From Sega Retro
Sonic Team, originally known as Sega Consumer Department #3 or AM8, is best known as the main developers of the Sonic the Hedgehog franchise. The development team is one of the longest running within the company, with over 50 titles credited to them. Currently run by Takashi Iizuka, the team is still an active force both creatively and financially for Sega.
Back in 1990, Sega had one goal in mind - to create a game that would rival Super Mario Bros. and put the company on the map. The call went out internally to create a mascot character to replace Alex Kidd, who was the de-facto mascot during the Master System years. Among the many development teams who began conceiving proposals was the newly formed AM8, which included Naoto Ohshima and Yuji Naka. Having previously worked on the Phantasy Star series together, the pair set off to create the concept that would evolve into the original Sonic the Hedgehog. With Ohshima creating the title character and Naka working on the engine, Hirokazu Yasuhara was brought on to lead game development after the project was approved by the company. Through the many twists and turns of development, the game was finally set to be released, the 15-strong team dubbing themselves "Sonic Team," after the work they were proud to call their own.
With the title becoming an international success, Naka, who had grown restless with upper management at Sega of Japan, left the company only to be rehired by the Sega Technical Institute, wooed by its original head Mark Cerny. Coming to America along with Yasuhara (who had been scheduled to become a part of STI before Sonic the Hedgehog had begun development), the pair would go on to continue the main line of Sonic titles that would define the Mega Drive's library. Though no longer in the game's credits, the Sonic Team moniker would live on the Japanese packaging for Sonic the Hedgehog 2, Sonic 3, Sonic & Knuckles, and the Ohshima-led Sonic CD developed in Japan.
After the completion of Sonic & Knuckles, Yasuhara chose to remain in America, while Naka returned to Sega of Japan to become the president of AM8. Once there, he teamed back up with Ohshima, the two resurrecting the Sonic Team moniker to work on a new project that had nothing to do with their namesake, NiGHTS Into Dreams. With most members of the Japanese side of STI returning to their native land, AM8 was a far bigger team than what they had back in 1991. Among those to return was Takashi Iizuka, who had gotten his official start as a Senior Game Designer in Sonic 3 & Knuckles. With old and new blood, Sonic Team wanted their Saturn-era work to show they weren't afraid to try new ideas and concepts, as demonstrated not only by NiGHTS but their follow-up title, Burning Rangers. The only Sonic-related output was the compilation Sonic Jam, along with some supervised work on Flickies' Island and Sonic R. Though he would remain with the company until 2002, Sonic R was also the last Sonic Team-related production Yasuhara had any direct involvement with, eventually departing to work for game studio Naughty Dog.
In the twilight moments of the 32-bit era, Sonic Team decided to return to their namesake to create the first fully 3D Sonic the Hedgehog title. Though initial development began on Sega Saturn hardware, Sonic Adventure would instead become one of the flagship video games for the Sega Dreamcast, in one final bid by Sega as a whole to return to the successes they once felt in the early 90's. Met with critical acclaim, it was also the last title Ohshima worked on with the team, leaving the company to form his own gaming studio, Artoon.
Though interested in pursuing other projects but knowing the demand for further games featuring Sonic, 12 members of the team were sent back to San Francisco to form Sonic Team USA, led by Takashi Iizuka. Those that remained in Japan were directed by Yuji Naka, that team focusing on original titles such as Chu Chu Rocket, Samba De Amigo, and the return of the Phantasy Star series with Phantasy Star Online. Sonic Team USA, on the other hand, focused primarily with Sonic. Though their first official assignment was simply making sure Sonic Adventure was ready for a western release, the real reason they came into existence was made clear with 2001's Sonic Adventure 2. It was also around this time that Sonic Team began their long-term partnership with Dimps, who worked to create Sonic Pocket Adventure, and become involved in nearly every handheld Sonic title that would follow.
In April 2000, as Sega began reeling from the financial woes they hoped the Dreamcast would erase, the decision was made to have the main development departments of Sega, including Sonic Team, become semi-autonomous. Becoming Sonic Team Ltd, the group continued in earnest to create quality games. But even this corporate action and the impending release of Adventure 2 could not stop Sega from dropping out of the hardware market, Phantasy Star Online Ver. 2 becoming the last Sonic Team title released on Sega hardware in the western world.
Releasing titles on a variety of systems including the Nintendo GameCube and PlayStation 2, Sonic Team strove to still prove itself as a viable entity in the everchanging gaming landscape. Continuing to produce titles for existing franchises such as Sonic Heroes and Phantasy Star Online Episode I & II, the team still experimented with new ideas including Billy Hatcher and the Giant Egg. 2002 also saw Sonic Team's first acquisition in the form of the Puyo Puyo series, which was bought after Compile was forced to go out of business. The first game they worked on, the Arcade title Puyo Pop Fever, also became the last Sonic Team game for the Dreamcast in Japan. Continued financial woes for the whole of Sega saw yet another restructuring, with United Game Artists being merged with Sonic Team. Responsible for such titles as Space Channel 5 and the critically acclaimed Rez, the UGA staff members would continue to work together, being responsible for Feel the Magic XY/XX and The Rub Rabbits! for the Nintendo DS, and the multi-platform Sonic Riders series.
In early 2004, with rumors abounding as to the future of Sega with its ailing finances, arcade company Sammy bought a major stake in SEGA, forming Sega Sammy Holdings Inc. Shaking things up once more, the subsidiaries of Sega including Sonic Team Ltd. were merged back into the parent company. It was during this time that Sonic Team USA, now busy with the development of Shadow the Hedgehog, changed their name to Sega Studios USA. Directed by Iizuka as had been the case for the last few major Sonic titles, the game was met with less than favorable reviews.
With Sega looking to set itself back on a profitable path, the pressure for Sonic Team to create on a new generation of consoles began. At 2005's E3, Yuji Naka unveiled the initial footage for what would become Sonic the Hedgehog 2006, Sonic's first foray on a next-gen console. Though many thought Naka would assume a role in the project similar to what he had with Adventure, it was less than a year later that he announced his departure from the company. Creating his own studio Prope, Naka's new venture was completely autonomous though it did secure some financial backing from Sega. Between his announcing and actual resignation in May of 2006, Sonic Team also revealed that the previously announced Phantasy Star Universe would be ported to the Xbox 360, which became the group's first official release on the seventh generation of video game hardware.
With Naka's departure signaling the end of an era, the sudden changes in management coupled with unending pressure from the powers-that-be helped to doom the tent-pole title Sonic 2006. Meant to be a complete reinvention of the franchise, it was forced to hit shelves before it was ready, being released with much fanfare but met with just as much, if not more, disappointment.
Back in the United States, Sega Studios USA finished its final game, NiGHTS: Journey of Dreams for the Nintendo Wii. Met with mixed reviews, that, along with the failure of Sonic 2006, prompted Sega to merge the two studios back into a single entity. Returning to Japan, Takashi Iizuka was promoted to become the head of Sonic Team in 2008. With this latest shift, the development group looked to refocus their energies on their core brands, including Phantasy Star, Puyo Puyo, and Sonic the Hedgehog. 2007 saw the release of the first Mario and Sonic at the Olympic Games, a joint effort between Sonic Team, Nintendo and Sega Sports Design R&D Dept., which would become a bi-yearly series. Sonic Unleashed, released a year later, was the team's first major overhaul of the franchise since 1998, which would continue to evolve with Colours, Generations, and Sonic Lost World, attempting to preserve the core Sonic experience while experimenting with new ideas to keep things fresh.
2011 saw the team not just celebrate Sonic's 20th anniversary, but also the Puyo Puyo franchise, with the release of Puyo Puyo 7, co-developed with h.a.n.d. The following year saw Sonic Team release their largest non-Sonic title in some time, Phantasy Star Online 2, a free-to-play MMORPG that was ported to the PlayStation Vita in early 2013. Though popular in Japan, the title has yet to see a western release.