Sega has announced that the company is slashing its income projections by almost 50% from ¥38 billion to only¥18 billion. This will result in the Japanese corporation streamlining its Western operations, which means cutting jobs and cancelling some of its titles.
According to Sega, "Consumer Business centered on SEGA Corporation is expected to post operating loss in the year ending March 2012, due to the challenging economic climate and significant changes in the home video game software market environment in the U.S. and Europe. It is essential to streamline organizations in the field of home video game software in the U.S. and European markets, while shifting to a structure that corresponds to change in environment, including strengthening development in the field of digital content."
Part of the streamlining of operations in North America and Europe means that the company will be focusing on strengthening its digital content.
Sega has sort of admitted failure in attempting to appeal to a Western audience as well, and sticking with IPs that are "proven", such as Sonic the Hedgehog, Total War, Aliens and Football Manager.
Sega hasn't specified which titles will be cancelled, but it seems that with the failure of such original IP games as Binary Domain, Sega's attempt at a Western-styled third-person shooter, to sell has made the company gun-shy about trying to create original IPs in Western-dominant genres.