Just about ten years ago, Sega released the critically acclaimed yet underselling Shenmue for its Dreamcast, then produced a sequel for DC and the original Xbox a few years later. The series never lit up sales charts, but it does have its ardent fans who are still waiting for Shenmue III all these years later. Sega has been reluctant to produce a sequel, but is now apparently willing to do so if either Sony or Microsoft will commit to an exclusivity deal. GameRanx has the story as published in Japanese gaming magazine Famitsu.
Although Shenmue received it's fair share of critical acclaim, it was not a big seller and considering it was one of the most expensive($70m) games back in the days, Sega is reluctant to take the plunge alone. With exclusive titles being hyped up and well marketed by both Sony and Microsoft it seems Sega is also looking for something extra apart from the investment.
I've never played either Shenmue game and I'm willing to bet that most other gamers haven't either. Whichever company that picks this up (if either) really should consider reintroducing the franchise with a God of War Collection-style re-release of the existing games before committing to a full new sequel. It would be a good way to test the waters, as it were, before throwing bad money after good.