Sega confirmed to GamesBeat that it has handed out layoffs at Sega Networks, its mobile division in the West.

The company attributes the changes to a new focus on IP-based games created by internal studios, bringing popular Japanese mobile games to the West, and “mass market view-per-play games designed to further Sega’s network strategy in the West.” The mobile market is worth $34.8 billion, according to market research firm Newzoo, but mega-publishers like King and Supercell dominate outside Japan. It can be difficult for other companies, even those established in more traditional gaming markets like Sega, to compete. Sega also faces competition in Japan from giant mobile hits like Puzzle and Dragons and Monster Strike.

Sega would not confirm to GamesBeat exactly how many employees it let go.

“In response to challenging and hyper-competitive mobile market conditions, Sega Networks Inc., Sega’s mobile division in the West, has refocused its operations and made a reduction in workforce,” Sega told GamesBeat. “As a result, we said goodbye to our talented friends and colleagues at Three Rings Design Inc. alongside a small number of team members on the publishing side of Sega’s mobile division.”

Three Rings Design created mobile games like Spellwood and Corpse Craft. When Sega talks about focusing on IP-based games, it likely means more titles based on its famous Sonic character. Mobile games like Sonic Dash have already done well for the company.