After a highly well known site revealed that Sega would re-enter the console race, we got in touch with Sega.  A Representative told us "We were planning to re-enter the console race, but Microsoft decided it would be safer to buy us than compete with us.  As such, we no longer have any plans to release a new console, and will reveal 122 Xbox 2 exclusive games at E3 2004."

A high ranking Microsoft Official, who requested not to be named told us "Yes, its true.  I authorised the transaction myself during mid morning tea."