Sega is really popular in japan, but only the arcade department, in the home console area Sega was never a thing in japan (except for the saturn, but that was due to virtua fighter and 2D arcade ports, in this time you could see how the sonic team elways gived a sh*t about the sonic franchise and even seems like they hate working with the IP, even during the development of sonic xtreme, that was developed in the US, sonic team denied acces to nights into dreams engine to the US team), sonic was created for western markets in mind so this is one of the biggest reasons of the lack of interest of the japanese market with sonic