Sega FY 1997 - The Slow Death of a Titan
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- เผยแพร่เมื่อ 1 มิ.ย. 2024
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This video was re-uploaded after a copyright dispute. It is not monetized.
So what exactly "killed" Sega? The troubling thing about this question is it really cannot be answered in a single video. What can be said is they lost quite a bit of money throughout the 90's. Thanks to the recent leak of the Sega FY1997 Brand Review, and translations of recent statements from former Sega of Japan execs, we now have a much more clear view of Sega's slow bleedout. This video seeks to summarize the important details of the document, how they link to the recent revelations from the SOJ execs, and tie them to the numerous other sources picked up over the years. This shows what went on behind Sega's doors throughout the 5th gen.
SegaFY1997: segaretro.org/images/8/8c/Seg...
Shoichiro Irimajiri and other translations: mdshock.com/2023/07/10/irimaj...
Thumbnail made by SaturnDave.
Tracklist: pastebin.com/raw/kt1d8piZ
00:00:00 Intro
00:04:55 Life
00:15:02 Goal 1
00:19:21 Goal 2
00:28:57 Goal 3
00:33:50 Goal 4
00:36:24 Goal 5
00:40:05 Goal 6
00:46:46 Goal 7
00:52:03 Goal 8
00:54:02 Goal 9
00:54:43 Death - เกม
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This video was re-uploaded after a copyright dispute. The original upload (posted on September 16 of 2023) had 19,492 views, 1,360 likes and 21 dislikes. It had 402 comments, including my own.
The disputed material was swapped out. I also took this time to add new Patreon subscribers to the credits, specifically those who subbed to get early access to this very video. I also made a few very minor editorial changes to draw attention more closely to the subject matter at hand. No changes were made at the request of viewers.
This video is the equivalent of realizing that your Dad lied to you after all these years. But at the same time it brings solace on the feeling of my heart being empty. Like, cool, I know now. But this wound has been healing for over 20 years. Still gives me heart palpitation, it affects me to my core identity.
Just another TH-cam doing its best ... screwing their content creator videos...
I will gladly watch this AGAIN for the third time (counting the initial livestream where you just read through the thing) as it remains just SO fascinating to me. I never thought Fiscal Reports could be that interesting until you did this, but man, it sure does paint a great picture and you do a great job of compressing, explaining and illustrating all these points in a coherent way.
To be honest, if you ever get a copyright claim, always contest it. New TH-cam policies mean that the claimaint would literally need to take you and TH-cam to court in order to fully remove the video, and unless you have millions of subscribers, it's not worth their time.
I had that with the WWE at the beginning of the year.
thanks for the re-upload, are you allowed to tell us what part is missing? how long that section was, or was it just something minor?
i'm going to re-add my thoughts because they still hold true: these videos could be text-only slideshows projected on the world's emptiest wall and I'd still be on the edge of my seat just from the depth of research you put in, but then you go HARD on the editing and i love it
oh hello there
I run a small local game store where people trade in stuff, even entire collections. For Sega collections it usually goes like this: Master System, Mega Drive, Mega CD, 32X, PS1, PS2.
Easily one of the best Sega documentaries on the platform; it has such a surreal, dreamlike feel to it at times, and intentional or not, I quite like it.
I adore the Sega Saturn and several of its games, especially my dearly beloved NiGHTS Into Dreams, and it's a shame it didn't last very long due to all of the factors that led to its downfall outside of Japan.
Incredible - an hour long video which perfectly shows why SEGA is no longer in the console business
I love SEGA but hate how badly the business was ran as a whole in the mid 90s
Thank you Nick for yet another absolutely incredible video, we as a Saturn/Sega community absolutely do not deserve you ❤
And yet the Kalinske Plan was perfectly valid. We were all waiting in anticipation for the new $49.95 LockOn cart that would give us all advanced 3D capabilities in Spring of 1994. Four games had already been made for it that we know of: Daytona USA, Virtua Fighter, Virtua Racing, and Star Wars Arcade, all huge arcade hits. Those games would've flushed put all of that Genesis inventory and moved another 7-10 games on top of that. The Kalinske Plan would've made SEGA hundreds of millions more that were wiped out by the early launch of the Saturn and discontinuation of everything else in October 1995!
@@MaxAbramson3 32X was a mistake & Kalinske was against it. Plus he fought not to release the Saturn early. But Japanese culture had labeled Tom as a villain. He was winning & succeeding in America while in Japan Nakayama had to constantly see his team fail. Reportedly, from the mouths of employees, Nakayama physically abused people while shouting at them to be better like Sega of America. Suffice to say, the Japanese employees despised Kalinske & when the chance came to one up him (release the Saturn early) they pushed hard. Nakayama created a toxic culture & ultimately brought about Sega's failure.
Edit: tldr; yeah, Kalinske was right & Japan should've listened to him 100%. The guy made Mattel a leader in the toy industry - he's very good at his job
I cant tell you how great this video was. This is real history about a console that was forgotten over time. Its so cool to see others so passionate about the saturn. Its my favorite console. Your channel is so high effort and high quality for relatively low views, it definitely deserves millions of views. But just know youre doing a real service for all us hardcore old school sega fans
I was terrified that the full clip of the airport ad was the one taken out, but fortunately it is still there. I can rest now
Sega predicted 9/11
My man..I’ve watched this video like five times now, front to back. It’s honestly one of the greatest things I’ve ever seen.
I would love to track down one of the hapless programmers at Microprose and ask them what the deal was with their NFL game that was better off dead.
As I said before: It's like watching a trainwreck in slow motion...
Anytime I watch a video on the history of Sega as a console manufacturer I keep thinking to myself "y'all MFs are dumb as hell".
Watching this for like the fourth time. It’s nice to have in the background while I work, and I’m still utterly stunned by how… insane Sega of Japan and America both were in similar and different ways.
Having now watched your review archive (you got me hooked, not gonna lie!), it’s astounding Sega was as arrogant as they were. This was… the writing was plainly on the wall. My god.
This is by far the best documentary about Sega I've ever seen. Every other retro gaming channel just regurgitates the same b.s. over and over. Tom is a super genius that was always right about everything and always the good guy, Sega was dominating the 90's(genesis here and the Saturn the japanese market) and money was flowing in like water with no financial losses/instability/shakey ground underneath it all, soj are dumb and evil people who destroyed their own company because they were jealous of Tom b.s.
Tom Kalinske was no angel, but Bernard Stolar was not the right man to clean up any mess that had already been made. All he did was smear it everywhere and make more.
Tom was right about every decision except one critical one: Not bringing out superscaler 3D games for the Sega CD in advertising them. People who saw us with a $300 addon assumed that we'd been duped into buying a machine that only played s***y FMV games and lazy ports.
@@MaxAbramson3 Did my comment get deleted?
@@Carsonj13 I've had a lot of comments getting deleted lately.
@@MaxAbramson3Same thing happened to me.
The editing and atmosphere in this video is sill untouchably great!
It's almost better than Metroid Prime.
Excellent job on this, mate! I mean, Jebus, depressing as fuck to see Sega slowly dying in this way, but excellent job at collating all the info from the leaked document into a watchable form.
Excellent video that sadly shows precisely how dire things got for Sega and makes it completely understandable as to why they failed as a hardware company.
This video is so interesting. I'm really glad the file got leaked, because it does answer a lot of questions about how exactly SoA got themselves into such a hole, why the Saturn languished from start to end as it was accepted too late, and dropped too early in the USA.
Thanks so much again for this eye-opening documentary. I watched it again. I laughed out loud at the wonderful footage of Mr Bone's voice actor displaying his musical prowess to impress the ladies. Strange that SOA had such high expectations for Mr. Bones. I can't wait for your Sega Rally documentary!
As I commented on in the last version: Thank you for doing this video. I knew SOA was in dire straits, but I had no clue that it was this bad. I still wonder if even Sonic Extreme could have remotely saved the company
Plus, all of the canceled saturn games
Kinda, but if SOJ didn’t force SOA to release the Saturn four months earlier to get a head start on the PlayStation internationally, made the Saturn developer friendly and lowered the price of the console, it would’ve had a chance, but this was early to mid 90s SOJ and SOA, so their chances would’ve been botched either way.
@@benitosierrajr3958 The reason why SOJ forced SOA to launch the Saturn early was that SOA was bleeding money thanks to the 32X crashing and burning. The early launch was a an attempt by SOJ to stop SOA from sinking further into the red by putting a product they could actually sell onto the market.
If the console launched with it, maybe it would have made a dent. Keep in mind, Sonic was already starting to cool off compared to the Sonic 1 and 2 years but was still Sega's ace for sure. A 3D Sonic game launching with the console in late 95, might have done something.
That being said, by 96/97, with the die already cast, I don't think it would have turned anything around. In fact, with Super Mario 64 being a massive hit around that time (and already gathering hype at shows and in press), I question what the reception to XTreme would have been. But at best, it delays the inevitable. Buyers had already gone 3 years without a new Sonic by that point and many were firmly with Sony or Nintendo. If Sonic Adventure didn't do much to turn the tide for Dreamcast in 98/99 (depending on region), I don't think Sonic XTreme in 96/97 would've been enough for the much bigger task of saving Saturn.
Most of the American Saturn ads were cringy garbage. They should've just hired Chuck Norris and Haim Saban to Americanize the masterpiece Segata Sanshiro ads like the recent success of Power Rangers bringing Super Sentai to international television.
The Irimajiri comments really put into context the big 1993 Sega had. I think that was the year Sega made more profits than Nintendo and it was all over the gaming mags.
From what Irimajiri is saying, it may have all been inventory US retailers bought then returned, so the losses filtered through via those warehouses of unsold investory.
Also puts into context Nintendo's strict inventory controls and accusations of undershipping to retailers making a lot more sense than the charge that they did it to create demand with the retailers often being the wronged party. Seems like they were the problem and would order as many units of something as they could if they could just return it all later forcing the manufacturer to eat the losses.
I found myself pausing on just about every email/document here!! It must have been so much to read through and synthesize together, but very well presented and easy to follow-major kudos to you and everyone involved in the making of this!!!💯
Sega tried to take down your video because they don’t want people to see how bad they were at business decisions. Keep fighting the power, Nick!
Haha!! That would be funny, but I do not think that is what happened. :)
So the truth is, that in contrast to what we've always been told, SOA (Tom Kalinske) was the problem and NOT Sega of Japan. It seems the biggest issue is that SOA held on to the Genesis too long, and continually over-hedged their bets on juicing every drop out of the 16 bet era, rather than moving on to the 32bit generation before it became too costly for them. SOA was drunk off the success of Sega had amassed in the USA between 1990-94'. They should have discontinued the Sega Genesis/CD while they were ahead and prepared for a world wide Saturn launch, which would have avoided the 32x, the over manufacturing, and retail buy back problems. They also would have had a year head start on Sony.
So Tom Kalinske was a bad business man but Bernard Stolar was a stand up guy? What?
@@Carsonj13both are bad for different reasons
@@DestinyZX1 Kalinske merely became bad. Stolar was always bad.
@@Carsonj13 Agreed. In every aspect.
Sorry to hear the other video got taken down. This video is well worth the watch, great job!
I visited from mid December up until January 7th 1994 Japan/Tokyo and one thing i can tell, the PSX was sold out everywhere while Saturn was available. We had to go far away from the "center" of Tokyo to to catch some PSX (second batch delivery). On top of that only one PSX per person policy! That's how sought after this thing was.
Yes the Saturn sold out very fast in the beginning because of VF, and that's it. Of course I can only speak for the three weeks being there and don't know what happened after that. But again, PSX was HUGE right from the start. TV commercials en masse unlike Saturn. Also, the upcoming lineup of PSX games looked very promising with Raiden 1+2 being a pretty important title. And there was Tekken already in the Acades waiting to come home.
Just when you thought you had seen every great Sega documentary. Awesome job!
An absolutely sensational video as always. The content alone is first class but the presentation takes it to elite heights. I really appreciate your efforts, your videos are both insightful and entertaining. Thank you.
Nice to see it return. Incredible work as always.
Masterful job as always! Can only imagine the amount of editing hours spent on this. So many little things that go a long way! Thank you for the presumably exhaustive research!
So many memories of being a kid at this time and being beyond perplexed why Sega was releasing so many platforms!! Thank you for this!! Well worth the wait for your videos! I'm going to watch your NBA Jam video again now!! 🏀
This is such a great video! Glad to see its return!
I wonder which part of the video that did get a copyright dispute? Or perhaps some of audio?
Anyway, here's another thumbs up. 👍
Thank you for reuploading this!
This video made me sick to my fucking stomach. Good work scraping at the bottom of Sega's barrels and delivering the harshest, most brutal realities, in excruciating details. That last line, about Stolar, is brutal. Godspeed.
More like this, please.
That question about stolar really got me thinking... now my head hurts...😂
Only to those that think that Stolar was wrong. RIP!
@@Gamevet Stolar WAS wrong... Final Fantasy VII's success is proof of this. But yeah, I agree, RIP.
@@Carsonj13 Console RPGs in the west were a niche product. Even the mighty Final Fantasy III only managed to sell 650K units in North America. Grandia's sales numbers in Japan weren't even that good.
@@Gamevet Yeah, during the 16-bit era they were niche. by 1997, the writing was on the wall that that's what consumers wanted. Again, Final Fantasy VII proves this. Sony had gold with that game and they knew it, so they advertised the hell out of it. Viral marketing for games was practically non-existent before FF7. And Grandia sold 1 million units... On an installed base of around 5 million at the time... That's not good to you? Hm...
Sorry to hear about the former dispute. I'm back again to support this amazing video! Great work!
Time to watch it for a third time, amazing work as always!
Re-comment just for the upload. Stellar work, as always!!
I've watched this so many times and it made me open my eyes to the truth regarding SEGA. To think that SEGA was actually suffering this much is crazy. Absolutely crazy.
The ending though has me wondering. If I was Bernie Stolar, I would have basically cut my losses and just stop all support for the SEGA Saturn and focus all on the Dreamcast. But even with that, I don't think it would have been enough to save SEGA. In fact, I think SEGA was doomed even with the Dreamcast on the horizon. And yeah, I despise Stolar. I despise him for his hatred for 2D games, Japanese games and RPGs, because he thinks that it's niche... when it isn't. Personally IMO, I think he is a xenophobe or something. IDK. Once Final Fantasy VII dropped, RPGs would be in high demand and that the Saturn didn't have any RPGs hurt it in the long run. Honestly, both SEGA Japan & SEGA America are to blame but for very different reasons. A shame that the Saturn suffered because of it all. And I owned a Saturn. I only had ONE game for the Saturn and it was Virtua Fighter.
You make such great content! Thanks so much for the new video.
Thanks for the absolutely brilliant coverage of these documents and this era :-)
Thank you for making such indepth content.
Thanks for reuploading it
And I'll gladly watch it again.
Great work as always
Adding a thumbs up and a comment to help this excellent video get traction again
Still hurts my fan heart but dang SoA really was blast processing towards the bad future in 1997
Sega of America were incredibly short sighted and Sega of Japan were incredibly out of touch with the market.
Created quite a sandwich of failure.
@@planescaped Oh I agree both were not helping things. But SoA staff used to claim Genesis was still selling and SoJ announcing that all support for older systems would be nixed is what hurt them. When it seems the market just totally fell off the cliff once customers moved to next gen
I really is interesting, how the home console paradigm shift, literally led to the obsolescence of Sega as a hardware company, regardless of the fact that their consoles and games replicating the arcade experiences better than their competitors, the people chose Nintendo and Sony as their favorite because they wanted to move on to a home console video game experience...it's almost sad how that era of gaming was just abandoned by consumers hahaha
It's fascinating once again to revisit this and see how the current Sega leadership just canned Hyenas, but shows that they're still terrible in similar ways. I mean now that the behind-the-scenes drama coming out ( for example: th-cam.com/video/TkV5EPL1ER0/w-d-xo.html ) it's so clear that SEGA still struggle bad at earmarking money for the right projects and pushing the things that actually seem to have promise and will actually hit with their audience.
Good editing, informative, great video
If I was Bernie Stolar, rather than say the Saturn was “not our future” I’d instead say that we’re excited about the Dreamcast but there are still some great games coming for the Saturn and stress that there was still life in the console
Push the 2D powerhouse aspect and push the idea that 2D games still have a place in the Fifth Gen
You could even push a snazzy SEGA styled marketing line like “2D is just 2COOL” or something
Don’t say the quiet part loud basically
This was amazing. It's ridiculous this channel hasn't blown up yet.
Might be something to do with the fact he responds like a c*nt that thinks he can never be wrong .
I watched it before and I will watch it again because I love your videos. You need 1000x as many subscribers.
As a customer what killed sega was the sega cd 32X double hit. I bought both and after realising that sega would just take the money and make no games I swore off sega as a reliable company, and when a neighbor bought a saturn in 1996 only to be left without support just a little time later, that was all the confirmation I needed
Excellent re-upload of an excellent video.
bravo, amazing video, looking forward for more reviews and docs, subsribed
Perfect timing on that Sonic 3D blast deal with it ! LOL
Once again, great video man.
Take my like and another algorithm pleasing comment ^^
This is the most accurate history of sega downfall.
This video is a masterpiece!!!! Thank you!!!
Top tier content as always.
Mid 90s Sega wasn't just suicidal. It was streaming it all live with sponsors and giving out viewership rewards.
This is one of the best videos on the Sega Saturn to date. It really shows how even before the Saturn Sega was in huge trouble. Only issue I have with the video is that you said that the Sega Saturn was originally a 2d machine which I incline to disagree. I really hope you make a sequel of this video because this is truly a modern classic especially when it’s about my favorite 64 bit system
Thank you for the kind words. To your concerns about what was said about its origins: More recent interviews with Sega of Japan higher ups show that Saturn was initially designed to lean more into 2D. They gradually enhanced its 3D capabilities over time, and eventually added the second SH-2.
I have a question there’s this video by sixty rgb in which he said that the Saturn was a 3D machine at the start with hardware was based on thier arcade machine. I’m not sure if it’s true but I find it more compelling to why the Saturn was hard to develop. Problem is that it’s not well backed up. Is it possible that the Saturn was became a 3D machine through their experience with the Sega model 2 arcade broad
Saturn is 32-bit lol.
@@OhKayEl Sega Saturn doesn’t look 32 bit. Are you referring to the 2d games
@@TheSoldierinus Are you trying to tell me that the Saturn is in the same generation as the N64? Bro, it doesn't even have texture filtering and mipmapping just like the PlayStation, its "3D" is really just scaled and skewed sprites, also the N64 is turing complete.
Great doc, loved it
First off, thanks for the insane amount of work you had to put into this video. The amount of information is absolutely STAGGERING. I love it.
I think the most incredible thing I learned from watching this video, is for how bad Sega screwed everything up with the Saturn, how they managed to get their act together so quickly with the Dreamcast. Unfortunately, the Saturn (and yeah the 32X didn't do any favors) eroded consumer confidence so greatly, that Sega didn't have enough money to keep the Dreamcast going to fully re gain consumer confidence again.
Bravo! This was so good.
Thank you so much!! Means a lot coming from you. :)
Excellent work.
Question: what is the source of the interview at 20:53?
I conducted that interview alongside a translator known online as SamIAm. It is used in my Virtua Cop documentary: th-cam.com/video/OrMqYVB5G-4/w-d-xo.htmlsi=Ex-PU-EFK3bJiBrk
Keep up the great work!
Very well done video
They still should have set those 32Xs on fire
Thank you so much for the support. That would have a glorious, albeit smelly, bonfire.
Love the David Lynch vibes in the intro.
What a sobering video. The FY document being disseminated was a gift and we should be so lucky that we have even slightly more illumination on Sega’s troubled history.
good to see this back
Amazing! Excellent work though!
What an interesting look at the early part of the end. Having been part of companies in decline going through mergers, restructures, and layoffs I always find it amazing that usually everyone knows or can feel the prosperity has been lost... But what do you do? Good similar reading is out there on the US automakers, Xerox, etc.
Amazing video
Gonna repost an approximation of my comment on the previous version.
Was Stolar given an awful hand? Yes, and this proves as much. However, he still didn't even attempt to bluff with the hand he was given and just gave up. I don't envy the position he was in, but I can still condemn his lack of effort.
He had to be brutal.
Great documentary
Every video of you is art
I started to say,,, I know I remember watching, liking, and commenting on this excellent video. Sorry for the CR thing...That sucks. Fantastic video. History.
Thanks dude. I’m not too concerned about the copyright tag, it’s just par for the course with TH-cam.
@@PandaMoniumReviews Yeah.. That's what I hear lately. Sucks for those who put alot of effort into their content. Regardless, liked, commented, again. Keep up the great work. Cheers!
Really, at the end of the day, Sega was in a lose/lose situation that led to their downfall in the console market.
thanks 4 the video
Well as if needed an excuse to watch this masterclass again.
Sorry about the dispute man.
I can't believe I watch the whole thing.. man I felt bad for the SEGA employees back in the days..
Damn The Real Mr. Bones is so cool
I saw the last video but I’ll watch and comment again to help it out.
It’s insane to see just how bad sega was doing at this time. Between keeping the genesis on life support with goofy addons and screwing up the Saturn launch at the same time, you can really see how much of a blow this was to the whole company.
Completely unrelated but have you seen the Saturn Tomb Raider: Unfinished Business port? It looks pretty cool.
Oh boy another excuse to watch FY 1997 again.
Even more fun given Microsoft's handling of similar documents recently.
I still think Bernie should have never Osborne'd the Saturn the way he did and left SoA with no presence for a year while having Dreamcast pushed out a year earlier in Japan, the area where Saturn was doing well. Not to mention mandating the $199 launch price for the DC at the literal expense of much needed profits. (Not to mention all the cockblocked 2d and RPG games.)
Those Saturn Commercials were excellent. If I saw that Panzer Dragoon Gameplay along with an AD that had a story, I would definitely want one WAY more than the playstation.
Doing my part in getting this vid back to near 20k views, it's excellent stuff
Bones voice actor=life goals
TLDR; Its just another butterfly effect, the buyback requirement need to be agreed due to the necessity of putting Sega games in the biggest chain in US for the purpose of visibility. SOA still need to be reliant to Genesis because they also need to sold that buyback inventory, but of course generation just step forward and everyone wanted new shiny toy as their christmas presents, so just a few bought Genesis . What I didn't understand of course 32X, it just didnt make sense in both scenario I mentioned and that probably explained the dispute occured between SOJ and SOA regarding to the what inside the next gen Sega machine explained by Tom Kalinske.
So in some simplification, Sega of America killed Sega's console ambitions by refusing to let go of the 16 bit era by pushing for Genesis and 32x related peripherals while the company should have aligned and focused on making the Saturn the 5th generation powerhouse of the company.
It's a good video!
Gotta love those lofi 80s tunes.
I wish I could live in an alternate dimension where it was the PlayStation 1 that was the commercial failure and the Saturn was in steady competition with the Nintendo 64. I never liked the PS1 for many reasons; besides being a key factor in Sega leaving the console wars in 2001, they rely way too heavily on third-party support while Sega and Nintendo make their own games, and their button scheme is different from every other major console on the market. I'm not going to deny that Sega's North American and Japanese branches needed to work together as a team instead of competing against each other, and that Sega needed to focus more on the Saturn and less on the 32X, but I do feel they could have had a better chance if Sony hadn't interfered.
Just what an absolute clusterfuck of a company. And I loved the Saturn!
Awful that you got copy right stricken. Not cool.
Whoa, whoa, whoa you guys caught something very strange in one of your 1996 E3 videos. There is a quick shot of what appears to be Super Mario 64...but something is way off. In the video it shows a portrait portal inside Peaches castle. The picture inside the portrait is Wario. Technically speaking...that isn't right at all. I know this is a Sega channel (the best Sega channel) but you might consider checking it out.
For reference- The strange picture of Warrio inside Super Mario 64 happens at 15:16 in the video.
It's a reference to an old Mario 64 creepypasta to fit with the vaporwave aesthetic
Look up "Mario 64 wario apparition"
@@medes5597
I will.
Pretty sure that's a real face demo they had at e3. It's not fake. But that footage was used for the Wario creepy pasta meme stuff.
Phantastic!❤❤❤
Here's my thumbs up again, then.
One thing to note:
Even in the years Sega beat Nintendo, overall the company still was not successful. Sega profit margins actually were on a downward trend for several years prior to 1997, so it really is no surprise the Saturn failure was one of the final nails in the Sega console coffin.
The 32x was a mistake even young me didn’t see the point in it and waited for Saturn
Pandemonium, I like your video. But I think you missed something critical here.
Companies that sell at retail stores in North America are usually required by retail stores to have stock held in reserve. In case there's a spike in demand, or to be able to send extra out on a moments notice. For example, toilet paper is made in huge batches and only some are sent to retail stores. The rest are held in reserve at storage warehouses.
This applies to electronics companies too. Even if their item isn't selling, they must have a reserve stock usually as part of their contract with retailers.
Sega having extra units in their storage warehouse is normal. Nintendo and Sony have to do the same thing. They had warehouses with extra stock held in reserve. It's common practice in retail business in North America - especially when you operate at a large scale.