The most current rumour to spring out concerning Sega is that they will be developing software for Sony's PS2. According to the Jiji news agency in Japan:

Sega will unveil a reorganization plan by the end of January 2001 that will include an announcement that it will be supplying software for rival Sony Corp's popular PlayStation 2 computer entertainment system.

Sega are outright denying this at the moment, claiming its another attempt by the media to "sabotage" them (much like the "Nintendo buying out Sega" rumour).

Why the media would want to sabotage Sega, I really have no idea. ps2.ign.com has the story as originally reported by the Jiji News Agency, and dreamcast.ign.com has the Reuters version of things.

heh, how hard is that going to be, the ps2 is s*** :)
flame on!

first post too.

i would rather have a dreamcast =/

Yeah, ps2 is pretty ghey isn't it *baits hook, dangles line*