In the event you weren’t paying shut consideration, you might be forgiven for not noticing that Sega – finest identified for Sonic the Hedgehog, Persona, and Like A Dragon – has quietly turn out to be an leisure powerhouse outdoors of video video games.
Thanks partly to the large success of Paramount’s Sonic motion pictures, plus mega licensee offers with the likes of Lego and Roblox, Sega’s transmedia enterprise has grown considerably since 2020, leaping 107 locations on License World’s Prime World Licensors listing to No. 39 – above the likes of Sony Photos. Sega says it now generates almost $1 billion in annual retail gross sales of toys, clothes and merchandise alone.
Justin Scarpone – who joined Sega earlier this yr following a prolonged profession at Disney and others – is the corporate’s new international head of transmedia, whose job is now to take the success of the Sonic model outdoors of video video games and replicate it with Sega’s different franchises, like Persona and Like A Dragon, throughout movie, streaming, TV, dwell exhibits, and merchandise.
Having joined the corporate six months in the past, Scarpone arrives at a busy second for its transmedia efforts. The corporate is gearing up for the discharge of the third Sonic the Hedgehog film subsequent month, and its live-action Like A Dragon collection premiered on Amazon Prime final month.
Chatting with VGC at Gamescom Asia, Scarpone mentioned he has huge ambitions for Sega’s future as an leisure firm and revealed he plans to open an official Sega retailer in Tokyo, Japan. Probably most enjoyable for older followers is the corporate’s initiative to convey again legacy IP like Loopy Taxi, Streets of Rage, and Jet Set Radio. Final yr, the corporate introduced a number of recreation revivals are in improvement, and confirmed movie and TV tasks for the likes of Everlasting Champions, Golden Axe, and Shinobi.
“The technique is to show us into an leisure firm with video games as our core pillar enterprise, simply as Disney would say movies are,” Scarpone instructed VGC at Gamescom Asia. “We need to be within the place the place it’s OK if there are individuals who love a few of our IP who’ve by no means performed a recreation, however have seen all of our movies, been to our dwell exhibits, been to our sights, or purchased our merchandise.”
Learn on for our full interview.
You’ve arrived pretty not too long ago into the method, however what’s been your evaluation on why Sega’s been so profitable in its transmedia efforts not too long ago?
I’ve been at it slightly over six months now. Once I labored for Disney, Sega had been my licensees, so I’d had an extended relationship with the manager staff. However what shouted out to me after I joined as a motive why it’s grown a lot [outside of video games] over the previous couple of years had been good selections round partnerships.
That features Paramount and Netflix, which has actually allowed us to succeed in a broader viewers. But additionally different issues like Roblox, which has blown out our attain with youthful demographics in most key territories. It’s a mix of those multiplatform approaches to getting the IP on the market within the case of Sonic, which then feeds the buyer merchandise enterprise.
I believe our core staff, notably in Burbank, who had been main that over the previous 5 years with the movie and streaming offers and driving the buyer product enterprise for Sonic, are a key motive why we’re the place we’re. Now I’m coming in and making an attempt to duplicate that in different territories, but additionally blow it out throughout our library of IP, which is the logical subsequent section.
What sort of enhancements have you ever recognized primarily based in your expertise, notably coming from Disney?
Effectively, Sega historically just isn’t an organization that was aggressively licensing out in any respect, so very not like Disney. And so you need to construct the tradition and the talent set of operating a profitable licensing enterprise. And that begins with bringing in actually gifted individuals, giving current staff members new alternatives, and a little bit of trial and error on the organization-building entrance.
And far of my first six months have actually been centered on that as a result of, with out that, any methods are usually not going to be one thing you can execute. So though I believe now we have a transparent strategic roadmap, most likely 60-to-70 p.c of my time within the workplace is about constructing the org throughout the totally different territories, together with increasing in North America and Europe, but additionally getting a footprint in among the Asian territories the place our enterprise is beginning to develop very properly, however we’re not structured but to actually maximize the transmedia alternatives.
And I might assume not less than for one more six-to-nine months, an excellent share of my focus can be persevering with to fill out the staff, bringing in new expertise from outdoors and in addition giving alternatives to gifted people inside Sega who historically had been possibly in a recreation studio or in advertising and marketing and making an attempt to present them new jobs.
Sega not too long ago broke into the highest 40 international licensees listing.
Yeah, I used to be fairly thrilled about that.
Different recreation publishers like Nintendo are additionally seeing large features not too long ago as a licensing enterprise, and PlayStation is aggressively pushing into transmedia. Do you assume we’re beginning to see recreation firms emerge as the following IP powerhouses, following toy and comedian firms in earlier eras?
Yeah, I believe it’s the logical development when you concentrate on how customers spend their time and their cash. I imply, the gaming business, as everyone knows, is the biggest type of leisure on this planet, and the hole between video games and the quantity two medium, which is tv, is simply increasing. So the expansion charges are literally larger on video games.
Regardless of the doom and gloom over the past 24 months about redundancies, and there was some ache within the recreation business, comparatively talking, it’s the major supply of leisure on this planet. And so it solely stands to motive that from there, as you’re constructing excessive affinity for these core IP franchises, characters, and environments, that there can be different alternatives to inform these tales on totally different platforms, content material, merchandise, and companies.
“I’d prefer to assume Sega is beginning to turn out to be one of many leaders among the many gaming firms, however my sights are set on making an attempt to compete with the perfect Hollywood studios in terms of managing IP”
And that’s one thing that Disney’s accomplished for almost 100 years, and Warner Bros., and Common, and others, with movies because the core pillar. Our core pillar simply occurs to be video games, and there are various different firms like Sega, like Nintendo and Sony as you talked about, who’re fairly comparable in that. They’ve their very own IP, they’ve a really robust core fan base and neighborhood, and so they can construct upon that in these different channels. So I believe you’ll see extra, not much less of that.
One factor I used to be going to say is that recreation firms are usually not as expert at this but. So in some sense they’ve, at this level, larger buyer loyalty, definitely bigger attain, however they’re not as environment friendly and as expert at operating these multi-pronged, transmedia companies but. I’d prefer to assume Sega is beginning to turn out to be one of many leaders among the many gaming firms, however my sights are set on making an attempt to compete with the perfect Hollywood studios in terms of managing IP, as a result of I believe if we attempt to succeed in that stage of excellence, we should always do fairly nicely.
On the subject of IP, Sega has so many beloved franchises on the shelf. Why has it taken so lengthy for the corporate to open the vault and produce a few of these again?
I don’t have an incredible reply, I solely have my speculation. My speculation is that Sega is well-loved as a model and as an organization exactly as a result of it’s not all the time succeeded. It’s had its ups and downs over the a long time, and I believe there was a interval, notably post-hardware Sega, the place they had been rather more about simply specializing in bettering the standard of their video games, getting distribution as extensively as doable, and so they had been a real 100% recreation developer and writer enterprise.
And it’s solely within the final six, seven years – and Sonic within the West was actually the catalyst – that they’ve been saying, ‘OK, we’re in an excellent place now, and now we have a number of IPs which can be the highest tier when it comes to recreation franchises, how can we construct upon this?’ On why they didn’t do it earlier, I believe it’s a wide range of components, most likely overwhelmingly pushed by the state of the enterprise on the time, which is that they knew they’d this plethora of IP at various levels of consciousness and affinity, however however, extra IP than most firms. And now I believe we’re lastly assured that we’re at a spot the place we are able to actually construct an leisure firm round that.
And that’s why I used to be employed, and hopefully, within the subsequent few years, we’ll be capable of execute in opposition to that technique. However that’s the technique – to show us into an leisure firm with video games as our core pillar enterprise, simply as Disney would say movies are. We need to be within the place the place it’s OK if there are individuals who love a few of our IP who’ve by no means performed a recreation, however have seen all of our movies, been to our dwell exhibits, been to our sights, or purchased our merchandise. Hopefully, we are able to get them to play video games as nicely.
Sega is at the moment planning to convey again some actually historic franchises throughout video games, tv, and movie, like Everlasting Champions, Shinobi, Comix Zone, House Channel 5 and Loopy Taxi. A few of these IPs are almost 30 years previous, so how difficult is it to make sure that they’ll nonetheless resonate with a contemporary viewers?
Effectively, to a level, you need to reinvent them. I believe there’s a core set of IPs which can be at the moment the core pillars of our firm: you may have Sonic and Pals, you may have Persona, you may have Like a Dragon, and I might additionally positively put Offended Birds in that bucket. Additionally, among the issues we do in Europe are fairly attention-grabbing, like Soccer Supervisor, which could be very secure and has a really loyal viewers. Artistic Meeting has Complete Battle as nicely.
“We need to be within the place the place it’s OK if there are individuals who love a few of our IP who’ve by no means performed a recreation, however have seen all of our movies, been to our dwell exhibits, been to our sights, or purchased our merchandise.”
So now we have these companies the place, over the following five-to-ten years, now we have a persistent slate plan, advertising and marketing initiatives, product, hopefully extra transmedia.
After which now we have what we name the Sega Legacy IP, which is those you’re alluding to, that return to the times after we had been within the {hardware} enterprise: arcade machines, Genesis / Mega Drive, and all that. And that is arguably essentially the most attention-grabbing endeavor for transmedia. We simply introduced not too long ago our plans to make a Shinobi movie, and Everlasting Champions has come out pretty not too long ago, I imagine, as nicely, as introduced. And there are extra that we’re engaged on.
The attention-grabbing factor about that’s you may have a technology of parents who keep in mind these titles fondly from their childhood or younger maturity, who’re of their 40s or 50s. After which you may have a youthful technology that, frankly, actually doesn’t have any connectivity to that IP. So, the problem is, if we attempt to reinvent these IPs, how can we join? Which platforms and the way can we evolve the lure for these IPs which can be lesser identified, frankly talking? And the way can we join with new generations?
So now we have a set of titles in improvement proper now that fall into that legacy bucket, which we introduced final yr at The Recreation Awards; Loopy Taxi, Jet Set Radio, Streets of Rage, Shinobi, and now we have one other Virtua Fighter being developed. And so all that’s very thrilling. After which in sure situations, we’re additionally doing animation collection, or live-action movies to enhance that and be a part of these roadmaps.
Shinobi is a case the place we each have a recreation and a movie and planning a manufacturing is the case right this moment. So will that resonate or not type of is dependent upon if now we have gotten higher as storytellers, and if we are able to attain youthful audiences whereas additionally reigniting the core followers. It’s an enormous, huge problem.
Do you search for any explicit qualities whenever you’re selecting which traditional legacy IPs you’re going to revive?
I had the identical query after I joined it, and I even requested it to [Sega America and Europe CEO] Shuji. And what I discovered, and he was very ardent about this level, and I believe he’s completely proper, is that the IP we’re specializing in is popping out of the fervour of our artistic groups. That’s each internally, and in sure situations on the movie facet, we’ve had screenwriters come to us and say, ‘I grew up on Shinobi, I’ve received an incredible story, and I need to iterate together with your producers’. Individuals have a ardour for a selected IP.
So, it’s an natural course of?
Sure, very a lot so, very a lot. There’s, on the industrial facet, the enterprise facet, if you’ll, there’s a, ‘hey, we need to ignite this initiative’. However inside what might be known as legacy, now we have, like, 30 IPs, proper? We’re not going to do 30 movies, or 30 video games. So that are those that we’re enthusiastic about? And it’s superb how many individuals really feel a ardour for a selected IP.
We let that organically gestate over time and work with the artistic people. And as soon as now we have one thing, we’re like, ‘yep, now we have one thing right here, let’s go speak to a studio’. Or within the case of gaming, ‘hey, let’s do an inline course of and put a cool dev staff in opposition to this, then do some prototyping’.
“We have now a set of titles in improvement proper now; Loopy Taxi, Jet Set Radio, Streets of Rage, Shinobi, and now we have one other Virtua Fighter being developed.”
I believe that’s type of the way it occurs even in Disney as nicely. In the event you go into Disney Animation or Pixar, they don’t dictate to the creators what the following story can be. They’ll say, yeah, we wish one other Toy Story or one other Frozen, in order that’s identical to we wish one other Sonic recreation, proper? However then there’s the world to play. So, I take a look at this as no totally different than Pixar engaged on a model new authentic IP. As a result of for many customers, that legacy IP goes to really feel model new. And we’ll see the way it goes.
With Paramount’s Sonic motion pictures, after that shaky begin with the design and fan backlash, it’s been fascinating to see how the choice to then stick extra intently to the supply materials has actually resonated with the viewers. So, coming from that, how necessary do you are feeling that fan-first strategy goes to be for the opposite properties?
Crucial.
You cite an excellent instance of the difficulty we had previous to the discharge of the primary Sonic movie and the way that was course-corrected and took off from there. However, to return off of Sonic for a second, I used to be in Taipei final week for a dwell live performance of our Persona music catalogue, which was the primary time we took the present outdoors of Japan, and it was simply… the place was rocking.
There have been so many followers that got here in cosplay, we did nice with merchandise gross sales, and it simply actually resonated to me that among the issues I noticed at Disney, going to love Star Wars fan occasions or Marvel fan occasions at Comedian-Con, you see the same kind of ardour within the eyes of these core followers. And also you notice how delicate it’s.
I had that in Disney with Kingdom Hearts, the place we had been engaged on Kingdom Hearts 3, and we had been doing fan occasions outdoors of Disneyland. It was like, now we have an enormous duty, as a result of these individuals have been ready, and so they actually care. And it’s an emotional factor for them, and so we have to super-serve that.
Franchises like Persona, Sonic, and Like a Dragon have that stage of fandom. So bringing these individuals in via these occasions, we do fan occasions throughout the areas an increasing number of. And speaking to them, typically even bringing them into improvement classes to get their enter.
The businesses which can be doing that nicely, I believe, are setting themselves up nicely. As a result of even in case you possibly under-deliver on one title, the followers perceive that you just’re valuing them. And on this technology, teenagers, younger adults, they’re so accustomed to that from manufacturers that you really want to take it significantly. And often it does make the product higher.
Thank god we listened on the Sonic subject. It’s an enormous lesson realized. That was nicely earlier than I joined, nevertheless it was one of many first conferences I had in our Burbank studio. I went there to satisfy the staff and requested them to present me a presentation on why they’ve been so profitable. And the very first thing they did was current their largest slip-up, which was that subject, how that took place and the way they corrected the ship.
It was an exquisite presentation, and it gave me confidence within the staff, at first. Nevertheless, the strategy that Sega is taking has additionally developed. And it’s amongst among the higher practices I’ve seen at Disney with how Star Wars manages the fandom.
“Thank god we listened on the Sonic subject. It’s an enormous lesson realized. That was nicely earlier than I joined, nevertheless it was one of many first conferences I had in our Burbank studio.”
How important is that dedication to authenticity? You touched on having to virtually reinvent a few of these very previous IPs, just like the Shinobi and stuff. How a lot does remaining genuine to the supply materials apply to these? Would you are feeling extra assured to make sweeping modifications to legacy franchises?
My very robust private perspective on that’s we must be rather less cautious and slightly bit extra creatively formidable. As a result of the actual fact of the matter is that in comparison with these very fleshed-out at this level RPGs, just like the Persona franchise or Like a Dragon, these titles return to eras the place there was little or no storytelling you might really do on these units due to the technological limitations in an arcade machine in 1989 or a Genesis within the 90s.
So, the lore just isn’t on the similar stage of element as a few of our extra ‘trendy’ or more moderen IPs. And subsequently, a part of the enjoyable of that venture is basically inventing the lore with some callbacks, clearly, to again within the day, if you’ll.
With Shinobi, for instance, you may have Joe Musashi, the core character, a modern-day ninja. And there are some episodic or, let’s say, iconic moments within the previous franchise video games that we are able to name out within the film script or within the reboot of the sport. However I believe now we have to do much more as a result of video games in 2025 or 2026, the extent of storytelling and gameplay has simply clearly developed tremendously. If we’re too cautious, I believe we’ll under-deliver, creatively talking.
Do you are feeling it’s necessary to contain the sport creators in your transmedia efforts?
Oh, it’s, and we do fairly a bit. What we’ve structured, and that is attention-grabbing as a result of it’s developed over time, for instance for Sonic, the components has actually been the ‘godfather’ of Sonic, Iizuka-san, has been dwelling in LA the previous couple of years. And he sits proper with that transmedia media staff within the Burbank workplace. They’re not making video games there: it’s the transmedia group. The video games workplace within the US is in Irvine.
And so clearly, he goes to Irvine after they’re creating a brand new Sonic recreation, and he visits Tokyo and works with the Dev Studio in Japan, however more often than not, it’s positioning him with the transmedia people as a result of they’re actually evolving the lore at this level.
For this new IP initiative, the Legacy collection, we simply introduced a man in, former Lucasfilm and Common, who I labored with for ten years at Disney, named Hez Chorba. Hez is overseeing the transmedia evolution of the legacy collection. I introduced Hez in as a result of he’s a storyteller, and he did that for Lucasfilm throughout video games. Each Lucasfilm recreation within the final decade, he led artistic artwork, all of the EA stuff and Ubisoft and all that.
But additionally, he labored on the theme park, Galaxy’s Edge, he labored on the Disney Plus collection, so he’s received a seat on the desk. He was in command of the gaming artistic, and he can be on the entire transmedia stuff for Star Wars, so he knew the lore intimately. I introduced him to Sega as a result of we have to construct lore for our legacy collection, and we’re driving that initiative out of the US workplace.
“My very robust private perspective on that’s we must be rather less cautious and slightly bit extra creatively formidable [with legacy franchises].”
On the similar time, the video games are being made in Japan, so he spent a number of time with the EPs of every of the sport titles and integrating some connective tissue between the non-games and the video games. Meaning ensuring there’s a core lore that connects to each whereas permitting for platform-specific freedom, if that is smart. So, the sport makers are making the video games they need to make, nevertheless it has some connection to the US constructing.
For the opposite IP, Like a Dragon and Atlas, that kind of artistic management for each transmedia and video games sits in Tokyo. For these IPs, the tales are very fleshed out at this level and the creators ought to be in Tokyo. I’ve a head of transmedia for Like a Dragon, for instance, and he or she’s flying to the US and Europe rather a lot to switch the information of the IP after which interpret that to make it extra aggressive for Western markets, working with Amazon on the collection and all that, the live-action collection on Amazon Prime for Like a Dragon.
How cohesive is your imaginative and prescient for all of these legacy franchises? Might we see one thing like a Sega cinematic universe? Are they going to be related actually or philosophically?
I believe the IP, the portfolio now we have normally, exists in their very own persistent universes. As a result of Marvel did it higher than anyone, and I find out about that as a result of, clearly, I used to be there for 17 years.
However I believe one of many concepts we’ve been toying with is, are there situations the place you are able to do that? In one thing just like the buying and selling card companies, the place you’ll be able to convey all of them collectively, not dissimilar to what Disney’s accomplished with Lorcana not too long ago, the place it is smart. And you may create a recreation like I’ve labored on, Disney Tsum Tsum, the place you convey all of them collectively beneath one umbrella.
However they’re toys, and other people perceive it’s not the true factor, so Marvel being subsequent to Pixar is smart. From a client product standpoint, yeah, we’re going to have product traces that try this, however from a recreation universe standpoint, I’m not so positive that’s what followers need. I personally, creatively talking, I’m not satisfied of that.
Placing Like a Dragon with Offended Birds, the query can be, why? I believe it’s a little bit of a stretch. Since you don’t see Harrison Ford in a film with Anna, and there’s a motive why. And so I don’t assume within the recreation enterprise, essentially, we’ll be in that route. However there might be possibly one Tsum Tsum-like instance that we try this.
However I believe it’s extra most likely going to be on the buyer product facet. You’ll see product traces which can be actually sitting beneath the Sega model, which is the final level I’d like to say.
One of many core issues about our transmedia staff is we’re actually centered on elevating and strengthening the Sega model. As a result of our portfolio could be very broad, however the frequent thread is the Sega model. Sega already has a stunning quantity of fandom as a model, and we have to take care of these followers and provide new experiences to them, whereas placing the stamp of Sega on it extra proudly.
In the event you go to retail right this moment, you don’t see ‘Sega’ sufficient. For instance, we’re opening a Sega retailer subsequent summer time in [Tokyo’s] Parco. There can be a Sega retailer. We’re additionally going to be doing the same venture in Shanghai, the place we’ll have a retailer there as nicely through a accomplice.
It’s actually thrilling, and we have to do much more of that as a result of Sega is a client model that’s surprisingly not in entrance of customers sufficient. Sonic is, however Sega isn’t. That’s considered one of 35 issues I’m engaged on proper now!
