GOODBY EXITS VIDEOGAME WAR AS BATTLES INTENSIFY;SEGA, SONY STUCK IN 32-BIT BATTLE LEADING TO DEBUT OF MUCH-HYPED NINTENDO 64

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Goodby, Silverstein & Partners has resigned its portion of the $60 million Sega of America account, just as videogame marketing heats up in anticipation of what looks to be a scorching autumn.

Mednick Group, a Culver City, Calif., agency that does print and some media buying for Sega, is producing its first broadcast campaign for the brand, and is expected to bring the famous "Sega!" scream back to TV when the creative breaks next month.

JOCKEYING FOR POSITION

The split comes amid a spring of heavy promotional marketing that's building toward an all-out war in the fall among videogame titans Sega, Nintendo and Sony, each jockeying for strategic leadership in the highly volatile $6 billion videogame industry.

Sega recently cut the price of its 32-bit Sega Saturn player by $50, opening the door for a possible price war with top rival Sony of America's $299 32-bit PlayStation machine.

This fall, Sega plans to introduce the first videogame Web browser, to be called Internet Saturn.

SONY LEADS IN U.S.

Sony's player is currently No. 1 in the market, with more than 1 million units sold vs. Sega's 500,000, though Sega claims to be the worldwide leader with 3.5 million game players sold.

Sony hasn't matched Sega's $249 price, but analysts say Sega is prepared to cut its price further.

Both marketers plan to pour on the promotional heat before Nintendo of America's much-hyped, faster, more powerful Nintendo 64 game player hits the U.S. this September, at a promised price of less than $250.

"Sony leads the way in the U.S. at the moment, and it's spent a lot of money getting there. Now Sega must try to catch up by this fall," said Lee Isgur, analyst for Jefferies & Co.

Among Sega's strategies will be re-introducing its scream at the end of TV spots for the 16-bit Sega Genesis and the 32-bit Sega Saturn, a tactic originated by Sega and San Francisco-based Goodby.

Sega discontinued the scream last year, but recent consumer research showed it was the strong-est brand identifier in the commoditylike videogame field.

"We're going to be more fun, less serious in advertising," said a Sega spokesman, who refused to elaborate on the upcoming campaign from Mednick.

SEGA SURFS NET

Ad details for Internet Saturn aren't yet available. It is a $150 add-on unit that plugs into the Saturn console and allows users to surf the Internet using the player with a TV screen.

In May, Nintendo will break two network and spot TV commercials for two key software titles for its 16-bit Super NES system-Super Mario RPG, the first role-playing games using Nintendo's famous Super Mario character, and Ken Griffey Jr.'s Winning Run. Leo Burnett USA, Chicago, handles Nintendo's estimated $60 million account.

Sony also will break new TV spots in May for games including NBA Shootout. MLB Pennant Race is another game it will promote this summer. TBWA Chiat/Day, Venice, Calif., handles Sony's estimated $50 million account.

Sony and Sega will maximize the selling window of opportunity for their 32-bit systems with heavy sampling and retail promotional tie-ins. Both are participating in road shows at beaches, concerts and sporting events.

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