Showing posts with label New York Times. Show all posts
Showing posts with label New York Times. Show all posts

When Nintendo Bought Sega: How A Simple Misunderstanding Caused Stock Market Chaos

In a recent post here at the Junkyard, we looked briefly at a news story that occurred in late 2000, and which eventually lead to both Sega and Nintendo suffering financial losses. What's interesting, is that at the time the story didn't really generate that much interest outside of the gaming press; but if it happened today, the 'fake news' epidemic which is currently gripping mainstream media would no doubt have propelled this particular tale into the stratosphere.
The Dreamcast Junkyard is, first and foremost a blog which exists simply to celebrate the highs and the lows of the Dreamcast; the Dreamcast's history and the contemporary scene which appreciates the wonders of Sega's little box of tricks in the present day. Politics is not something we wish to bring into the mix...however, one cannot escape the fact that over in the United States, the accusations of President Trump levelled against the media for the proliferation of 'fake news' has reached fever pitch. There are comparisons which can be drawn to this tale from the turn of the century, but I'm not one for over dramatics - it's pretty much just games and an honest misunderstanding at heart. But still, it's an interesting story and parallels can be drawn...so lets get on with it.
On the 27th December 2000, the New York Times ran a story which reported that a merger between Nintendo and Sega was imminent. Or rather, that Nintendo was in advanced talks to purchase its rival for a figure in the region of $2 billion. While you may be forgiven for shrugging and thinking "so what?" it's worth remembering that back in 2000 Sega was still in the hardware business. The Dreamcast was still on store shelves and according to various reports Christmas 2000 was a healthy one for Sega and the Dreamcast - in the UK at least, the Dreamcast was the number one console in sales terms over the festive period.

The reason this particular story is of interest is due to the ramifications it had, the way in which the media reacted to such explosive news and ultimately the explanation as to how a simple misunderstanding lead to Nintendo having 4% of its market worth wiped out in a single day.