The subject of legalized gambling (casino development) in Japan has been debated for some time now, and considering recent developments, it looks as though the proverbial wait for the other shoe to drop may finally be over. [
Barrons] [
CNBC]
What is interesting (Relevant) to our cause here is that Sega-Sammy could quite possibly be one of the chief benefactors of such a legislative deal being reached. Although it could take until the 2020 (Tokyo) Olympics until a casino is feasibly able to be operational; such a development would provide an immediate boost for the company financially and would secure their position in capturing future market share. [
Business Week]
For the past year now Sega-Sammy has seen their stock rebound tremendously and the 52-week high has skyrocketed about 88% [
Sega Sammy Holdings]. This development in my opinion would help place the company in a more competitive position within the marketplace. In addition to creating a bigger demand for their gaming machines, they will be able to add diversity within their corporate structure which would help push revenues even further. This
new hardware venture could quite easily help support their traditional gaming divisions and would provide further cash infusions were they would most be needed.
Developments such as this are important for Sega in order for them to be a relevant force within the gaming market. Following their exit of the home console arena they have struggled heavily in creating a new identity for the company and their merger with Sammy has not paid any dividends, that is until recent events...In other words, in order for Sega to attempt to continue franchises such as Shenmue they need be more than just solvent as a company. They need to pursue diversified business strategies in segments such as computer gambling in order for them grow as an organization following years of corporate consolidation and restructuring.