Sega's presumably accidental publication of a confidential talk with PlayStation maker Sony did more than just leak word of downloadable PS2 games for PS3--it provides a rare glimpse into the workings of the industry and the deals that determine exclusivity, what controller is in a commercial, and whose game will be displayed where at E3.

The document, which inexplicably appeared recently on Sega's Media FTP, covers a number of topics, such as Sega asking Sony for a list of "Sega IP that would work well with the motion controller"--an "easy way to differentiate the PS3 SKU."

Interoperability between PlayStation 3 and PSP games was a major focus--"think of features that would make users want to buy both PS3 and PSP SKUs," wrote Sega. In fact, "SCEA would be really interested in having [Sega] at their booth next E3" should Gearbox's upcoming Aliens: Colonial Marines somehow support such functionality.

The discussion even ventured into marketing, with Sony offering Sega cash should it "show PS3 controller on TV ads" and possibly "helping on ... Read more

Though Sony has definitively stated that PlayStation 2 backwards compatibility is "not coming back" to the PlayStation 3, an internal document that recently appeared on publisher Sega's FTP claims that Sony is preparing a "PS2 emulator for PS3."

"SCEA wants to sell all PS2 titles on PSN," reads the document, which provides notes on an August 5th meeting between Sony Computer Entertainment America and Sega.

Elsewhere in the document, it's said that Sony is considering "a special Japanese Import section (pricing $9.99 to $39.99 for full game)" for the online marketplace... Read more

The PSP-exclusive sequel to PlayStation 3 strategy-RPG Valkyria Chronicles will hit North American and European shops in summer 2010, publisher Sega has confirmed.

Set two years after the first, the sequel adds real-time controls to the mix and promises "stories of friendship, love and growing pains during a time of war and revolution."

"Valkyria Chronicles is a genuine hidden gem on PS3," said Sega marketing VP Sean Ratcliffe. "It's one of our most cherished franchises." A short trailer... Read more

Sega mascot Sonic the Hedgehog will be returning to his side-scrolling roots in 2010 with a new game codenamed Project Needlemouse on platforms unknown, GameSpot reports.

Details are sparse, with Sega brand manager Ken Ballough only noting "It's a brand new 2D adventure coming out in 2010, it's in HD."

"Old-school Sonic fans have long asked to see Sonic return to a more 2D style of gameplay," Ballough told GameSpot. "Many liked the daytime stages in Unleashed, but wanted to see a game that plays purely similar to the early games of the Genesis. Project Needlemouse is that critical first step that brings Sonic back to his 2D roots."

Click on through for the announcement trailer, with the delightful old "Se-ga!" Gensis startup sound and proud boast that "speed returns" in Needlemouse... Read more

Sega's latest countdown has ended, revealing a new Super Monkey Ball designed for the Wii Balance Board. Described as an "all-new party game," Super Monkey Ball Step & Roll brings more "monkey madness" to the Wii in early 2010, and that's about all we know.

Please install Flash to view this Shackvideo

Developer Obsidian and publisher Sega have officially confirmed that the Aliens RPG project has been canceled.

In a post on the company's official forums, noticed by Giant Bomb, Obsidian said that it was "no longer working on the game," adding that Aliens RPG is "no longer a product that is in development."

Publisher Sega--which had claimed the project was still in development as of June 15--has issued a brief statement, confirming that the project is altogether canceled.

"At this point, Sega has no plans to move forward with the Aliens RPG," said a Sega representative. "We plan to continue working with the Aliens franchise and ask fans to be patient and stay tuned for more information about what SEGA has coming out for the Aliens series of games, starting with the upcoming Alien vs. Predator game."

Rebellion's shooter sequel Aliens vs. Predator (PC, 360, PS3) is scheduled for release in early 2010. Gearbox's co-op shooter Aliens: Colonial Marines, also published by Sega, is still in development.

Though Obsidian's Aliens RPG was thought to be cancelled, Sega has confirmed that it still plans to release the title along with its other two announced Aliens games.

Asked about the Obsidian's Aliens RPG and Gearbox's Aliens: Colonial Marines at E3, Sega told Joystiq that it will have "have more news to share about the other two games in the near future so stay tuned," adding that "[Rebellion's] Aliens vs. Predator will be the first to ship out of our triplet of Aliens titles; hence it was shown at this year's E3."

In addition, Gearbox president Randy Pitchford confirmed to Kotaku that a Nintendo DS edition of Aliens: Colonial Marines will hit alongside the PC, PlayStation 3 and Xbox 360 versions of the cooperative shooter. However, Gearbox is not handling the DS edition.

Supposed footage from Aliens: Colonial Marines DS (viewable below) leaked before E3, with Contra 4 and Shantae veteran WayForward then pinned as the... Read more

The bulk of the second "SEGA Vintage Collection" arrived in the Xbox Live Arcade today, offering six classic SEGA games--Gunstar Heroes, Altered Beast, Shinobi, Comix Zone, Phantasy Star 2 and Sonic the Hedgehog 3--at 400 Microsoft Points ($5) a pop.

Each has been updated with support for high definition displays and leaderboards, with Gunstar Heroes, Altered Beast and Sonic 3 also getting online multiplayer.

Excluding Gunstar Heroes, the remaining five games can also be found on the PlayStation 3 and Xbox 360 retail compilation Sonic's Ultimate Genesis Collection, though the versions found in that bundle don't pack online multiplayer.

While most of the downloads are exclusive to Xbox 360, with Ultimate Genesis Collection reject Sonic & Knuckles due later in the summer, Gunstar Heroes will also be making its way to the PlayStation 3 through tomorrow's PlayStation Store update.

Six of the seven downloadable and enhanced classic old-school titles Sega is bringing to the Xbox 360 will arrive on June 10, the company announced today, with the PlayStation 3 re-release of Gunstar Heroes due out the next day, on June 11.

Arriving under the "SEGA Vintage Collection 2" banner, each game will be sold separately at an as-yet-unknown price point, and has been updated to support high definition visuals, online leaderboards, and, if applicable, online play.

While Gunstar Heroes will hit both Xbox 360 and PlayStation 3, it appears as if the rest of the titles--Altered Beast, Shinobi, Comix Zone, Phantasy Star 2, Sonic the Hedgehog 3--are currently exclusive to the Xbox Live Arcade, with the final... Read more

Following the successful mashup of Sega Superstars Tennis, the various beloved characters of Sega's rich and diverse gaming history will once again be facing off against each other early next year, this time in a Mario Kart-esque battle racer.

Coming to PlayStation 3, Xbox 360, Wii and Nintendo DS, Sonic & SEGA All-Stars Racing--conceivably the spiritual sequel to the oft-forgotten Sonic Drift series--will allow for four-player offline races and online matches for up to eight competitors.

"Its huge variety of characters and vehicles, plus the ability to play both online and off set it apart from other games of this type," marketing director Gary... Read more

Look out! Wild freaking animals are coming to Wii and Nintendo DS later this year, as Sega is resurrecting an updating its old arcade animal herding game Jambo! Safari.

As players drive through the African savanna, they'll be tasked with everything from diagnosing sick animals to taking pictures to lassoing to hot air balloon rides. Of course, Sega vowed that those playing on Wii can swing the Wii Remote "like a lasso."

The Wii edition will also sport various four-person multiplayer modes, along with two player co-op and the ability to customize both your ranger and their respective vehicle. Meanwhile, the DS version is said to "make full use of the stylus and double screens."

Titled Jambo! Safari Ranger Adventure on the Wii and Jambo! Safari Animal Rescue for the Nintendo DS, both games are slated to arrive in the nebulous late 2009 window.

More classic titles from publisher Sega will be updated and released via PlayStation Network and Xbox Live Arcade this summer, the company announced today. The downloadable games will be sold individually, with each release being "re-worked for high definition," supporting leaderboards, and, if applicable, sporting online play.

The overall compilation is dubbed the "SEGA Vintage Collection 2." Oddly, the announcement stated that the collection would hit both PS3 and Xbox 360 this summer, though listings only show Gunstar Heroes hitting both. Details and screens follow:

Gunstar Heroes (XBLA & PSN) - Summer 2009 / Online Play

"The classic side scrolling shooter from the SEGA Genesis returns to captivate fans new and old with its non-stop action and cooperative play."

Altered Beast (XBLA) - Summer 2009 / Online Play... Read more

Not content with Mario & Sonic at the Olympic Games for Wii and Nintendo DS, Sega has revealed Vancouver 2010 - the Official Video Game of the Olympic Winter Games. Due out on PC, PlayStation 3 and Xbox 360 in the winter of 2010, presumably before the with the 2010 Olympic Winter Games kick off in Vancouver, Canada on February 12.

Hugh Binns, director of developer Eurocom, promised that the compilation of various Olympic events will "set a new standard for the Olympic-themed video games genre."

Please install Flash to view this Shackvideo

Shackvideo users can use the HD Stream.

Rumors that publisher Sega has canned Obsidian's long-in-development Aliens RPG have apparently been confirmed by former Obsidian designer David Kondor.

Kondor's LinkedIn lists him as a "designer for canceled third-person action Aliens RPG" at Obsidian from April 2008 to February 2009, as noticed by Strategy Infromer.

Obsidian's Aliens RPG was first announced way back in 2006, with few updates from the studio or publisher since. Rumors of its cancellation surfaced in early February.

Sega and Obsidian have yet to officially address the rumors, which also specify staff cuts at Obsidian and suggest Sega is "reviewing" Gearbox's cooperative Aliens shooter.

Earlier this year, Sega announced a new Aliens game by Rebellion, Aliens vs. Predator, noting that the new game would arrive before any of the publisher's other Aliens games. However, the Aliens RPG and Aliens: Colonial Marines weren't mentioned by name.

Update: On top of the previous report, Joystiq's sources claim Sega has stopped funding both the Aliens RPG and Aliens: Colonial Marines. Obsidian's layoffs are also said to have affected the team for Alpha Protocol, which Sega is publishing this year.

Original: Sega has reportedly cancelled the Aliens role-playing game that was being worked on at Knights of the Old Republic II and Alpha Protocol developer Obsidian.

The RPG was announced in 2006, but little has surfaced since. The cancellation resulted in more than 20 employees being laid off, according to Kotaku's sources.

Sega is also said to be "reviewing" Gearbox's shooter Aliens: Colonial Marines, leaving its fate unclear. Rumors that the game was put on hold emerged amidst November layoffs at Gearbox, but the studio quickly stated that the game was not "canned."

The publisher announced a new Aliens game, Aliens vs. Predator, just yesterday. Sega said that AvP would arrive in 2010 before the other Aliens games under development, but did not specifically mention the Aliens RPG or Aliens: Colonial Marines by name.

Earlier this week, Sega vowed it would cut research and development costs by 20% after revising its financial projections to account for an expected loss of $236.9 million.

Following the ridiculously successful Mario & Sonic at the Olympic Games, which has sold over 10 million units since it debuted on Wii and DS before the 2008 Summer Olympics, Sega has announced that the duo are now headed off to the Winter Olympics.

Developed by Sega of Japan with the involvement of Mario creator Shigeru Miyamoto, Mario & Sonic at the Olympic Winter Games will offer Wii and Nintendo DS owners numerous Olympic-themed mini-games, such as Alpine Skiing and Speed Skating.

Please install Flash to view this Shackvideo

Said to bring "new faces to the series," the game will also support the Wii Balance Board in some activities, which Sega claims will result in a more realistic experience.

Sonic & Mario at the Olympic Winter Games is due out in late 2009, with the 2010 Olympic Winter Games slated to kick off in Vancouver, Canada on February 12.

A new Aliens vs. Predator game will arrive in early 2010, publisher Sega has announced, with the company noting that AvP will hit before its other two Aliens games.

That means Gearbox's shooter Aliens: Colonial Marines (PC, PS3, 360) and Obsidian's Aliens RPG won't debut until 2010, at the very earliest. Colonial Marines was originally expected last year, and was recently listed as a Q1 2009 release by Sega Europe.

Rumors that Aliens: Colonial Marines was put on hold emerged amidst layoffs, but Gearbox president Randy Pitchford quickly clarified that it wasn't cancelled. Meanwhile, Sega has remained rather quiet about the Aliens RPG since it was revealed in 2006.

The new Aliens vs. Predator title will be developed by Rebellion, which handled the 1999 PC shooter Aliens versus Predator, but had no involvement in Monolith's 2001 sequel.

No further details or platforms for Aliens vs. Predator were provided, apart from a promise it will be "innovative," with Sega vowing that more details are due "very soon."

Noting that it has "failed to swiftly respond to sharp changes in the business conditions," Sega has announced that it is soliciting applications for 560 employees, roughly 18% of its workforce, to retire by the end of its fiscal year on March 31, 2009.

Assuming the company meets its proposed quota, it expects to save roughly $55.1 million on labor costs across its next fiscal year. The studio will also close or sell 110 amusement facilities, and reduce its research and development costs by about 20%.

At present, the Japanese video game publisher and developer expects to post a net loss of $236.9 million for the fiscal year, instead of its previously expected $55.1 million profit. That means its expectations are down a total of $292 million, roughly 530%.

The company cited weaker-than-expected Japanese video game sales and the weak yen-dollar exchange rate as factors in its lowering is projection.

Despite the lowered expectations, the current fiscal year is still an improvement over Sega's last fiscal year, in which the company saw a net loss of $577.4 million.

In 2006, Sonic the Hedgehog creator Yuji Naka formed a new studio named Prope. In late 2008, Prope released its first game, Let's Tap, in Japan. Today, Sega announced that the unique Wii game will make its way to North America this summer.

Played without actually holding the Wii Remote, Let's Tap instructs players to place the Wii Remote on a flat surface, and then smack that surface to "play." Really. Five game modes are available, each with multiple levels and support for up to four players.

Tap Runner is a racing challenge similar to Donkey Kong Jungle Beat, Visualizer transforms taps into fireworks and paint strokes, Silent Blocks is essentially Jenga, Bubble Voyager is a space shooter, and Rhythm Tap has players tapping timed beats.

Please install Flash to view this Shackvideo

In a terse announcement today, Sega revealed that it is preparing a multi-platform video game tie-in for the upcoming Iron Man 2 film.

Development of the game is underway at Sega Studios San Francisco, previously known as Secret Level, which worked with A2M on last year's critically-panned Iron Man video game.

Specific platforms and gameplay details were not provided, with Sega only noting that "players can expect an entirely new and enhanced gameplay experience" due to a refined engine.

The game is expected to arrive alongside the Robert Downey Jr.-starring film in 2010.