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Sega and Sonic are back in the game

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Oops! In an earlier version of this post, we said Sega discontinued its Dreamcast console in 2000. In fact, it cut the cord in January 2001.

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Sega, the publisher of Super Monkey Ball and Sonic the Hedgehog, is making a comeback.

The game company, once the king of the video game hill, dropped into near oblivion after it dropped out of the console business in 2001. Its Dreamcast console suffered a humiliating defeat at the hands of Sony’s PlayStation juggernaut, and it looked as if it was game over for Sonic.

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But the blue hedgehog (pictured at right) lives on. Its publisher, Sega of America, has clawed its way back. As of May 31, Sega had snagged 4.6% of the video game software unit sales in the U.S., according to NPD Group, a market research firm. It has risen through the ranks of game publishers, from No. 9 in 2006 to No. 7 last year. Now it’s No. 6 and closing in fast on THQ, which has 5.2% of the market, according to NPD.

Sega got a boost this month from Super Monkey Ball (pictured at left), a franchise that landed on the iPhone last week. It quickly became the No. 1 most downloaded application on Apple’s App Store for iPhone software.

Up next: Sonic Chronicles, in September. Developed by BioWare, the title will mark the first time Sonic, who mostly confines himself to the action-adventure genre, appears in a role-playing game.

For those who have fond memories of the Dreamcast, Sega will be bringing back Samba De Amigo for the Wii console in September. The rhythm music game won a large and loyal following when it first came out in 1999 for the Dreamcast.

Said Sega’s new marketing chief, Sean Ratcliffe: ‘Sega is going through a renaissance.’

-- Alex Pham

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