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Sometimes, it can take a good decade to get a decent interview.
It's OK — we're patient people.
In 1999, Bernie Stolar's Japanese bosses let him go as President and COO of Sega of America — right before the launch of a system he helped create.
Now, 10 years later, he talks to Bitmob about his ouster, how Sega dropped the ball on the Dreamcast after he left, EA's attempted bullying of Visual Concepts, what he thinks about today's Sega (it's not good), and a huge corporate prank he pulled on Sony — one of the greatest the industry's ever seen.
Bitmob: If we could send you back in time, with the benefit of hindsight, what would you do to make the Dreamcast survive and thrive?
Bernie Stolar: It’s called money. And a commitment from the company.
When [former Sega President Hayao] Nakayama was pushed out of the company, the company really changed.
Bitmob: How so?
BS: The heart and soul of Sega came from him, and he really believed that software drove hardware — which is true. He also believed that if you’re going to be a major competitor in the gaming world, you needed to own the hardware platform.
Bitmob: So what did Sega do wrong after you guys left?
BS: When Nakayama was pushed out and when I was pushed out, I think what took place was, Mr. [Isao] Okawa, who then became the chairman of the company — he was an investment banker from CSK [Holdings Corporation]…. I don’t believe he was committed to the hardware. He just believed it should be a software company.
Bitmob: And that was ultimately the Dreamcast’s downfall….
BS: Yeah, the company didn’t put the money into it. The company basically abandoned the system.
At that time, it was the largest launch in the history of the industry! The consumer judged that it was the right hardware and the right software. Look at the software that was on that system. Look at the sporting titles that Visual Concepts built for the system — after I bought Visual Concepts for Sega…those titles outsold EA’s titles. That tells you something about the software and the look, feel of the platform.
I fought to have a modem on the platform. Maybe it was early — who knows. But I fought for a modem in the beginning because I wanted to have massively multiplayer online games on that system.
Bitmob: Could you see the Dreamcast struggles coming before you left Sega?
BS: No. When I was pushed out, I assumed that the company would continue [supporting the Dreamcast]. Mr. Okawa was very close friends with [Masayoshi] Son-san, who was the chairman of [tech investment firm] Softbank. They indicated to Mr. Okawa that if we have a modem put into the system — we spend the extra money to put the modem in — that we should just meld the hardware online and not go through retail…that we should just abandon retail.
So do I believe there could’ve been a turning point where they would abandon this? The answer is yes.
To this day, you still can’t abandon retail. Retail may have shrunk — there may not be as many storefronts — but retail’s the whole point. Look at what Best Buy’s doing. Look at what Wal-Mart’s doing. Look at what GameStop’s doing.
Bitmob: Does it surprise you that Dreamcast’s online capabilities didn’t catch on better at the time?
BS: It doesn’t surprise me, because there wasn’t software tied into it. They were not building and going after software to start that.
I mean, I was looking for developers and content providers to start doing that. Sega did not do that after I left. They just abandoned it.
Bitmob: A lot of gamers swore off Sega hardware after the days of the Sega CD, the 32X, and to a lesser extent, a poorly supported Saturn. Do you think this backlash affected the Dreamcast?
BS: I don’t think there was a backlash at all. The Dreamcast was very well accepted. The consumer was thrilled that Sega was back with a great hardware system.
Bitmob: What are the biggest cultural differences between working at Sega and working at Sony? [Ed. note: Before taking over Sega of America, Stolar was the excutive vice president at Sony Computer Entertainment America.]
BS: [Long pause] That’s a question I’d rather not answer.
Bitmob: Were there a lot of differences in hardware-launch philosophies between Sega and Sony?
BS: I think both companies are very market-driven. Both their philosophies were, “Go big or go home.”
Bitmob: What do you think about where Sega is now, being a third-party publisher?
BS: I think they’re going through some really difficult times. I don’t believe they have the content, developers, and producers there that they had at one time. I don’t know their financial position, but they’re probably not spending the type of money they should be spending. You tell me the last time you saw a great Sonic game.
Bitmob: How do you see Sony?
BS: I’ll tell you the other difference between —
I’ll answer the question of the differences between Sony and Sega. Sony is a very corporate structure. It’s a real corporate company. Sega was really run by entrepreneurs. It was more of an entrepreneurial company. That’s the difference.
Bitmob: So how do you see Sony now? Do you still feel that way?
BS: It’s a very corporate culture. The team that’s there right now — I hired a number of those individuals — they’re terrific people. They’re really trying to make this work.
Bitmob: The big thing I think people would like to hear in your own words is, why were you let go from Sega right before Dreamcast’s launch? Why right then?
BS: As I said before, Mr. Okawa…he wanted to release this strictly on the Internet and I refused! He and I just went through major differences.
One of the problems also — I had just bought Visual Concepts for $10 million. When we were signing up third-party publishers, Larry Probst came to me, and at the time, he was CEO of EA — and also a good friend of mine.
Larry said, “Look, we’ll come on your platform, but this is the royalty rate we want to pay.” I asked what is it. He said, “We want to be the only sports franchise on Dreamcast.”
I said, “I’ll agree to that, but you’ll be the only third-party publisher that will have sports. But you’re going to have to compete with us because I just bought Visual Concepts.” And he said, “No, no, no, no…then you should not do the deal with Visual Concepts.”
I said, “No it’s too late.” [Laughs] “We’ve already signed the documentation. We’ve already taken the steps.” So because of that, he did not go onto the platform.
Bitmob: We once heard a story about you bringing some Sega branding to a Sony-sponsored golf event — a Sonic mascot as well — and this being one of the last straws in your relationship with Sega Japan. Is this true?
BS: Let me just say this. That had nothing to do with my ouster at Sega. That event took place in 1997, I believe. I was ousted in 1999.
But it is true that Sony was holding its first golf tournament — I believe in Napa [California]…I forget which golf course. I had someone go to the golf pro, paid him money to take out all the Sony golf balls and put in Sega golf balls instead.
And I had somebody dressed up as Sonic driving around the course, and skywriters writing “Dreamcast is coming” up in the air. That part is true, yes.
[Current Sony Computer Entertainment President and Group CEO] Kaz Hirai and [current SCE Europe President and CEO] Andrew House both called me and said, “You’re a great friend and a great competitor — and that was pretty damn funny.”
But that had nothing to do with my ouster.
Bitmob: Do you have an all-time favorite Dreamcast game?
BS: Probably Crazy Taxi.
Bitmob: Is there anything else you’d like to add for our Dreamcast 10th anniversary celebration?
BS: Let me just say this: It was a great team of people who were there at the time. When I got to Sega, there were 300 some odd people, and I took the staff down to 91 people, and we built it.
I brought in people like [former Sega of America President] Peter Moore, who came from Reebok and is a great brand builder. [Former Sega Senior VP] Chris Gilbert came out of a hardware company and never sold games before, but he really understood retail.
And Sega’s always had some of the best development talent around. If you look at [Yuji] Naka, Yu Suzuki…those were tremendous talents!
And don’t forget, it’s all about software — nothing else.