GameDaily BIZ: So what does this expanded deal with Marvel mean from a business perspective for Sega?

Scott Steinberg: It's huge for us. I think it's an emphatic exclamation mark that Sega is in the business of building big action events, and partnering with Marvel and their new business model—which is much more tightly controlling their properties and in turn having a higher degree of success and higher quality bar as a result of that control—puts us firmly in the camp of being a licensing driven company in a lot of ways. We're looking at next summer as a big window for us with Iron Man in May and Hulk in June... It gives us a pipeline of events and big marketing opportunities, and the new Marvel business model is giving us a lot more confidence that the movies are going to be big blockbusters.

BIZ: Did you reach out to Marvel to secure this deal, or were they looking for a video game publisher to make these products? How did the deal come about?

SS: The relationship started with Iron Man, so it wasn't like all these properties landed on our laps simultaneously. We had done the negotiation for the deal with Iron Man and from that, and our working relationship with the studios and the film team, stemmed elongated conversations about the other properties and the other characters. And obviously we like working with them, they like working with us, and a more substantive agreement was byproduct of those good vibes.

BIZ: Did you have to compete with other publishers to get the rights to these other Marvel characters? Obviously Activision has produced a number of games for Marvel, so I would think they would have been interested as well.

SS: Yeah, that's a great question. If you look back these past couple years, EA's had a few dances with DC [Comics] with Batman and Superman, and Activision definitely did well with Spidey, and they've done X-Men and Fantastic Four, and Vivendi had Hulk, so there's no doubt that these are competitive negotiations. I can't speak to who else was at the table; oftentimes, in most cases we have no idea.

We don't really know who they're talking to, don't really know whether Activision says, "Hey we've got two already; we're not really sure if we want more," or if THQ wants to get into it. I can't really speak to that with authority, but I do know that these [deals] are always competitive because we've been in negotiations with other studios and have not come up with the goods on occasion. Clearly, the industry continues to look at big movies and big licenses, and comic books in particular, as a high target category, but in this instance Sega came out on top.

BIZ: Do you view this as sort of another sign of the "new" Sega? You guys have been targeting big licenses and Hollywood cross promotion more and more...

SS: Right, we're nowhere near the percentage of companies that are bigger than Sega and higher on the leaderboard; some of those companies are nearly 100 percent or 60 percent plus licensed [content] in their portfolio. It seems bigger for us because we've made a few announcements, we're playing catch up a bit, and we're boldly announcing these as they're concluding. But that will not atrophy our goals to bring out new IP and to dust off the classics that Sega has in its vault. I think that's part of our uniqueness in our positioning as a publisher, that we have this incredible heritage, and we will be bringing those out as well. You probably heard that we're bringing NiGHTS back on the Wii, and there are more of those [types of] announcements to come as well.

We've kind of got a lot of things going on simultaneously, and one does not necessarily mean we are subsuming the other. In our strategy all three really have to flow for us to be successful.

BIZ: And is there a certain percentage that Sega targets internally, where you'd like to have a certain number of original titles, a certain number of licensed titles and a certain number of new IP? How do you strike the right balance?

SS: That's a great question, James. Very insightful. We have those conversations all the time and because we are kind of birthing the new Sega in real-time, we do not have a great percentage today of licensed properties. We don't personally and professionally feel that Sega wants to be in the 100 percent kind of business of licensed properties because of the assets we have in our vault and the fact that in this new era of next-gen we feel like we can deliver new IP and hopefully build new brands. So in the next couple years you're going to see licensing becoming a bigger percentage, but you'll never see it be a majority.

They're aren't a good enough group of licenses for us to flip a switch and have all these fall out of a tree and into our portfolio. So growing organically like this requires us to be pretty measured, and you'll probably see us still be under what the EAs and the THQs and the Activisions have because our philosophy around new IP will always hold a fair amount of resources to building new characters and new properties.