The Second Party War (5)
“I understand you made an appointment, but may I ask what brings you here?”
At Maruoka’s question, Fujita, the sales manager of Nintendo, adjusted his round glasses politely and gave a slight bow. “Yes, it’s nothing other than a request for Namco to develop games for the Famicom.”
With his square-cut hair and slightly tanned skin, paired with those round glasses, Fujita didn’t exactly have a polished look, but he possessed a strange, approachable charm. Maruoka, however, seemed unimpressed, reacting with a flat expression.
“You want us to make games for the Famicom…?”
“That’s correct. Until now, companies have been free to make games for consoles as they pleased, but from now on, Nintendo intends to manage the process directly.”
“Hmm….”
Both men were remarkably nonchalant. Maruoka had already established the concept of a Third Party through his conversations with Yoon-gi, and Fujita, having gathered information from various sources under Nintendo’s instructions, was well aware of the licensing concept Yoon-gi was trying to implement. Yet, neither of them brought it up, and they both played dumb, causing the conversation to run in parallel lines. Of course, Fujita tried to change the angle to lure Namco in, but Maruoka intentionally mirrored those angles, keeping the conversation at a stalemate.
“If Namco were to make a game for the Famicom, would we be allowed to port it to other consoles?”
At Maruoka’s question, Fujita shook his head. “No. We want games exclusive to the Famicom.”
“Hmm, then what can Nintendo do for us?”
“Naturally, we will offer you preferential treatment regarding Royalties.”
“Hmm….”
Royalties were a crucial proposal, but Maruoka’s lukewarm reaction left Fujita feeling like he was burning up inside. “Is there perhaps something else you desire?”
Maruoka shook his head at the question. “No. It’s not that I want anything in particular, but even with preferential royalties, I doubt it would cover the losses incurred by exclusive supply.”
“Of course it will. You know Nintendo’s potential, don’t you?”
“But isn’t the Famicom currently struggling due to the Recall? I don’t see why we should take that risk….”
“Not at all. We are quickly fixing the button issues and other problems that were raised. Once we re-release it soon, it will undoubtedly become an attractive market.”
“Hmm… if that’s the case….”
“Then, will you accept our proposal?”
“You mean the preferential royalty offer?”
“That’s right.”
“How much of a preference are we talking about?”
“It hasn’t been precisely decided internally yet, but the difference compared to those who don’t receive it is roughly….”
Maruoka nodded as he listened to Fujita. “I understand. However, this isn’t a matter I can decide on my own. May I report this to my superiors and get back to you?”
“Is that really necessary? It seems like a matter you, as a Director, could decide sufficiently.”
“Oh, that’s impossible. I’m not the only Director here.”
Fujita wanted to pull the contract out of his bag right then and there, but Maruoka, as if he had coated his body in sesame oil, politely and repeatedly declined Fujita’s requests. In the end, Fujita had no choice but to leave with a plea for a favorable answer. As soon as Fujita left, Maruoka crossed his legs and let out a sigh.
“To think they came with a proposal based solely on royalties. Does Nintendo have no idea what kind of offer Sega has made?”
The offer Yoon-gi had told him about. It was, in fact, an incredible proposal that had even caught Nakayama off guard.
Two days before Fujita visited Namco, Nakayama had heard an astonishing proposal from Yoon-gi.
“Pardon? You want to subsidize part of the development costs if a game fails to be a hit?”
At Nakayama’s shocked reaction, Yoon-gi smiled and nodded. “Yes.”
“That’s absurd. If we do that, developers will just make games half-heartedly.”
For Nakayama, a businessman from the 80s, this reaction was only natural. In this era, the concept of subsidizing development costs was unheard of. This logic, when viewed as an ‘external expression of opinion,’ is even used in the 2010s.
However, this method of subsidizing development costs is actually used in the 2010s. Of course, Yoon-gi didn’t make the proposal because he knew this fact. He arrived at this idea through the algorithm in his head. Yoon-gi began to explain this algorithm to Nakayama.
“If it’s just about royalties, there’s a possibility we’ll be pushed aside if Nintendo offers better conditions. Don’t you agree?”
“That… is true. But didn’t we promise them priority on parts?”
“Priority on parts has its limits. The number of parts going into the Genesis is finite and not very large. What should we do if the number of companies joining as Second Parties increases?”
“That is….”
Nakayama had no sharp answer, so he naturally had to shut his mouth.
“In the end, it means we can’t attract them as Second Parties with just simple royalties or parts priority.”
“I agree with that, for now.”
“And think about it carefully. The fact that we grant the license means we are the ones doing the inspections.”
“That… is true…?”
“So we can just set conditions. Tell them to submit an Alpha Version to us. We can subsidize them if the Alpha version, which is at least playable, passes our inspection. If we try it and it’s fun, wouldn’t it sell well in most cases?”
“Hmm… it certainly seems like a way to increase reliability.”
“Yes. It might not be 100 percent, but at least it can reduce the risk. If we use this method, developers will develop according to Sega’s standards to receive at least partial compensation for development costs, and this will lead to an improvement in the quality of the standards.”
“Subsidizing development costs… I’ll bring this agenda to the board of directors.”
“Pass it no matter what. If this agenda doesn’t pass, I’ll use a different method.”
“A different method?”
“I’ll let you know if it gets blocked.”
In a sense, it was expected, but Yoon-gi’s agenda failed to pass the board.
Forced implementation. The method Yoon-gi brought out was none other than pushing it through. Since Nakayama was already in the same boat as Yoon-gi, he forced the agenda that had been rejected by the board using his authority as President, and as a result, this fact was definitively conveyed to the Second Parties Yoon-gi had recruited. If it had previously been at the level of ‘this is what it will be,’ now it was a firm commitment. As a result, practical contact with the Second Parties began, but the board of directors was in absolute chaos.
However, not all directors were like this. Yoon-gi was currently the major shareholder of Sega. Furthermore, since the subsidization of development costs and the dismissal of Nakayama were completely different issues, there was intense debate among the directors. But just because there was debate didn’t mean Nakayama was in a safe situation. A director had his opinion ignored. What could he do in such a situation? That was to sell his shares. Some directors didn’t sell through the stock market, but instead approached Nintendo, expressing their desire to sell their shares to them. Naturally, Nintendo, which was very interested in the Genesis project, welcomed it with open arms, and the directors and Nintendo began negotiating the price of the shares. It was the second day since those negotiations began. February in Japan was warm, but Nakayama was shivering, stamping his feet toward Yoon-gi.
“Yoon, we’re in big trouble. If the shares pass to Nintendo, they could put the brakes on the Genesis project itself.”
However, unlike Nakayama, Yoon-gi’s expression remained calm.
“President.”
“Yes…?”
“Calm your excitement and use your specialty.”
Nakayama caught his breath for a moment and pondered what Yoon-gi was talking about. And feeling strangely refreshed, he asked Yoon-gi.
“Have you made some arrangements?”
“Of course.”
Yoon-gi felt as if he could hear Choi Deok-bae’s voice in his ear.
"Don't worry, the trap is already set."
⟨ Choi Deok-bae's Guidance ⟩
“Three percent? If you think you’re going to sell for such a measly condition, I wouldn’t have even made contact in the first place. You’re aware of the potential value of Sega’s shares, aren’t you?”
At the director’s stiff expression, the Nintendo staff looked troubled.
“The Genesis project may have started, but it’s not a successful project. How many projects have many companies launched with high hopes until now? But most of them failed. Just looking at that, aren’t you placing too much value on the Genesis project?”
“You know it’s not just because of the value of the Genesis project, don’t you? The reason we’re trying to hand over our shares to Nintendo. Are you really going to pretend you don’t know?”
At the director’s sharp point, a bead of sweat began to form on the staff’s sideburns.
“Hahaha… how could I not know that? But even so, the 40 percent you proposed is too excessive.”
“And the 3 percent you proposed is an equally absurd figure.”
In the end, the directors and Nintendo staff were struggling with negotiations due to the price, but this fact was not outwardly known to Sega. Because this was, after all, a secret meeting. However, their conversations were being clearly grasped by Choi Deok-bae. Choi Deok-bae, clicking his tongue, positioned Johnson and Ggubeongi, and returned to Yoon-gi’s side.
“Aren’t you working?” At Yoon-gi’s joke, Choi Deok-bae frowned.
“It’s a joke. I’ve set a table for you, so eat.”
At Yoon-gi’s light bow, Choi Deok-bae brightened up and took his seat in front of the table.
“Sometimes there should be days like this. By the way, isn’t it enough to just leave Johnson there?”
“I remember you saying last time that it wasn’t easy to secure information through Ggubeongi’s sight or hearing. Has it gotten any better?”
Choi Deok-bae shook his head. Ggubeongi. Choi Deok-bae called Lee Jae-seo, the son of the ghost Kim Ryeon, Ggubeongi, and Yoon-gi had been influenced by that and called him the same. Of course, it wasn’t a negative meaning, but rather a nickname filled with a kind of affection? However, true to his nickname, Ggubeongi was definitely clumsy. If Johnson could be controlled as easily as if Choi Deok-bae were seeing and hearing with his own eyes and ears, Ggubeongi’s sight or hearing only provided less than 10 percent of the information Johnson did. However, Choi Deok-bae had sent Ggubeongi along with Johnson wherever he went, hoping that Ggubeongi might have some special ability like Johnson. Of course, it was Johnson who played an active role in the secret meeting between the directors and Nintendo staff, and Yoon-gi finally began to move his body on the second week since contact began, according to the information Choi Deok-bae provided.
The directors finally decided to hand over their shares to Nintendo with a 15 percent premium. Nintendo’s persuasion that giving too much of a premium could attract government surveillance had worked, but from the directors’ perspective, it was honestly a situation where they couldn’t help but feel a bit of regret.
‘Should I ask them to raise it by even 1 percent before signing tomorrow?’
Kitamura Keitaro, one of Sega’s directors, thought this as he parked his car in front of his house and stepped out.
“Are you Mr. Kitamura Keitaro?”
A dark night. A voice suddenly heard. There was only one thing Kitamura could do.
“Aaaah!!”