Sega's Global GAAS Strategy: Insights from President Shuji Utsumi

In a recent interview with The Game Business, Shuji Utsumi, President and Chief Operating Officer of Sega Corporation, elaborated on the company's strategic pivot towards enhancing its global Games as a Service (GAAS) business model. Utsumi emphasized that companies with a strong operational history are more likely to succeed in the competitive GAAS landscape, which has become increasingly vital in the gaming industry.

Sega, known for its legacy in console and PC gaming, is currently focusing on the free-to-play mobile gaming segment, with titles such as "Sonic Rumble" leading the charge. Utsumi noted that while the standalone gaming business is showing improvement, the global expansion of its GAAS offerings remains a significant hurdle. "That’s one of the biggest challenges," Utsumi stated.

The GAAS model allows companies to generate ongoing revenue through in-game purchases and subscriptions rather than relying solely on one-time game sales. This shift has been driven by changing consumer preferences and the increasing popularity of mobile gaming. According to data from the NPD Group, the mobile gaming market in the United States alone was valued at $22.8 billion in 2023 and is projected to grow further.

In a related discussion, game director Makoto Tase commented on the reception of monetization models such as gacha mechanics, which have faced backlash in markets outside of Japan. Tase explained that these models have not achieved the expected success among global audiences, which influenced the development decisions for "Sonic Rumble."

Utsumi, reflecting on Sega's acquisition of Rovio Entertainment in August 2023, expressed confidence in leveraging Rovio's expertise in mobile gaming to bolster its GAAS initiatives. "Rovio has deep knowledge of the global mobile business and a strong intellectual property with 'Angry Birds,'" he remarked. This collaboration aims to create appealing GAAS titles featuring Sega's iconic characters, including Sonic.

Furthermore, Utsumi pointed to the success of the Sonic film franchise, which grossed over $1 billion globally, as a significant factor in boosting game sales. He noted the importance of cross-media synergies, stating, "The films have had a major impact on the franchise, leading to a significant boost to Sonic game sales."

Despite the optimistic outlook for Sega's GAAS strategy, the broader industry has seen mixed results from live service games. Notably, Sony's recent struggles with its live service shooter "Concord," which faced immediate removal from the market after a substantial investment, highlight the risks involved in this business model. In January 2025, Sony also canceled two additional first-party live service titles, indicating a cautious approach moving forward.

Industry experts, including Hermen Hulst, former head of PlayStation Studios, have acknowledged the challenges of differentiating live service offerings in a saturated market. "Some really big efforts went into that title, but ultimately it entered into a hyper-competitive segment of the market," Hulst commented, reflecting on the need for better strategic planning.

In conclusion, while Sega is committed to expanding its GAAS footprint with strategic partnerships and leveraging successful franchises, the path forward is fraught with challenges. The success of this initiative will depend not only on the execution of new titles but also on the broader industry's ability to adapt to the evolving preferences of gamers worldwide. The coming years will be crucial for Sega as it navigates the complexities of the GAAS model in an increasingly competitive landscape.