Sega have today announced the radical shift in business plans they have been hinting at since October last year. Sega will team up with British-based PACE Micro Technology, PLC, the leading company in the set-top-box industry, to develop a home gateway product using Dreamcast technology. The product will be introduced to the public by PACE at roadshows, scheduled to take place in Britain and the USA at the end of this month.

The set-top-box will incorporate network connectivity as the main feature of the Dreamcast, enabling access to what it describes as "diverse markets outside the gaming industry." Users with a broadband connection (xDSL, CATV, satellite and so on) will be able to watch television and other subscription-based channels, play games, use the Internet and more using a single box. The product moves Sega away from console-dependant business for the first time.