Who Killed Sega's Console Business?

In 2002 Sega announced that it was withdrawing from the home console business to focus exclusively on producing games for other consoles. Just who was responsible for the death of Sega's console business? Most people would peg the Dreamcast as the culprit, and its easy to see why; while it had a successful debut, the system failed to keep momentum and eventually languished in the shadow of the juggernaut that was the PS2. But I believe many people have the wrong guy. The real culprit is the Sega Saturn.

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This is the face of a cold-blooded murdering maniac!

Development for the Saturn began in 1992 and was originally conceived as a joint venture between Sega and Sony. However the two companies had very different visions for the future of gaming. Sega wanted to create a platform that could render 2D and 3D images equally well while Sony wanted to create a console which focused solely on 3D graphics.

Sega of America also wanted to focus on 3D graphics and began brokering a deal with Silicon Graphics to create the graphics chip. Unfortunately Sega of Japan rejected the deal and as a result Silicon Graphics moved on to help Nintendo develop the graphics chip for the Nintendo 64.  This would prove to be the first of many poor choices Sega made for the Saturn.

The console was released in Japan in November of 1994 to very good sales. It was announced that the console would be coming to the United States in September of 1995. However, Sega of Japan felt an earlier launch would give Sega a leg up on the forthcoming Sony Playstation, so on May 11th 1995 at E3, at the end of an incredibly weird announcement reel, Sega of America CEO Tom Kalinske announced that 30,000 units had already been shipped to certain retailers for immediate purchase. This meant that the public could get their hands on Sega's new console for the low, low price of $399, which would translate to about $620 today after being adjusted for inflation.

As exciting as I'm sure it was to realize you could purchase the Saturn right after its American announcement, not many people had $399.99 lying around to go and buy the system. If that wasn't discouraging enough, right after Sega's keynote, Sony announced that they would be selling the PlayStation for $299.99, meaning you could get a console with roughly the same capabilities as the Saturn for $100 less, though admittedly you would have to wait for a few months to get your hands on the PlayStation.

Even worse, the rushed launch meant there were only six games available for the Saturn from day one, and none of them had the name "Sonic" in their titles. If Nintendo had proven anything, it was that each new system in the 90s had to have a mascot platformer for the launch in order to be successful. Sony understood this, and so PlayStation owners were given Rayman. Sega on the other hand decided to forgo giving the masses a new Sonic game.

In short, there was no "killer app" to make the Saturn stand out. It was over-priced, it's launch titles were unmemorable, and there was no time for the all important "Hype Train" to gather steam before the console's launch. 

Nintendo and Sony both know how to build up steam on the Hype Train. Like, they are the masters of it. Don't believe me? Watch this.

When the Nintendo 64 was released in 1996 it spelled doom for the Saturn. At a price of only $199.99, the console not only offered better graphics than the Saturn, it was cheaper too. It did not take long for the doomed system to be slowly sucked into the blackhole of obscurity, and the console's abysmal performance put Sega on the precipice of financial ruin.

Enter the Dreamcast.

Cue the Angelic Choirs.

The system was meant to save Sega's failing console business. With a built in modem for online play, the innovative VMU device, which doubled as a memory unit and a second screen, the system was ahead of its time  when it launched in 1999.

At first things were looking up for Sega. The dreamcast sold incredibly well, and it seemed as if Sega's dark days were behind it.

Then came the PlayStation 2.

In march of 2000 the PlayStation 2 hit store shelves, and the masses went crazy for it. In addition to playing games, the system could also play DVDs. This was incredibly enticing as dedicated DVD players were incredibly expensive at the time. Sony had also emerged as the decided victor of the previous generation, outselling the N64 and Sega Saturn by a large margin. The momentum Sony had made it unstoppable, and sadly, the Dreamcast fell into the blackhole as its predecessor.

The Dreamcast had way too much lost ground to make up for. The Saturn had slowed Sega's inertia to a standstill and the Dreamcast didn't have enough time to get Sega moving again. That is why I feel Dreamcast is not to blame for Sega's departure from the console business. It had an impossible challenge to live up to, which is a real shame because the Dreamcast had some amazing titles.

At least Sega is still making fantastic games right?

Well...except for that one...

...or that one...


Ugh. Now I'm just depressed. What are your thoughts? Do miss the glory days of Sega? Let me know in the comments below!

Source: CNET