At least they are according to this webpage.

http://games.thedgn.com/index.php?page=news/EpVFuyZFEyghGcrhra.php

I have no clue how reliable that site is, but if it' s true.... good. At first I was a little dishearted, then I remembered all the worthless development teams that don' t do too much.

Sega used to be the king of the arcade... but arcades are vanishing everywhere... So cut your arcade division. A development team not pulling it' s weight... cut them too.

I' d much rather see Sega with 4-5 strong development teams than a few good development teams and a lot of average ones.

It' s true. They' re cutting between 100-200 staff from their development teams of about 1,000. A good move if you ask me as it' s currently well bloated. See here for more details: http://games.kikizo.com/news/200305/050.asp

i remember Sega of Japan had a Lawsuit a few years back for boring their staff till they quit, thus saving on the benifits they would have to give out. It backfired very badly though.