What killed the Dreamcast?

During the early part of the 90's, Sega was one of the biggest video game companies in the world, and the sole company that could realistically challenge Nintendo's practical monopoly on the home console market. The Sega Genesis was the second best selling console on the market, trouncing machines like the Panasonic 3DO, the Phillips CDi, and the Atari Jaguar. In the year 1999 and Sega had launched its greatest console yet: the Sega Dreamcast. This console was nothing short of a gamer's dream. It was a system that focused on gaming, bringing out high speed, three dimensional gaming. It launched with several fantastic games, like Sonic Adventure and Power Stone. It was THE hot commodity of Christmas 1999. A year later, the Dreamcast was discontinued. What the hell happened? Let's find out.

First off, we need to take a history lesson. In the year 1989, Sega released its console, the Sega Genesis, to compete with the then biggest console of the market, the Nintendo Entertainment System. Their marketing campaign turned out to be not only extremely memorable, but also became one of the cornerstones to the most memorable Console War in gaming history. Sega's slogan? "Sega does what Nintendon't" Nintendo, however, did not take this sitting down, releasing their own new system, the Super Nintendo Entertainment System.

Pictured: Two of the greatest game consoles ever made. Left is the Genesis, right is the SNES

The SNES didn't start off that well, but it had two advantages: brand recognition and legacy. Nintendo was the company, after all, that pretty much single handed revived the video game industry in North America. With a little time, the Super Nintendo was gaining ground on the Genesis, eventually surpassing it on the North America market (in Europe and Brazil, where the Genesis was called the Mega Drive, said console was the dominant one, however.)  The SNES was a superior machine to the Genesis. It was stronger, it had better music capabilities, and it even allowed (very limited) 3D graphics. To compete with this, Sega released an add on accessory that would allow the Genesis to play CD-ROM games. This accessory was called the Sega CD.

The main advantage CD-ROM's had to cartridge technology was that the CD could hold more data, allowing for things like voice acting and animation to be included in the game. The idea was fantastic on paper. But the problem was that, aside from the fact that the Sega CD needed a Sega Genesis to work as well as a third power receptor to be plugged in, most games on the Sega CD were, well, trash. Back during the days of the Sega CD, Full Motion Video, which was when actors would act out scenes in a video game like it were a film, was all the rage. And wouldn't you know it? Most Sega CD games were FMV games too! So while the Sega CD had great games like Lunar Silver Star and Sonic CD (considered one of the best Sonic games ever), the Sega CD had big stinkers, like Night Trap and Make my Video.

Yes, FMV games looked like this.

The Sega CD was very, very expensive. It launched with a price of $299. Two hundred and ninety nine dollars! And I still needed a Genesis to play it! The Sega Genesis itself launched for $189.00! What the hell?

Ah, but it didn't end there. Sega had delayed lending the technology to third party developers (you know, the pillar needed for a console to succeed?) so most few companies could actually even make games for the Sega CD. A console's life is 100% dependent to the games one can play on it. Even if the main company can produce several quality games, it still needs third party developers to make games for the console, so that the consumer can have a wide variety of products to choose and buy. The Sega CD had potential, and a lower price and higher variety of games would have probably saved it...

...unlike Sega's OTHER add on for the Genesis, the 32X. The 32X was a huge mistake. The system was released the year before Sega's next big console, the Sega Saturn, so that already pretty much hurt the add on from the get go. The 32X was meant for two things. The first, extend the life of the Genesis a little more. The second, to provide gamers a cheap alternative to play 32 bit games.

The 32X is that mushroom thing that's attached to the Sega Genesis. My God, it even looks awful!

You needed to plug the 32X in an independent socket. So, let's see here, you needed to plug in the TV, the Genesis, AND the 32X...and that's not forgetting that some 32X games ALSO needed the Sega CD in order to work properly! So you needed four electric sockets JUST to play the 32X! And just so you know, to play the SNES, you only needed 2 sockets! The Sega Saturn needed only two sockets! So, how in the world could anyone think the 32X was going to be a good 'cheap alternative'? Oh! And the 32X costed a mere $159 at launch! The Ouya, an independent system that was launched in 2013, costs only $99, has stronger RAM, and does not need four sockets to work. I want you to think about that, think long and hard.

Coming this fall, MTV's latest reality series, Pimp my Genesis! With your host, Xzibit!

The abysmal failure of the 32X, combined with the relative failure of the Sega CD, would be a blow from which Sega would never recover from. The tragedy of it all is that, in spite of Sega's best efforts, the Sega Genesis would end up outsold by its main competitor, the SNES, though the competition was fierce. To this day, no other Console War has made such an impact on gaming culture.

In the year 1995, Sega released their entry for the Fifth Generation of gaming consoles, the Sega Saturn. Sadly, the Fifth Generation also saw the rise of a new giant in gaming: Sony. Sony released its own console, the Playstation, eventually taking the lead in the gaming market. What did Sony do? Sony did the opposite of Sega, allowing third party games to define the system. Squaresoft abandoned Nintendo, which opted to continue using the less powerful cartridge technology with their next console, the Nintendo 64, and continued their Final Fantasy series for the Playstation, starting off with one of the biggest selling games of all time, Final Fantasy 7. When Sony entered the market, Sega was facing not only a new competitor, but a strong one too. So strong, in fact, that Nintendo was dethroned from its position as the strongest gaming company on the market. The Playstation outsold the Saturn and the N64.

This was bad news for Sega. The poor sales for the Saturn meant that, if they were to stay in the business, their next console needed to be the Number 1 seller. Sega looked back, learned from their mistakes, and released one of the greatest consoles ever made. This one had everything. Online play! Full 128 bit graphics! Killer music! Doubled as a CD player! Fantastic games! A brand new, 3D Sonic the Hedgehog game, with full voice work! Fighting games! Sports games! RPG's! Survival horrors! Perfect arcade ports! Racing Games! It was a dream! No...

...it was the Dreamcast!

But alas. The damage was done. Although the Dreamcast had potential, and Sega had pulled out all the stops, even starting many new franchises on the system (Samba de Amigo, Shenmue, Jet Set Radio, Space Channel 5), the system itself lasted a year and a half. Why? Because most gamers that had any sense were holding out for the Playstation 2. Gaming companies were making games for the Playstation 2, the system that was a guaranteed seller. The moment the PS2 arrived, Sega was done. There was simply no way Sega could compete now with Nintendo and Sony, and even less now that Microsoft had entered the gaming market with their Xbox. Simply put, if Sega had continued fighting the console wars, it'd be fighting with Nintendo for a chance to be the third best seller. Sega was stuck with several warehouses of unsold Dreamcasts, and the best systems on the market didn't just play CD's, they also doubled as DVD players. Sega had no choice. By January of 2001, the Sega Dreamcast was officially discontinued. Games for the console were officially released until 2002.

What killed the Dreamcast? Sega and Sony did. Sega shot itself in the foot with the 32X, alienating third party developers and gamers with their lack of foresight. Then Sony delivered their coup de grace by trouncing both Sega and Nintendo on the market, removing Nintendo from its spot as the top video game console maker, and Sega as the one company that could compete with Nintendo. Although Sega is still around, releasing games for their former competitor's consoles, their days as one of the biggest game companies in the world are long over.