Toy Fair 2015: Interview with Leapfrog's Tom Kalinske - SEGA, Mattel, Console Wars

[00:00:00] Michael Artis: Welcome back to your live continuing coverage of Toy Fair 2015. This is your official Toy Fair coverage with the Toy Industry Association. I'm Michael Artis, and you're watching Be Terrific. Thanks so much for joining us. Don't forget you can join our chat room. You're going to want to do it for this one. I mean, this is an exciting one. We've got some of the staff. I won't let them ask questions beforehand. I'm literally like, hit the chat room, because we can't spill any information beforehand. But here it is. The chat room is beterrific.com slash live. Go underneath the live video player. There is a chat room. It's an IRC. Join anonymously or create a login so you can come back often. I'm checking it throughout the interview. I'm looking at it right now. Ben is saying, I've got to ask all these important questions. You guys come in here, ask these questions. This gentleman is Tom Kalinske. So awesome to have you here. It's great to be with you. And so the thing is, you started your career with, you did He-Man, right? In the beginning. [00:01:16] Tom Kalinske: Well, actually, I started my career at Mattel. Even you were before that. At Mattel, right? And I was part of reviving Barbie back in the early 70s. [00:01:23] Michael Artis: Reviving Barbie. It's hard to imagine Barbie needed to be revived. How do you do that? Did you have to do CPR on Barbie or what? [00:01:29] Tom Kalinske: Well, it was hard. I mean, the founder of Mattel, Ruth Handler, walked into my cubicle, which was right outside the ladies' room. It was very conveniently located one day. Yeah. And she said, Tom, Barbie had its first decline in sales ever. Sales fell all the way to $43 million. [00:01:43] Speaker 3: They fell all the way to $43 million in the 70s. The sales force says it's over. [00:01:47] Tom Kalinske: $43 million is a lot. The Wall Street analysts say it's over. The retail buyers say it's over. What do you think about that? I said, Ruth, that's the stupidest thing I've ever heard. Barbie will be around long after you and I are gone. She said, that's what I wanted to hear. You're now the marketing director on Barbie. [00:01:58] Michael Artis: Wow! Really? That's an amazing answer and story. And so you're the marketing director then, and what happens? [00:02:04] Tom Kalinske: Well, in those days, they only introduced one Barbie a year and one line of costumes and one accessory. And I said, this is crazy. Let's build the brand. Let's do lots of different Barbies. Let's do a Barbie for young girls. Let's do a Barbie for older girls. Let's do occupation Barbies. Let's do astronaut Barbie. Let's do president Barbie. Let's do doctor Barbie. And let's do high-end Barbie. Let's do Oscar de la Renta design costumes on Barbie and sell them for $100. Genius. So we segmented the market and the business took off and it grew to like $550 million. [00:02:32] Michael Artis: Ding, ding, ding. I mean, genius. And so here's the thing. I even, as a boy who completely rejected girls, dolls, I mean. Sorry, not girls. I love girls. Dolls. My mother tried to force Barbie on me, and I never wanted to play with it. But I will tell you that when I saw the girls that I would have as friends that were young, when we were young, I always thought that the beach Barbie with the Jeep was probably your creation or your idea. I always thought that looked fun. I never wanted to get involved in it, but always thought it looked fun. [00:03:03] Tom Kalinske: You know, the camper and the Jeep and the Ferrari were two great accessories for Barbie. Everybody loved those. [00:03:09] Michael Artis: All right. So then you move on and you're now, how do you get to He-Man? Because, okay, there were two shows I loved. And I'm going to tell you a quick story. There was Thundercats. Yes. And He-Man. Yes. And I was a big He-Man guy. And so I remember walking around the mall around the holiday time with my family and to distract me so that I wouldn't see the gifts they were getting me, because I guess that was the lack of planning my family had, that they were buying the gifts with me there at the mall. And so literally, they'd be like, oh, He-Man's over there. And somebody would take me. I just saw He-Man. He's here. And I was so excited. They'd literally take me to that part of the mall to go find He-Man. And then this person would go buy a gift. And then we'd switch. And I'd go with somebody else to find He-Man, because that person had just seen He-Man over at this part of the mall. And I'd get so excited. And I'd run and tear down the mall. And then they'd go and buy, you know, whatever. [00:04:02] Tom Kalinske: Yeah. Glad to have that impact on your life. You did. Yeah. [00:04:05] Speaker 3: He, I am, He-Man. I have the power. [00:04:08] Michael Artis: Yes. Oh, my God. It's such a great show. Yeah, it was. And great action figures. I had the action figures. Yeah. [00:04:14] Tom Kalinske: Well, the action figures came first. Yeah. We did all this research, because remember, in those days, Mattel didn't have an action figure line. Hasbro had Star Wars and G.I. Joe. We didn't have anything. So we did all this research. Should we do DC characters? Should we do Marvel characters? Should we do astronauts? Should we do policemen? Should we do this heroic, muscular character with his adversary, Skeletor? And that won in the research. So my team, which was brilliant guys, said, we got to do He-Man. And everybody thought we were nuts, because it wasn't a licensed or a TV show. But we did it. We did 75 million in revenue. Skeletor. Skeletor. You remember? [00:04:50] Michael Artis: I mean, to me, that is, villain-wise, that's a hard villain to sell at that point, I think. [00:04:55] Tom Kalinske: But he was so bad, the boys wanted him to show they had somebody to compete with. [00:04:58] Michael Artis: When you're in those meetings, they're like, yeah, He-Man needs somebody a little less, a little softer, right? Didn't they need a little, didn't that happen? [00:05:06] Tom Kalinske: It was controversial. Yeah. And Castle Grayskull was controversial, because it was seen as a, you know, a scary, negative place. That's what I'm saying. [00:05:12] Michael Artis: It's like, I can imagine sitting in those meetings and trying to sell Skeletor. I'm talking, you didn't have a TV show. You're saying, this is going to be amazing. And, okay, so who's the villain? Oh, it's this guy, Skeletor. [00:05:23] Speaker 3: Yeah. [00:05:23] Michael Artis: Yeah, maybe we could go for, like, about the Iron Sheik, which wasn't out yet. But, I mean, like, I'm thinking, like, they're like, yeah, maybe we could find, but maybe Darth Vader even paved the way for that yet. [00:05:33] Tom Kalinske: Well, certainly, because Darth Vader was awfully scary to young boys. [00:05:36] Michael Artis: All right, so then you get them to do He-Man, and you do so well, and then they say, we've got to. [00:05:41] Tom Kalinske: The chairman walks in my office one day, he says, well, it's great you made this a successful toy line, but it really won't be big like Star Wars is, because you don't have a TV show, and you can't get one. I said, you want to bet? And so we did a deal with Filmation and Group W. We each put up $3.5 million. Wow. We produced 65 half-hour episodes, which had a moral message at the end of each show. You probably remember that. Yeah, I remember this, yeah. And we gave it away free to stations across the United States, syndication deal. They gave us back three 30-second commercials, which we either used, we couldn't use them for He-Man, but we used them for other products, or we sold them to McDonald's or to a shoe company or to Kellogg's or whatever. Well, the show was so successful, we made a profit off the television show, and the revenue of the toy line grew to $750 million. [00:06:24] Michael Artis: This is genius. I mean, what people don't realize is that you gave the show away for free. Yeah. And you got back the money in advertising. But, I mean, like, to do that back then. It was the first time it was done by a toy company. [00:06:38] Tom Kalinske: Yeah. [00:06:38] Michael Artis: Unbelievable. And you became the ad agency, basically. [00:06:41] Tom Kalinske: Well, we ended up. Or a media buyer. We ended up selling a lot of media. Right, that's what I'm saying. Yeah. [00:06:46] Michael Artis: Yeah. Unbelievable. Okay, and now you've made He-Man a success, both on television and the figures. Right. And then what? [00:06:54] Tom Kalinske: Well, we did a movie with Dolph Lundgren, too. What was that movie? He-Man. I don't remember that movie. That's probably good that you don't remember that movie. [00:07:02] Speaker 3: What was that? The TV show was a lot better. So, he was He-Man? Yeah. Dolph was the bad guy in Rocky V. Oh, yeah. Yeah. He was He-Man. He was, I must break you. Yeah. I don't think he looked enough like me. [00:07:15] Michael Artis: He didn't look enough like what? Me. Yeah. You were the model for He-Man, right? [00:07:18] Tom Kalinske: I should have been, yeah. [00:07:20] Michael Artis: So, okay. Now, I didn't know you guys had a movie. How did I miss the movie? [00:07:25] Tom Kalinske: I don't know. It didn't last long, I guess, in the theaters is probably the answer to that. It was not a success? [00:07:29] Michael Artis: Are you serious about that? [00:07:30] Tom Kalinske: It wasn't a success. [00:07:31] Michael Artis: It's because you didn't give it away for free? [00:07:33] Tom Kalinske: Maybe. [00:07:34] Michael Artis: You know, that wouldn't have been a bad idea. You give the tickets away for free, give it to the theaters for free so they can get it. They make the money off the concessions, which is what they make money off of anyway. And you guys make the money off, throw some advertising, product placement right in the middle of the movie. [00:07:45] Tom Kalinske: And we did the touring show, like the Disney shows. That I remember, yeah. And that was one of the most successful touring shows for a boy's property ever. Yeah. I mean, it lasted for years. [00:07:54] Michael Artis: I remember watching those commercials for that in between and wanting to go see that. I never did, but in between the monster truck commercials, you know, Sunday, Sunday, Sunday. All right. So, now we get to the real stuff. Ben remembers the movie, by the way. He's one of five people that actually liked it. He's in the chat room, the IRC chat room. Good. Now we get to consoles. Yes. And the console wars. Now, you're the author of console wars. No. [00:08:15] Tom Kalinske: No. Yeah. Blake Harris is the author of console wars. He's the author. I'm sorry. It's about the time period where I was CEO of Sega in 1990 and 96. I'm sorry. [00:08:23] Michael Artis: I remember that and messed that up on you. I'm sorry. But there's a great book called Console Wars. Yes. Everybody's got to check out. And you, it's about your time period in the 80s. Yes. In the 90s. In the 90s with Sega. So, now you're, now, how do you get to Sega from Mattel? [00:08:38] Tom Kalinske: Well, I had done something in between called Matchbox toys. Oh, yeah. Something small. I never heard of them before. But anyway, I had gotten to know when I was at Mattel, the CEO and chairman of Sega. Because they did arcade games in those days. And at Mattel, we were looking for licenses. It was like a Barbie game, wasn't there? There was. Yeah. And so, I knew this guy. And he kept asking me to come work at Sega. And I kept turning him down. Yeah. And I was on vacation in Hawaii. And all of a sudden, this Japanese guy appears on the beach in Maui and says, Tom, I've been looking for you. I said, well, how did you find me? And he said, your secretary told me where you were. And I'm here. And you've got to come to Japan with me. And I said, well, why do I want to do that? I'm on the beach here with my wife and children. He said, no, no. You've got to come to Japan with me. Look at 16-bit technology. Now, I had never seen 16-bit technology. This was the genesis. Yeah. So, I went back to Japan with him. I saw it. And I fell in love. Because it was so different. [00:09:32] Michael Artis: What do you say to your wife? I could imagine. Because I could only imagine this conversation. Well, look. The guy came all the way to Hawaii. We've got to. It's only going to be a day. He says 20 hours. I'll be back in 20 hours. You know what, I'll tell you what. There's a really nice jewelry store over there. [00:09:47] Tom Kalinske: Why don't you put it on the room? My daughter saved me. [00:09:50] Michael Artis: Yeah. [00:09:50] Tom Kalinske: My little daughter was, she's my oldest daughter. She was about six then. And she, he's trying to talk me into going. And I'm resisting. And she says, daddy, you have to go with him. He came all the way here from Japan. You have to go back with him. And that saved me. So, I went. [00:10:06] Michael Artis: Yeah. Yeah. And you have understanding family. That's great. And then, so now, then you're convinced. You see 16-bit and you're convinced. I am. Yes. Yeah. And so then, we get Joe Montana football. 121 points I score every night playing Joe Montana football against the computer. Oh, and it was a lot of fun. I was addicted to this game. No joke. Yeah. And, and, and you, what was the slogan? It was, you can't do this on Nintendo. Yeah. And I loved my Nintendo, but I had to have a Genesis. [00:10:35] Tom Kalinske: Sega does what Nintendon't, was the exact end line on the commercials in the early days. And then it was, welcome to the next level. Yes. And then it was Sega, the screen. Oh, yeah. That we ended each commercial with. But the, the strategy, as you said, was to do lots of sports games. Yeah. It was to lower the price of, of Genesis to $149. It was to put Sonic the Hedgehog in. It was to go after teens and college kids instead of little, little kids. Right. And leave little kids to Nintendo, go after older kids. [00:11:04] Michael Artis: And, and I think you hit me at the right point because I, I was a big Nintendo guy, but I was growing out of Nintendo. A lot of the, you know, Tecmo Bowl was fun. Yeah. But a lot of the, the, the games I was out growing, I needed the next thing. Right. And you were, you were there. I remember just, I wanted this Sega so badly. And, and my parents didn't want me to have it because that meant buying all new games and spending $50 a cartridge. Right. And I liked that the sports games were there. But what about Sonic? It took me a long time to wake, warm up to Sonic. I really didn't love that game in the beginning. And I, because I, I knew who the Mario brothers were, but I didn't know who Sonic was. And it just, it seems so fantasy about it to me. [00:11:39] Tom Kalinske: Well, we, we built the Sonic brand much like we built toy brands in my past life. We did a Sonic television show. Sonic 1, I thought was a pretty good game, but Sonic 2 was a sensational game. Much better game. Yeah. We brought the team from Japan to the United States and they worked with some of the U.S. guys down the street from our, our headquarters in Redwood City. And they built a great game on Sonic 2. [00:12:00] Michael Artis: Did this ever get like super competitive between Nintendo's a Japanese company, Sega's a Japanese company. They got, there's Atari out there at the time. Everybody's trying to one-up each other. Yeah. I'm sure, you know, Nintendo probably thought they were doing pretty good. And then you guys came out with the Genesis and I imagine that it, there's got to be some competition. [00:12:15] Tom Kalinske: Oh, it was, it was ferocious. Yeah. It was absolutely ferocious. We hated each other. We would, you go, we made fun of Nintendo in advertising. We portrayed their machine as being for old, slow, little kids and we were the hip, cool product. [00:12:31] Michael Artis: It was the original I'm a Mac and I'm a PC commercials. [00:12:33] Tom Kalinske: Yeah, it really was. Yeah. It really, it really was. And, and we would do mall tours where we, we introduced the Super NES before they did. We bought them in Japan, brought them to the U.S. and we'd go on mall tours and we'd show kids, teens and college kids, here's Mario on Super NES, here's Sonic on Genesis. Which do you think is better? And 85% of the kids picked us. You were brutal. Was this part of your plan? This was your idea? Well, it was my, my and my team. I encouraged aggressive marketing. I love it though. I love it. You just like, you, you just put your foot on the gas and never lift it off. Yeah. We had kids on each college campus who were cool guys who played video games. Yeah. We'd give them a Genesis and we'd send them new software every month. And they all had to do was go around campus and talk up Genesis. It was fantastic. Why didn't you come to my house? I didn't know you then. [00:13:23] Michael Artis: What, what was the craziest thing you guys did publicity wise to basically knock Nintendo off the pedestal they were on? [00:13:28] Tom Kalinske: Well, one of the fun stories was Nintendo was so powerful that third party developers were afraid to develop for Sega because they were afraid Nintendo would punish them. Retailers were afraid that if they carried Genesis, they wouldn't get enough Nintendo hardware or software. So Walmart, big Walmart, powerful company, they were afraid, it's appeared anyways, to carry Sega. So they turned us down and down the street in Bentonville, Arkansas, there was a strip mall. I opened a Genesis store, big sign, said, come play Sega for free, had lines of teen outside the door. I bought every billboard in and out of Bentonville on Highway 41 and Highway 71. And I bought all the radio and TV advertising and I bought the seat cushions in the University of Arkansas football stadium down the, down the road. So when you know how they hold up the seat cushions to make it say different things, different colors. On the other side, it said Sega. So across the stadium, you'd see Sega. [00:14:21] Michael Artis: Wow. [00:14:21] Tom Kalinske: And finally, I got this call from the vice president there saying, okay, we give up, we surrender, we'll, we'll buy, we'll buy Sega. [00:14:28] Michael Artis: Wow. [00:14:29] Tom Kalinske: It was fun. That's an amazing story. That was fun stuff. [00:14:31] Michael Artis: What about your favorite Sega game? [00:14:33] Tom Kalinske: Well, my favorite Sega game actually is Sonic 2. Really? I love Sonic 2, but I did like Joe Montana football too. I love Joe Montana football. [00:14:40] Michael Artis: You have a, but you had like a personal connection to Joe too. [00:14:43] Tom Kalinske: I have a good relationship. [00:14:44] Michael Artis: First of all, how'd that happen? How'd you, obviously Joe was like the big deal then, right? Well, especially in San Francisco. Joe, but so how did, but how did you get Joe? I mean, back then guys, there was no Madden. Guys didn't lend their names to games. [00:14:56] Tom Kalinske: No. [00:14:56] Speaker ?: No. [00:14:56] Tom Kalinske: Well, actually it wasn't me. It was a guy who worked for me, contacted Joe and suggested that we may put him on the game. As it turned out, our kids were in the same school together. So our kids knew each other. And then I got to know Joe and his wife, Jennifer, and it turned out to be a terrific relationship. And Joe did, not only was he good at helping us design the football game, he did great commercials. He did. Yeah. Well, how come there's no Joe Montana football still for Sega? [00:15:24] Michael Artis: Because I'm not there anymore. Okay. I'll buy that. I will buy that. I could see that. I know that there was this one thing where EA got the rights to the NFL for 10 years. I think that's over now, but they literally locked down the NFL for 10 years. They did. [00:15:41] Tom Kalinske: They did. And they had Madden football. And Madden, we originally outsold Madden football even after it was introduced. And eventually Madden became the game. [00:15:50] Michael Artis: And I think the thing was for Sega too back then, you were trying to be a console company, not so much a game development company really. Because it was really about having other people make the titles, right? [00:15:59] Tom Kalinske: Well, we certainly wanted them. We wanted to get lots of third parties developing on our platform. But we tried to do a number of hit games ourselves, like Sonic 2, like Echo the Dolphin. [00:16:08] Michael Artis: What about Shining Force 2? Ben says that was epic. [00:16:11] Tom Kalinske: Shining Force 2 was a great game. Yeah. Great game. That was done by our Japanese, I think, AM2, we called it, the group that did it over there. [00:16:18] Michael Artis: Very, very cool stuff. What do you think of the gaming industry now, considering the fact that people are making millions of dollars playing video games professionally? People are playing video games on Twitch and on YouTube and making tons of money? Game developers and creators are making tons of money? And Curt Schilling lost a fortune doing it? What do you think of the industry and what it's become? [00:16:38] Tom Kalinske: Well, to me, I feel very blessed to have been part of it. I think we helped change it to older kids and college kids playing. When I left the company, the average age was 21 of the game players. Sony today says their average age is 31. The business grew. When I left, it was a $7 billion industry. Today, it's a $63 billion industry. I'm very proud that I had something to do with that. [00:17:01] Michael Artis: What do you think of the PlayStation 4 and the Xbox One? I mean, I don't think those exist without Sega. Seriously, because realistically, everybody was very comfortable where they are. And then, boom, you guys come out. Now, everybody's scrambling. You've got to have Super Nintendo. Everybody's got to step it up. The Neo Geo comes out. You have Atari is trying to make a comeback at that point. 3DO, yeah. [00:17:22] Tom Kalinske: No, I agree with you. I think if we had not been successful in dethroning Nintendo, we actually passed them in revenue and market share for a period of time. If we had not been successful doing that, I don't know if Sony or the other guys would have had the stomach to enter the industry. And there really wasn't computer gaming like there is today at that point. [00:17:41] Michael Artis: I mean, I remember playing Wing Commander on this PC, but it wasn't like that I had. But it wasn't like it is today. [00:17:46] Speaker 3: Yeah. [00:17:47] Michael Artis: Carmen Sandiego was the big game on the Commodore 64. Right. Yeah. [00:17:51] Speaker 3: Right. [00:17:51] Michael Artis: And so, what about, did you shake your head when Nintendo would come out with some titles? Were you ever like, oh, that's awful? Or was there a time where you were ever scared? Like, oh my God, they really beat us on this title? [00:18:03] Tom Kalinske: You know, we obviously, even though we were highly competitive, we admired what they'd been able to do. And after a while, we became somewhat friendly, although they were really good at dirty tricks. I mean, the whole industry Senate hearings against the video game industry, that was actually started by Nintendo. Because they didn't like the fact that we were showing games that were more aggressive and had blood in them. We were after an older audience, they were after a younger audience. So, there was that natural tension, if you will. So, they were pretty good at dirty tricks in the industry. But I admired what they were able to do with games. They did develop terrific games in large part. Every now and then, they had a failure, too. [00:18:45] Michael Artis: Was there ever a game that you said, oh my God, they got us beat, this game's unbelievable, they're going to sell a trillion of these? [00:18:50] Tom Kalinske: Well, probably the Donkey Kong, yeah. [00:18:54] Michael Artis: What about, you guys never had a power glove, you never had a gun for, like, a duck hunt gun or anything? That was the only thing to me that was really missing with Sega, with Genesis. [00:19:02] Tom Kalinske: Well, we've tried different accessories from time to time. But accessories, in our experience, were not big hits. You know, we were not that great at big accessories. [00:19:11] Michael Artis: You know, yeah, it's different, you've got the Kinect and all this stuff. Yeah, yeah. But what about, you know, Sega Game Gear? Were you part of that? Because I loved my Game Gear. I had to have that. The only thing that was negative about the Game Gear, it was huge, and the batteries died way too fast. [00:19:26] Tom Kalinske: Yeah, I agree with you on that, and I loved Game Gear. Color LCD against black and white Game Boy. We used to do commercials where we compared color against black and white. We had a commercial where we had a dog drinking out of the toilet. That was my air deal, by the way. And we would say, well, you know, dogs are colorblind, so if you don't care about that, you can play Game Boy. I remember that. [00:19:48] Michael Artis: I remember that. What about, didn't you have one that said, do you want to play on the spinach green screen? Yes. Right? Wasn't that? Yes. I had a Game Gear. I loved it. I took it everywhere with me. It was phenomenal. And I think Sonic came with that, if I remember correctly. Very cool. And then, so, you were at Matchbox. We can't not talk about that for a second. Tell me about Matchbox and being there. I had every little car and the little wheel with the cars in it and everything. Like, I wanted Hot Wheels, too. I wanted both. Yeah. I would never get Hot Wheels, but I had the Matchbox. I remember going to the stores and getting the little box with the car in it. [00:20:22] Tom Kalinske: Yeah. Well, of course, when I was at Mattel, I worked on Hot Wheels as well. And so, I loved die-cast cars. And the Matchbox company had gotten into trouble in England. It was an English company, and they'd gone into receivership. And a friend of mine, David Yeh, who was a Chinese manufacturer, a very successful guy, had worked out an arrangement to buy the company and asked me to join him on that. So, I joined him, and we helped. Companies are in receivership for a reason. There was a lot of issues. We restructured the whole company. We got it back on the right track. We made it profitable in the UK, and then the rest of Europe, and then Australia. And finally, the last market was the United States. Made it profitable. We had it public. And it was the hardest three years of my life doing that, by the way. But I loved die-cast cars. We were doing them realistically. We made sure that every detail was accurate. We had a great collector business on it. But it was an exhausting experience, and we ended up selling the company eventually. [00:21:13] Michael Artis: I used to go to Jay's Stationery in Great Neck to get my matchbox cars. Yep. And there was big-top toys that I would go to get my console games on Long Island. And I just loved the console gaming. Tell me about Console Wars. Tell me about the book. [00:21:28] Tom Kalinske: Okay, so three years or so ago, the author, Blake Harris, contacted me here at Toy Fair and said, I want to do a book on the period of time that you were at Sega, 1990 to 1996, fighting against Nintendo. And I said, that's very interesting, Blake. There's probably 200 people in the world that care. And he said, no, no, you're wrong. There's all these guys who are really interested in that period of time, and retro gaming is back. And eventually, he convinced me. So, Blake went out and interviewed 300 people. He interviewed Sega people, Nintendo people, the guys in Japan, our retailers, consumers, and put together a terrific story about that period of time. [00:22:06] Michael Artis: I think it sounds amazing. I've got to get my hands on a copy. I've got to read it. I think it should be a documentary, to be honest with you. I'd love to hear these stories. The documentary's been shot. It has been. So, can we watch it? The documentary's been shot. How do we watch it? [00:22:16] Tom Kalinske: The documentary's in final editing. Okay. I talked to Blake yesterday. I believe it's going to be available in the late spring. [00:22:23] Michael Artis: We've got to have you back on to promote that. We've got to watch that movie. Console Wars is going to be a documentary. [00:22:28] Tom Kalinske: And a feature film is being made. A feature film. [00:22:30] Michael Artis: Yeah. Wow. I mean, it deserves it, though. [00:22:32] Tom Kalinske: Seth Rogen. Who plays you? I don't know yet. Seth Rogen and Evan Goldberg. You might have heard of them. Who? They did this movie called The Interview a little while ago. Yeah, yeah, yeah. And a lot of other movies. I'm kidding. I know who Seth Rogen is. And they're writing the script of the feature film. Scott Rudin, who produced Moneyball, Social Network. The Interview as well. And he's going to produce the movie. He made a big noise with that, too. Sony's going to distribute it. But like you, I would love to know who's going to play me. My daughters are hoping for Bradley Cooper. [00:22:59] Michael Artis: Really? That's not a bad call. I could see that. [00:23:01] Tom Kalinske: We have the same ab structure. [00:23:03] Michael Artis: Yeah, definitely. Definitely. Maybe 20 years ago. Exactly. There you go. All right. And you're with Leapfrog now, which is a lot of great stuff. Yeah. Educationally for kids. Talk about that a little bit. [00:23:13] Tom Kalinske: Yeah. So, I left Sega in 96. Why? We missed you. Lots of reasons. But anyway, I was hired. Is it in the movie, in the book? It is. Okay, great. It is. I was hired by Mike Milken and Larry Ellison to put together a company called- [00:23:27] Speaker ?: Wait, wait, wait. [00:23:27] Tom Kalinske: Michael Milken? Yeah, and Larry Ellison. Is this the Michael Milken? And Oracle, Larry Ellison, to put together a company focused on education, using technology to improve education. And we did 36 different companies over the next nine years. One of them was Leapfrog. Okay. I went in as CEO. And here's the deal. We're using video game technology and real education to make education more fun and interesting for young children. Teach them to get interested in reading and learn to read at a young age. Teach them to get interested in math at a young age. But make sure it's all fun. [00:23:57] Michael Artis: Look, my son, Jack, is 21 months old. We were at Toys R Us, my wife and I, last week. And she said, we got to get him this Leapfrog stuff. She's showing me the whole department on Leapfrog. This is not a joke. This is not a plug. This is serious. And we're sat there for 20 minutes looking through all the stuff and picking some stuff out because it's about education and about having him be educational. We want to get him. He's already on our iPads and stuff. We want to get him off of that a little bit into more educational stuff. I do like what you guys are doing. And we want to talk more about that in the future as well. Your time has been amazing. I'm going to do something very special for somebody who's in the audience here. Adam Holtz is a great guy. He's a great team member of Be Terrific. He's a great producer. His brother, Brian, is here. He's been helping us produce. I want to bring Brian on. This guy, he's got to come on. I'm going to give him one question for you. He has been so excited for you to come. Listen, I don't even want to tell you, he had car trouble today. He made it through car trouble. He says to help us produce. I think it was just to see you. We've got to come on. There's a mic on the floor, Brian. When you walk in, you know the mic. Put the camera down, except for maybe somebody can take pictures of you. And Brian, I know he does not like these. These boys do not like going on camera. Watch the track. Go grab that mic. And we'll get you on camera, and we've got to get a question for you. You come right here, and maybe Adam can work that camera for you to widen the shot a little. [00:25:16] Speaker 4: You know, you explained a little bit to me before about the possible Sega-Sony collaboration earlier. I was just wondering if you could kind of explain the story or expand on it with the audience, because, you know, you and I had spoken about it a little bit. [00:25:31] Tom Kalinske: Sure. So back in the mid-90s, we were working closely with Sony, and they were learning how to do software in those days. And we became very close. They had just recently gone through a bad relationship with Nintendo, so they were a little angry at Nintendo, which, of course, helped us. And we started working closely together. We became very friendly. So one day, we were talking about, why don't we do the next hardware platform together? Do a Sega-Sony platform, or call it Sony-Sega. It didn't matter. And we'd do it together. One hardware. Because you generally lose money on hardware, and you make your money on the software. Yeah. And so we were better. It's the razor blade concept, right? Yeah. We were better at doing software than we were, so I thought this was the best deal in the world. And so our R&D guys, anyways, agreed on a design. We go to Sony, and Sony says, yeah, it's a great idea in Japan. It's a great idea. Let's do it. Go to Sega, and the Sega guy said, no. Why should we help Sony? And honestly, I thought this was the dumbest business decision in my lifetime. Because imagine what today could have been. It could have been Sega-Sony PlayStation. Yes. And it would be great hardware and great software from Sega. [00:26:41] Michael Artis: And I'm dreaming about this, and I'm dreaming about a PSP that is a Game Gear PSP. Yeah. That would be great. That would be terrific. Oh, all right. Brian, great question. Do you have one more for us? Come on, one more. One more, Brian. Brian. Brian. Brian. That's it? One more? You want to ask it off camera? I'll translate it? He had so many before. We talked earlier. I know. I answered a lot of his questions. Yeah, but I want the viewers to hear these great questions. This is why he wasn't supposed to talk to you off air. All right. Was there a question that he asked you or a story he got out of you? Because that's a great story that he got out of you that you can retell. [00:27:18] Tom Kalinske: Oh, my goodness. [00:27:19] Speaker ?: All the chipset stuff. [00:27:21] Tom Kalinske: Oh, the chipset stuff. Yeah. So, again, I wasn't crazy about the original specs for what became the Saturn. [00:27:30] Speaker 3: Yeah. [00:27:30] Tom Kalinske: And so, I knew Jim Clark, who was then chairman of Silicon Graphics in Silicon Valley. And he called me up one day and said, I got a great chipset that you're going to love. It's going to make a wonderful video game machine. A guy here named Jensen Wang designed it. That guy later founded NVIDIA, a famous company. And so, my guys went over and we looked at this chipset and we really thought it was great. And so, we called the Sega hardware designers in Japan to come over and look at it. Because we thought it was a better chipset than, frankly, what was going into Saturn. And they come over and they look at it and they said, ah, it's too big, too big a chip, what have you. It'll cost too much. And so, they rejected it. And so, Jim asked me, he said, well, what do I do now? And I said, well, there's this other company in Seattle you might try selling it to. And that became the chipset that's in the N64. [00:28:18] Michael Artis: Wow. That's unbelievable. [00:28:21] Tom Kalinske: Yeah. [00:28:22] Michael Artis: That was a very nice thing of you to do. [00:28:24] Tom Kalinske: Well, I like Jim. [00:28:25] Michael Artis: Yeah. [00:28:26] Tom Kalinske: And I was a little angry at Sega at the time. I'll tell you what. [00:28:29] Michael Artis: You want to play a little slot car here? You seem like a guy who likes to have fun. Yeah, I do. So, I'll be the inside car. I'm going to be the white car, I think. No, I'm the white car here. Yeah. Okay. And I'll say three and then we'll go. And while we do this, if we can get it going for a little while, we'll talk a little bit. I have one last question for you. Okay. But I really appreciate your time and everything. All right. Here we go. You ready? Yep. Three, two, one. I guess we can't hit the turn at the same time. What the heck? Maybe Brian can reset this real quick. He won't be on camera. I promise that. What do you think of these stadiums? They're filling stadiums playing video games now. Is that just blowing your mind? [00:29:05] Tom Kalinske: Well, you know, the whole thing about Twitch TV, 65 million people watching others play video games. Yeah. Isn't that fantastic? It's unbelievable. Who would have thought of that? Who would have? It's right. Well, I'm also a partner at Alsop Louis, Venture Capital, and we invested in that company. Very smart move. Yeah. Early on. Very smart move. All right. Here we go. [00:29:21] Michael Artis: Three, two, one. And I'm the blue one now. Oh, we got the crossover again. Oh, and the crossover. Sorry. Well, it was a lot of fun. Thank you for playing. Thank you for coming on. Please stay in touch. We've got to have you on more. [00:29:33] Tom Kalinske: Terrific. [00:29:34] Michael Artis: All right. [00:29:34] Tom Kalinske: You like the PlayStation? Thank you. I do. We've got the PlayStation 3 at home. We don't have four yet. And we have Xbox One. You're impressed by what video games have become? I am. I mean, the graphics are incredible. The play is incredible. I still like sports games. [00:29:48] Michael Artis: Me too. [00:29:49] Tom Kalinske: Yeah. [00:29:49] Michael Artis: I can't stop playing them. And I'll take any sports game. Basketball. I even like the snowboarding games. All that stuff. [00:29:56] Tom Kalinske: Yeah. Yeah. The basketball is sensational. [00:29:58] Michael Artis: Absolutely. Remember NBA Jam? [00:30:00] Tom Kalinske: Yes. Very much so. [00:30:01] Michael Artis: He's on fire. We're going to break. We'll be back with a whole lot more from your official Toy Fair live coverage. Toy Fair 2015 at the Jacob K. Javits Center in New York City. I'm Michael Artis. Michael Sheen is the real thing. We'll be back on Be Terrific with a whole lot more right after this.