Authors: Steven Kent
The Ultimate History of Video Games: From Pong to Pokémon and Beyond—The Story Behind the Craze That Touched Our Lives and Changed the World (53 page)
Nintendo teamed up with IBM to design a custom-built 64-bit chip for GameCube. Because Nintendo was so quiet about the system, many skeptics doubted its ability to compete with Sony’s PlayStation 2 and Microsoft’s Xbox. Big mistake. GameCube may look like a toy, but going into the 2001 Christmas season, it could compete with anything on the market.
With the launch of PlayStation 2, Sony officially launched the most recent generation of video game hardware.
Twenty years and 100 million Game Boys later, Nintendo of America president Minoru Arakawa and Mario still have reason to smile.
First appearing in the 1981 game
Donkey Kong
as a carpenter named “Jumpman,” Nintendo’s Mario is the elder statesman of the gaming industry.
The Birth of SegaWhen I was a youngster, I went to Coney Island. Like everybody else in New York City, I played the games in the penny arcades. That was really my total knowledge of the business.
—David Rosen, cofounder, Sega Enterprises
David Rosen and Michael Kogan … just a couple of guys living it up in Tokyo.
—Bernard Stolar, chief operating officer, Sega of America
Sega
is not a Japanese word; it is an abbreviated form of Service Games. Though the company is headquartered in Japan and has a Japanese corporate culture, it was founded by Americans.
The history of Sega can be divided into two distinct stories. One is the story of Sega; the second is the story of David Rosen.
My Dad was in Hawaii when the Japanese bombed Pearl Harbor. He ran the slot machines on the bases. When they bombed Pearl Harbor, there was a note on one of the slot machines that said, “In case of another attack, jump under this machine. It’s never been hit yet.”
—Lauran Bromley, president, Bromley Incorporated (daughter of Marty Bromley)
Service Games began in May 1952, shortly after laws were passed restricting the use of slot machines in the United States. Prior to those laws, a man named Marty Bromley managed game rooms with slot machines, pinball tables, and other coin-operated amusement devices on several military bases in the U.S. Territory of Hawaii. In 1951, after the laws changed and the government confiscated the slot machines, Bromley and his father purchased them from the government, then shipped them to Japan, where they set up game rooms for servicemen stationed there.
By most accounts, Japan of the early 1950s was practically a Third World nation. The country’s industries were greatly depleted during the war years, many of its factories had been destroyed, and a large portion of the workforce had died. Though the United States was a generous victor, Japan’s recovery was slow.
Bromley set up a lucrative trade. He branched out into jukeboxes and opened a manufacturing plant called Nippon Kikai Seizo. By 1960, Service Games, also known as Nippon Koraku Bussan, was one of the three largest coin-operated entertainment companies in Japan, along with Taito and Rosen
Enterprises Ltd. By this time, Bromley had two partners, Dick Stewart and Ray LaMaire, who stayed in Japan and managed the business.
In 1964, they took on a new partner, a man named David Rosen.
There are two people who played a very important role in the opening and establishing of the coin machine industry in Japan. Dick Stewart and Ray Lemaire had come to Japan in 1952 and, sharing an office as a bedroom, had from scratch built a major operation on the U.S. military bases. They called their company Service Games. From this start they expanded into the Japanese marketplace, establishing a Jukebox operation that reached a total of over 5,000 locations. To service this route they had established branch offices in every major city in Japan. By this time they had two companies, Nippon Goraku Bussan and Nippon Kikai Seizo, which they merged into one. The company had an extraordinarily well-developed corporate infrastructure and, like my company, had taken the best from both business cultures: Japan and the United States. It was with this company, named Sega, that I merged Rosen Enterprises Ltd., and Sega Enterprises Ltd. came into being.
—David Rosen
Twelve years after Service Games was formed, Mr. Rosen came in. He was already established, and he already had his own company.
—Lauran Bromley
You know, game machines, like a theater seat or a plane seat, depend on occupancy and depend on the time that they are used. If you charge $1 per play, but it’s only used ten times a day, you only make $10. Really, all you’re selling is time. Our machines were constantly going. I mean, [they were] going from morning to night.
—David Rosen
David Rosen was tall and thickly built, with dark hair and a strange calm intensity that suggested the ability to carefully consider issues under any circumstances. He could be friendly and quietly intimidating at the same time. He had served in the U.S. Air Force during the Korean War. In 1951, as Marty Bromley started his slot machine business, Rosen was stationed in the Far East. He traveled to locations such as Shanghai and Okinawa but spent most of his time in Japan.
While serving in Japan, Rosen came to believe that the Japanese people were too industrious to remain in their present circumstances. Seeing an opportunity, he started up a business even before he was discharged. After finishing his commitment with the Air Force, he returned to the United States, hoping to further his college education and establish his business.
My first business was actually involved in art, strangely enough, which is about as far from the current business as you could be. In those years Japan was still in an economic postwar strata and, consequently, there was still a lot of unemployment at the time. A lot of the artists were doing portrait painting based on photos. I established a company in the United States that sent photos back to Japan to be made into portraits.
—David Rosen, founder, Rosen Enterprises, Ltd.
When his portrait business failed, Rosen decided to return to Japan and start a new business that he would run while living in Japan. He studied the people and their needs and found an intriguing possibility.
At that point in time, the people in Japan had a great need for ID photos. You virtually needed an ID photo for school applications, for rice ration cards, for railway cards, and for employment, obviously.
We’re talking about 1953, 1954, and the photo studios generally charged what was then 250 yen, and it took two or three days to have the photos done. My thought was that we had, in the United States, photo mat studios that charged 25 cents, and you could get four photos. They were called Photomats—little booths that were completely automated.
—David Rosen
American Photomat booths were not an ideal solution, however. Upon returning home, Rosen discovered that Photomat pictures faded after one or two years. If he wanted to bring Photomats to Japan, where the pictures would be used on official IDs, he needed to find a way to produce pictures that could last for four or five years.
After some research, Rosen discovered that the problem was easily solved. Photomat pictures were made without negatives—an automated camera snapped the shot, then flashed the image on positive paper. If this process were carried out adhering to certain temperature specifications, the pictures would not fade for several years. The booths, however, lacked temperature controls. The people who ran the companies that made the booths believed that their customers viewed the pictures as having only novelty value.
Adding temperature controls would have been too expensive, so Rosen came up with a more practical solution. He left the automated camera device in the booths and placed workers behind the booths to develop the pictures by hand while monitoring the temperature. With the economy as weak as it was, Rosen had no problem hiring workers.
I took some older machines that were in the United States, redesigned them, and brought them into Japan. This was the beginning of 1954. We put out the first couple of booths, and it turned out to be wildly successful. We charged … I believe it was 150 to 200 yen, which was less than the 250 yen [charged by photographers], and obviously we were able to develop it in about two or three minutes. The Japanese for this business was
Nifun Shashin
, which means “two-minute photo,” and Photorama was the name of the brand.This became so successful that it enabled me, over a short period of time, to open up well over a hundred such locations throughout Japan. There were different times when people would go through school applications and whatnot, and it was not unusual at those times of the year for the lines to get into the booth to be an hour, hour and a half.
—David Rosen
If anything, Rosen’s Photoramas proved too successful. Although his prices were only slightly cheaper than those offered by photographers, the
convenience of picking up pictures within a few minutes attracted customers in droves. As his business grew, photographers started to complain and eventually protested to the U.S. consulate. When the consulate asked Rosen for help, he offered to license Photorama franchises. According to Rosen, this may have been the first franchising business in Japan.
