Sammy Studios Inc. is the latest video game developer to go Hollywood.
The Japanese maker of slot machines and arcade games is expected to announce today a studio in Sherman Oaks. Other game companies that in recent months have opened offices in Southern California include Electronic Arts Inc. and Konami Corp.
The company is the U.S. arm of Sammy Corp., a Tokyo-based firm that last year offered to buy game publisher Sega Corp. in an effort to enter the fast-growing $25-billion home video game market. Sammy withdrew its offer in April after it decided instead to create its own development group.
It opened a 110-person studio in Carlsbad, Calif., this summer headed by veteran game industry executive John Rowe. Sammy hopes to grow its Los Angeles operations to 100 developers over the next two years, said Steve Ackrich, general manager of the Los Angeles studio.
"This is the heart of entertainment," said Ackrich, who was vice president of product development of Atari Inc. before signing up with Sammy last week. "Three years ago, the game industry was driven by technology. Today, we're an entertainment industry."
Sammy posted a $192-million profit last year on $1.4 billion in revenue, the bulk of which came from selling slot machines in Japan. By 2006, one-third of sales are projected to come from video games and arcades, said Chief Financial Officer Richard Olafsson.
The company expects to release four titles next year.