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While the Master System was technically superior to the NES, it failed to capture market share in North America and Japan due to highly aggressive strategies by Nintendo and ineffective marketing by Tonka, who marketed the console on behalf of SEGA in the United States.

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Sega's North American division, Sega of America, is headquartered in Irvine, California, having moved from San Francisco in 2015.

This company eventually became Rosen Enterprises, and in 1957, began importing coin-operated games to Japan. A few days later, on June 3, two new companies were established to take over its business activities, Nihon Goraku Bussan and Nihon Kikai Seizo.