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Chapter 7 - Chapter 7: The Publishing Share is Way Too Low

The Sega publishing department had its own separate office area, dedicated to handling game releases for Sega's home consoles. But since the home console was still a new venture, the publishing work for this department was relatively light.

Kobayashi Tetsu had changed into a relatively formal suit, with the top button fastened neatly.

At this moment, he stood outside the publishing department with Kentaro in hand, holding a self-soldered cartridge.

It was impossible to say he wasn't nervous. Without inside connections, he wouldn't even be standing here; he might have been brushed off by a regular staff member—possibly without even getting a face-to-face meeting.

Kentaro repeated his instructions: "The acting manager in charge of home console publishing is Minoru Tanaka. When you meet him, address him as Manager Tanaka. Remember what I told you—don't be humble! The more humble you are, the more easily you'll be dismissed. Go in and make a bold impression immediately, so Tanaka will personally handle your game's release. If it goes to his subordinates, the game's in danger."

Kobayashi Tetsu nodded.

He was ready to figuratively slap Tanaka as soon as he entered. Of course, this was just a joking thought.

But Kentaro turned serious in an instant.

"If necessary, a slap isn't off-limits. As long as it works, the method doesn't matter. What matters is the result!"

Tetsu inhaled sharply. That was a bit intimidating!

Kentaro continued: "Tanaka is in the faction of the president."

Tetsu quickly ran through it in his mind.

The current Sega president should be Nakayama Hayao. The president isn't the same as the company chairman; he doesn't hold real power, more like a retired emperor. After Sega's ownership changed, the board appointed Nakayama as chairman, but he eventually won the internal power struggle and became president, taking control.

Tetsu thought, "Then… Dad, you're also…"

"Shh, don't say that. I was brought back from the U.S., I don't get involved in headquarters matters."

Kentaro patted his shoulder casually. "Let's go. Make an impression—I'm right behind you."

Tetsu understood. Kentaro was also in Nakayama Hayao's faction, which simplified matters considerably.

Tetsu knocked and entered. Behind a wide desk, a man with a crescent-shaped bald head was bent over, scribbling. He was forty but had the hairstyle of someone sixty.

Tetsu thought he might be working on some data. But as he got closer, he realized the man was doing a crossword puzzle.

Tanaka Minoru held a magnifying glass over the page, mumbling: "Los Angeles, York City, then…"

Tetsu shook his head and leaned closer.

"Then it should be San Francisco," Tetsu said.

Tanaka suddenly looked up—but his first glance went to Kentaro behind Tetsu. Kentaro gave a slight nod in silent approval.

Only then did Tanaka turn to Tetsu. "Continue."

Tetsu continued: "San Francisco, Las Vegas, Guantanamo, then… Arizona." He quickly filled in the squares with his pencil.

"Hmm," Tanaka set down his magnifying glass, half-smiling. "How are you so sure?"

"Because the clues say they're U.S. locations," Tetsu shrugged. "It's a U.S. crossword, and I've just returned from America."

"I've heard of that," Tanaka glanced at Kentaro again, who firmly redirected his gaze back to Tetsu. Tanaka then lowered his eyes.

"You're not here to ruin my crossword, are you?"

"No, actually…" Tetsu started to speak politely, but Kentaro suddenly coughed twice.

Tetsu looked up immediately. Right—he needed to be bold, make an impression.

Suppressing the urge to slap Tanaka or touch his bald head, Tetsu took a deep breath.

"I made a game."

Tanaka nodded.

Kentaro frowned.

"I hope Sega can publish this game."

Tanaka still nodded, expression calm, betraying little emotion.

Kentaro stood, then sat back down.

Tetsu added, "This game can save Sega from the FC."

"Oh…"

Tanaka leaned slightly closer, almost right in front of Tetsu.

"Kid, boasting isn't a good habit."

"I'm just stating a fact, an undeniable truth," Tetsu said. "Like a crossword—though there may seem to be countless answers, there's only one correct choice. You, as the publishing manager, know the FC's sales better than I do. Though it started with simple playing cards, clearly Nintendo is better at making games."

Tanaka's expression melted into a chuckle, yet he still looked at Kentaro.

"Tetsu, you've taught him well."

"I never taught him anything," Kentaro coughed twice. "This is between you two; I'm just the intermediary."

"One side is the acting home console manager, coming with his teenage son to negotiate; the other is the Sega software department and outsourced projects. Hard to choose," Tanaka said.

Tetsu nodded. "Indeed, I can't find a reason to choose them."

Tanaka chuckled but didn't refuse. He picked up the phone.

"Hello… Publishing Department, Tanaka Minoru. Send me a TV and an SG1000, as soon as possible."

Soon, a staff member delivered the equipment. Kentaro accepted the surprised stares calmly, sitting unflinchingly.

Tetsu took out the cartridge.

"This game is called 'Kobayashi Blocks.' The controls are simple, the gameplay straightforward."

He explained the rules and inserted the cartridge. Over the past few days, he had optimized the visuals—rearranging the interface, coloring the blocks, adding a start screen. With only 1KB of storage, this allowed a few hundred words of content.

When the Tetris screen appeared, Tanaka's expression barely changed. The graphics weren't impressive—colors were already common—but the quality of a game isn't just in the visuals.

The game began. As the blocks descended, Tanaka remained unusually calm but started moving the pieces.

When he cleared the first line, Tetsu noticed an expression on Tanaka's face similar to Kentaro's.

"Interesting."

Tanaka's eyes stayed on the screen, but he quickly asked a few questions:

Tanaka: "Why is it called Kobayashi Blocks?"

Tetsu: "Because I'm Kobayashi."

Tanaka: "Can it be Sega Blocks?"

Tetsu: "Depends on the publishing. If the money's enough, maybe."

Tanaka: "Did you consider controls during development?"

Tetsu: "Yes. The joystick seems easy but isn't. Controls must be simple."

Tanaka: "The title screen takes up a lot of space."

Tetsu: "Not really—it's made of sprites, just many I-shaped blocks."

Tanaka: "You understand sprites?"

Tetsu: "Of course, for game development."

Tanaka: "Can all blocks rotate?"

Tetsu: "No, O cannot rotate. I defined rotation commands for others; O has no difference, saving space."

On screen, Tanaka completed three lines and earned five points. He pressed pause, staring at Tetsu. Well done.

Suddenly, Tanaka said: "10%."

Tetsu blinked. "10%?"

Tanaka explained: "10% of sales revenue."

Tetsu hissed. From what he knew, later platforms like Steam take 30%, sometimes more. Overly greedy platforms might take 90%. Most platforms are between 30–50%. But in this offline era, a 30% cut is impossible—real profit margins were low. According to Sega's 1984 report, profit was about 17%.

So 10% meant, if Tetsu earned all $210 million revenue, he'd share it with Sega 10:7.

Tetsu looked at Kentaro, unsure if it was fair. Kentaro nodded.

"Alright," Tetsu said, extending his hand. "Pleasure working with you."

From Tanaka came a slightly mocking but playful sound: "Such a child… but formal. Pleasure working with you."

They shook hands. Tanaka added: "But don't get too happy. Only written agreements count; verbal ones can be voided. 10% or 50%, if not in the contract, can be torn up anytime. But you know that. I will personally handle the publishing of this game."

Tetsu left the office feeling unexpectedly exhausted.

Kentaro patted his shoulder: "How's it feel?"

"Hard to say. Seems tough to deal with."

"Of course. If he were easy, he wouldn't be manager. He kept looking at me—he probably thought I made the game, hence all the questions."

"But I answered everything," Tetsu said.

"Correct, fast and precise. Those questions confirmed the game was really yours."

Tetsu hesitated: "But 10% seems low."

"Not really. Usually, Sega gives developers 5–8%. 10%+ is an internal reward. Contracts cover revenue share. You can think of this 10% as equivalent to 50%."

Kentaro patiently explained: "Other companies may promise high cuts, but after platform cuts and overseas distribution, the real share may be tiny. Selling yourself is risky—unauthorized cartridges burn machines. Large companies guarantee proper distribution and scale. 100% is only possible if you do all the work yourself, but then profit is minimal."

"Register a studio under Sega, for banking purposes only. Name it something nice, and keep the profits."

Tetsu grinned.

"Don't regret it, Dad. You'll make a lot."

Kentaro grabbed Tetsu by the neck playfully: "Even if you make a billion, I won't regret it. We have Sega shares. When I'm old, I'll transfer them to you. Now think of a name for the studio."

"Uh… Atlas?" Tetsu suggested.

"Atlas, the god holding up the earth in mythology," Kentaro said, impressed. A perfect name—one that could carry Sega's heavy fate.

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