Gaming legends Sega and Xbox creators Microsoft have entered a "strategic alliance" to allow the former to create large-scale, global games.
Sega said this would allow it to move forward with 'Super Game', an as-yet-undisclosed project it first mentioned in May of this year, set for release within the next five years.
The deal with Microsoft will allow that game to be developed and built on the Azure cloud platform.
The key focuses for Super Game are 'global', 'online', 'community' and 'IP utilisation', Sega said.
This could indicate some kind of massively multiplayer online role-playing game (MMORPG) game, involving iconic Sega characters such as Sonic the Hedgehog, Blaze Fielding from the Streets of Rage games or even Kazuma Kiryu from the Yakuza series.
It could also signal a move into the so-called metaverse, which Facebook recently announced it was pivoting too.
"With the world now more connected than ever, consumers can more easily enjoy high-quality entertainment content at any time," Sega said.
"As such, video games continue to grow as a major medium for gamers globally, with access to a vast range of gaming experiences and communities becoming more diverse and attainable.
"This proposed alliance represents SEGA looking ahead, and by working with Microsoft to anticipate such trends as they accelerate further in future, the goal is to continue to bring high-quality experiences to players."
A bid for Sega by Microsoft has been rumoured for decades, Reuters reported, with Japan remaining a relatively weak market for the US giant.
However, one analyst said talk of Microsoft buying Sega was "missing the point".
Daniel Ahmad, a senior partner at Niko Partners, tweeted that "more companies are exploring so-called 'Super Game' and 'Metaverse' concepts, and Xbox can benefit through its end to end offering".
Most people think of Xbox as business-to-consumer (B2C), but the business-to-business (B2B) technology side has become increasingly important for gaming, he said.
"A lot of people are missing the point by claiming this means Microsoft might acquire Sega, or saying that this is ultimately meaningless."
Sega games like the Yakuza series are already available on the Xbox and PC via the Game Pass subscription service, so this alliance is just a furthering of a partnership that has already existed for years.
They are also available on PlayStation.
Nintendo recently launched a new expansion pack for its online gaming service that gives gamers access to legendary Mega Drive games such as Sonic the Hedgehog 2, Ecco the Dolphin and Castlevania: Bloodlines on the console for the first time.
