and commentary :) My only complaint would be some sources but other than good stuff. Plus using your revenue to donate to Doctors Without Borders really makes your content come across as genuine and more passionate.

[@breno8119]

That's the kind of content I want youtube, good job.

[@blondesummer7980]

Interesting video and topic. The bottom line is, companies are not your friends.

[@parapro3799]

Moon Channel, you are doing some excellent work on this channel. Keep it up!

[@AJcore]

I feel like your commentary/opinions seem more like logical conclusions than anything else. Keep up the great work!

[@TitusRedwind]

2:26 I thought you said MURDERS and sales and I was flabbergasted as to why this wasn't a video about a serial killer who targeted videogame studio executives.

[@moon-channel]

This is something like the 5th comment where someone has heard "murders" instead of "mergers", and that is very charming and funny to me. If we talk about mergers and acquisitions in the future, I'll have to make sure to pronounce "mergers" more clearly!

[@Antihamyt]

This is quickly becoming a new favorite channel for me, very respectable mission near the end of the video. Looking forward to the next video my friend whatever it may be.

[@secretscarlet8249]

I’m always interested in the making of stuff of video games but the legalities, albeit important, bores me. Thanks for making it palatable and easy to understand! Also your diction is pretty great since I can understand you without needing subtitles. 👍👍👍

[@richardconnor2871]

This was a heck of a rollercoaster of topics, and absolutely fascinating! Thanks for making it!