Bandai buy gives Sega the edge in home technology

The home technology market could be dominated by Sega following its $1.09 billion purchase of fellow Japanese toy and electronics company Bandai.

Both companies have extensive video game, software and IT businesses. The deal will help Sega market a wider range of electronic games and characters ? for example, Bandai?s Power Rangers could be used in a Sega video game.

The acquisition is a clear warning to other computer and video game manufacturers, including Sony and Nintendo. The combined company, Sega Bandai, said the merger allows it to maintain profit margins and be more competitive, after both partners recently warned that their growth was slowing.

Bandai is set to launch Pippin, a simple games, IT and Internet device, outside Japan within months, despite poor domestic sales. Pippin is the result of Bandai?s collaboration with Apple Computer.

Nintendo will launch its 64bit console on 1 March, with an initial 20,000 machines destined for the UK market.