There are two big rumors going on after this announcement.

1) Sega is making a comeback in the home console market.
2) Sega is partnering up with Microsoft to market and/or distribute the Xbox Series X in Japan, where the Xbox is struggling and has been struggling for years. https://twitter.com/Daily_Express/status/1265624801919545350

Take these rumors with a tiny grain of salt.

I don't see how Sega will ever want to make a new console to compete with the big three, especially since they've been doing well as a third-party publisher for almost 20 years now. The console market nearly bankrupted them.

The Saturn was a big financial blunder for them. The Dreamcast was their last ounce of hope, but it wasn't enough to save them and the console itself would be quickly overshadowed by the PlayStation 2. Why would Sega wanna go back to that? It doesn't make ANY sense.

I'm sure the hardcore fans would go apeshit over a new Sega console, but from a business perspective, it would be very confusing.

And even if Sega were to make a new console, it wouldn't be the Sega we all remembered from the 90s. Not even close.

They'd most likely copy what Sony and Microsoft are doing: make a powerful and expensive home console, games are on Blu-ray discs, and it has streaming features like Netflix, Hulu, Disney+, HBO Max, etc. Nothing special apart from maybe its own first-party exclusives.

Plus would third-party publishers even support a Sega console?

Now about the other rumor: Teaming up with Microsoft to distribute/market the Xbox Series X in Japan.

This rumor makes a bit more sense. The Xbox brand since its inception has been a complete failure in Japan.

The Xbox One's lifetime sales over there are only in the double digits. Plus Sega did work with Microsoft before to help market the original Xbox for its Japanese launch.

That said, I don't see it working. The internet is more prevalent than ever. Everyone in Japan knows the Xbox brand is a Microsoft brand, and they don't touch western consoles with a 10-foot pole.

Another problem is that home consoles in general are declining over there. Handhelds are all the rage. The Nintendo Switch is the only system there that's selling like gangbusters in Japan. Even the PlayStation brand is declining.

The PS4 did okay over there, but with Sony shifting focus largely to western audiences, that makes their consoles far less appealing to the Japanese. All they have left in terms of Japanese exclusives is....Persona.

I think the PS5 will struggle in Japan, and the Xbox Series X won't do any better over there. Nintendo will crush them in sales.

Microsoft is in an even worse situation in terms of exclusives. Xbox has NO exclusives whatsoever, let alone exclusives that appeal to Japanese gamers

Every single Xbox One title (minus Halo 5 and Rare Replay) is on at least another platform, whether it's PC, PS4, Switch, two of them or all of them.

Microsoft has to REALLY convince the Japanese market that their console is a must-buy, even with the help of Sega.

There's another rumor that Sega could make a new arcade board for the arcades, which makes the most sense since the arcades are still relevant in Japan.

Whatever it is, this coming Tuesday should be very interesting. Maybe people's expectations are completely overblown.