“Sega was a sweatshop.” When PlayStation system architect Mark Cerny looks back on his years in Sega’s Tokyo studio in the late 1980s, he doesn’t reach for nostalgia first. Instead, he describes an era of brutal hours, tiny teams, and a management obsession with sheer quantity of games as the company scrambled to catch up with Nintendo. 
Out of that pressure cooker, though, came Sonic the Hedgehog and the creative talent that would later help shape PlayStation itself.
Speaking on the My Perfect Console podcast, Cerny carefully framed his comments around a specific place and time: Sega’s Tokyo office in the second half of the 1980s. Back then, the industry was in transition. The Atari era of “one person, one game” was giving way to slightly larger teams, but not by much. At Sega, a typical cartridge project meant three people and three months to ship a commercial product: one programmer, one designer, one artist – that was it.
According to Cerny, those tiny teams were expected not only to deliver complete games, but to practically live at the office to make it happen. Developers kept spare clothes at their desks, crashed on sofas and floors, and rode out all-nighters because management believed volume was the key to survival. Former Sega president Hayao Nakayama, Cerny recalls, fixated on one metric: Nintendo’s game library.
Nintendo’s NES had roughly 40 titles available, and instead of asking how to match that quality, Nakayama reportedly asked how Sega could simply double the number. The plan for the Master System became brutally simple: flood the market. If Nintendo had 40 games, Sega would have 80. To make that happen, Tokyo teams were pushed into a relentless churn of short projects with minimal staff and almost no room for experimentation or failure.
Cerny now argues that this strategy fundamentally misunderstood how consoles are actually sold. Looking at the history of hardware successes, he points to a pattern: it’s not dozens of “okay” releases that move systems, but a small handful of truly essential games. He cites examples like Nintendogs and Brain Training on the Nintendo DS, or later the way a few killer titles on platforms like Wii – from Wii Sports to Mario Kart and Smash Bros. – carried entire consoles on their shoulders while hundreds of forgettable shovelware discs gathered dust in bargain bins.
Inside Sega’s Tokyo office, however, the culture of the late ’80s still revolved around output, not sustainability. Cerny jokes that some projects were scoped as “three people for ten months,” only for reality to stretch into “four and a half people for fourteen months” – prompting the kind of dark humour where you imagine a producer telling an employee that they only need half of them for the project. Behind the joke is a familiar story: schedules slipping, teams quietly growing, and management responding with raised voices instead of better planning.
One initiative embodied the extremes of Sega’s approach: the so-called Million Seller Project. The idea was simple but ambitious – fund a game built from the ground up to sell a million copies. That project became Sonic the Hedgehog. For once, Sega loosened its tight grip on resources, granting Sonic’s team more time and staff than usual. On paper the plan was still modest – three people for ten months – but the reality, as Cerny recalls, was closer to four and a half people over fourteen months.
The result was historic. Sonic not only gave Sega the charismatic mascot it desperately needed, but also helped the Mega Drive/Genesis define the early 1990s. Fans still debate which Sonic game is the best, but many point to Sonic 2 as the series’ peak, while Sonic 1 remains the top seller thanks in part to being bundled with the console. That success, however, came at a human cost that the sales charts don’t show.
Cerny remembers Sonic creator Yuji Naka as being yelled at constantly for blowing through schedule and budget, even as the game was transforming Sega’s fortunes. At the time of Sonic 1’s success, Cerny says, Naka was earning around $30,000 a year. Thanks to a “president’s bonus,” his best year may have doubled that to roughly $60,000 – still an astonishingly low figure for the creative mind behind Sega’s flagship franchise, especially when paired with the relentless criticism coming from above. As some fans now joke, if Sega had really understood how much Sonic meant to its future, it might have stretched that salary all the way to $65,000.
Eventually, Naka had had enough. The mismatch between responsibility, compensation, and respect pushed him to walk away from Sega Japan, paving the way for Sonic 2 to be developed largely in the United States. In hindsight, that decision reshaped the series: Sonic 2 is still widely regarded as one of the best, tightest platformers ever made, and one of the best-selling Sonic titles of all time. It’s the kind of twist that fans look back on and say that everything happened for a reason, even though it was born out of burnout and frustration rather than careful strategy.
Cerny’s memories of Sega are not all grim. He also talks fondly about his “room of forty people” in 1987, a cluster of young developers who would go on to become legends. Alongside Yuji Naka was the late Rieko Kodama, who later helped create cult favourites like Skies of Arcadia – a Dreamcast epic that, for many players, single-handedly justified buying the console, on top of Sega’s brilliant arcade ports. That cramped room in Tokyo quietly housed a generation that would influence RPGs, platformers, and hardware design for decades.
Still, there is an unavoidable sense of absurdity in how the company treated some of its brightest minds. Fans joke that Sega’s management in that era sounded more like Dr. Eggman than a modern HR department: berating staff, chasing impossible production quotas, and relying on hero developers to pull off miracles on shoestring budgets. Yet those same “miracle workers” rarely saw rewards proportional to the value they created.
For Cerny, the Sega years turned into an education in what not to do when building platforms and software ecosystems. After returning to the United States in 1991 and contributing to Sonic 2, he began the long partnership with Sony that would eventually see him become one of the key architects behind PlayStation hardware. Depending on who you ask, that makes him the quiet mastermind behind decades of console design – or, as some half-jokingly put it, the culprit who nudged Sony into the PlayStation gamble in the first place.
Looking back, Cerny’s description of Sega as a “sweatshop” doesn’t just colour one company’s past; it mirrors broader patterns across the games industry. Crunch, underpayment, and the belief that more titles automatically mean more success have all proven stubbornly hard to eradicate. Yet the story of late-’80s Sega also shows the other side of that coin: under intense, often unreasonable pressure, a handful of small teams still managed to create characters, worlds, and ideas that continue to define gaming history.
Today, as studios wrestle with questions of sustainability, unionisation, and how to value creative labour, Cerny’s memories read like both a warning and a strange origin story. Without that “sweatshop” era, Sonic might never have existed, Sega’s rivalry with Nintendo might have looked very different, and the architect of PlayStation might have taken an entirely different path. The games industry, for better and worse, is still living with the consequences of those sleepless nights in a cramped Tokyo office.