http://kotaku.com/5359917/create-and-share-your-own-2d-sonic-levels
what interests me the most is the controller for $15.

...fail?...
Because, people already can get a pad. Because people loggin to the net to play Sonic 1, when there's so much content Sonic-related that one can get from the net >and play offline<.
Or is it the fact they are asking actual money on a monthly basis to let people make levels for an old game. You know, the only people that might be actually interested in making Sonic levels problably won't pay... because they are problably all involved in one or more of the several Sonic-related fan games being made all the time. So... why pay? And why pay *monthly*? To access some great new content? Oh way, that's right, people can enjoy it... for free.
So no. IMHO fail. If Sega still had some brain power around, they'd:
1. Make a better use of the huge back catalogue they possess, including reuse of old games AND new games based on those IPs. Yes, maybe some good games, not the new ones they've been making ever since;
2. They'd invest in a legacy console (real hardware) that could play all disc-based games Sega has ever made, and allow to play the cartrigde based digitally. On this topic alone, SEGA would do alot of money on a niche market, but hey... game companies rarely aim at niche if it doesn't ring high profit...
3. Then, they could start thinking in a way to return to the current-gen console arena, if it would be viable.
At least they are making a new Sonic game in 2D... let's see how that comes up...

Gotta love how id recreate and maintain the ten year old Quake 3 as a free browser game, release the engine and developer tools as open source and generally just rock.
Then Sega try and recreate and maintain the fifteen year old Sonic games as a free browser game... unless you actually want to create content for it. In which case you have to cough up the currency...
How does that even make sense? The only reason why user made content has ever worked on PC is because it's free to develop.
If this is how Sega plan to recapture their youth, it ain't going to work. It's good to see that they're interested in the PC and in reviving their roots, but they're already showing they haven't gained much in the way of business sense over the years.
As a console manufacturer? I think the best move they made was to leave that behind. It's a shame they had to scale back so much on software development, but I can't see why anyone would want to develop a current gen console (and the Wii doesn't count, if we're honest).

i wonder if you could play street fighter IV with it.

...current gen, as in 'new upcoming gen' (this 'current' gen was until a couple years, the next gen). In short what i meant was: make a new proper console for the upcoming generation, whatever the timing of said gen. (er... got that? :D )
Also, they came off console gen because they were indeed sinking, and the Dreamcast was the last blow, but i consider that poor business rather than poor hardware performance - it is a fact the Dreamcast is one of the biggest worshiped 'late' consoles, and many will swear by its attributes for the time.
Still, considering they went software only, i can't remember a sigle title from them after console, that managed to be anything remotely sega-quality worldwide (i'm not saying Sega is/was the best company ev4r, mind you. Just saying).
The last Sega Rally... maybe... Outrun Coast 2 Coast was meh... Sonic games ever since, complete trash... oh well...

I suppose you could, but any controller that isn't an Xbox 360 controller is a little confusing to setupstop being so picky, they could have just ported sonic 2 again and called it a day.

...i might come as picky, but i guess i'm really just venting about the fact. I'd love to see Sega come back to its former self, either as software only, or all out hardware as well. I suppose Sega and some other companies just trip over themselves these days... oh well...
\rant
edit:... and then, Sega porting Sonic 1, Sonic 2, Sonic 3, Sonic & Knuckles (to keep it at the 'main' lineage of MD/Genesis games) AND include editing options for all of them, and at most a ONE TIME initial payment, and i'd happily support this. You see, its this little extra step towards a good appealing deal that i really miss from these companies. I can only dream...

Try this instead:
Control Mode
At the title screen, press Up, C, Down, C, Left, C, Right. While playing, you can pause the game and use A to restart, B for slow motion, and C for frame advance.
Debug Mode
Enable Control Mode. After pressing Start to begin a game, hold A until you see Sonic. If you see a bunch of hex numbers on the top of the screen, you're in Debug Mode.
To start debugging, press B, then you can select any sprite in that level and put it on the screen. To select a different sprite, press A, and to place it on the screen, press C. Note that sprite selection is different from Zone to Zone. Also, instead of displaying the time elapsed, it displays the number of sprites currently on the screen. Control Mode functions work as well.

You might be satisfied with the new Sonic 2D that comes out next year. It's a start.
Otherwise, I pretty much agreed with everything that you have said. You deserve a +.

It's important to recognize that the monthly cost isn't just for the Sonic level editor. It's part of their whole VIP service package, which includes access to quite a few other games. If anything, free access to playing the levels is a goodwill gesture on Sega's part, to try to get people interested in the paid service. They certainly aren't suggesting that people should upgrade just for the level editor.

...in name of fairness, i further inspected 'Play Sega' beyond the presented article. As it turns out the VIP option indeed allows for subscription of other games. However, those are MegaDrive games and while a decent choice, they aren't worth the value for someone like me who already owns many of them. The system problably will implement some other games from other systems (inc Sega CD or 32X, for example), i don't know.
My point on subscription remains though: VIP offerings as they stand now, are still of meager appeal. And i could argue that for a monthly subscription of the current titles, one could problably buy a sega compilation from the many available for several consoles and PC IIRC. I suppose it comes down to the personal option of each one. :D In anyway, SEGA is at least trying :) ...

Meh, Sonic can speed hump the blade of a lightsaber for all I care. That said, if I WERE to use it, I would enjoy making a haunted, bloody gothic castle.

By this reasoning, every single product that anybody has ever sold 'fails' because it offers no value to the people who already own it.

Not "every single product that anyone has ever sold" is an identical replica of another product.

... i took it like that in my specific situation; i didn't mean to imply it would not appeal *to others that haven't experienced those games*, as i try to describe further ahead in the post. That said, i would have a hard time 'renting' those games, if i already possessed them, would you not? :) So, in conclusion, to me, that part of the deal doesn't appeal...