It's always sad whenever a game development house closes its doors, much more so when you realize that said game development house didn't have quite enough time to prove itself. Such is the case with Sega Racing Studio, a branch of Sega that opened in 2005, and now closing this year. That's three years worth of work, and with just Sega Rally Revo (PS3, Xbox 360, PC, PSP) on their list of accomplishments. Ouch.

So why is Sega closing down Sega Racing Studio? After all, it's the branch that looked as if it would revive Sega's hold on the racing genre. A company rep's official stand on the matter tells us why:

Regrettably Sega today announced that it is to commence consultation regarding the unfortunate closure of the Sega Racing Studio in Birmingham, UK.

The decision is part of a review of Sega's Western Development Studios to ensure that each studio is a profitable entity in its own right, and unfortunately the Sega Racing Studio’s 5 year plan would not result in a successful return for the Sega business moving forward. Sega would like to stress that there will be no changes within their other internal development studios.

Well, that explains it. To give it to Sega Racing Studio, Sega Rally Revo was quite the solid racing title - it's a shame that Sega saw fit to close its doors before the branch could follow up on the success. Here's hoping that we don't hear about any more game development houses being shut down.