The Dreamcast - What Happened?

[Music] so it's been about like a few weeks since the last video about Sega so here's another one welcome to what happened the show where we discussed various video game and movies in a frank and professional manner and thanks to flop house VIP member C 2 for you we are now adding entire video game consoles to our ever-growing list of clientele oh yes as the thumbnail so subtly hinted we are taking a look at the Sega Dreamcast the perennial most underrated console of all time Grand Slam winner the wall had a lot of positives also has the dubious distinction of being what caused Sega to leave the hardware business but did it yes but did it really no well let's dispel that confusion and really dive into the Dreamcast really find out what makes it tick and most importantly what it's thinking now if you're a younger gamer you might know Sega as the company that puts out games with either Sonic or carry you on the cover maybe a total war here and there and sells the same 30 roms every couple of months but they have a long lasting almost 60-year history that for the purposes of this story we'll need to briefly touch upon the Master System Sega's answer to Nintendo's 8-bit machine didn't do all that well in Japan but had an encouraging start in both Europe and the US although not nearly enough to make a dent in the mid 80s Nintendo mination it wasn't until the sleek-looking Genesis / Mega Drive a system that greatly outperformed the NES the Sega started to make some serious headway in the console market but it wasn't really until Sonic the Hedgehog sped into stores in 1991 where that headway started to become a credible lead Sega has never recaptured the success of Jenny Drive selling almost 50 million units worldwide with a Dreamcast unfortunately coming up the shortest and matching that number now what why is that well let's find out the runaway success of the blue blur along with some great arcade ports and sports titles were squandered when instead of letting the Genesis simply phase out and pipe the upcoming Saturn in late 1992 they decided to prop up the Genesis with its first add-on rather than focusing on additional chips and new graphical techniques like Nintendo was exploring thus the Sega CD was born and everyone was asked the eternal question hey you still don't have a Sega CD no the former head of Sega Europe Mike Brogan in an interview with Eurogamer puts it simply add-on devices don't increase market share by their very nature they sell into the existing customer base only Sega's thought here was that the Genesis would continue to be their main stream console for years to come and wanted to sell additional add-ons for it while the Sega Saturn would be their big elite sort of option that they would market to the hardcore that was the initial thought at least because that mainstream existing customer base wasn't all that into the Sega CD funnily enough it was a cheap slow consumer grade CD drive that mostly resulted in grainy game playlists FMV titles while more traditional ones like safe Mortal Kombat CD were barely approved upon over the Genesis versions one of the few highlights was of course Sonic CD but the price of the add-on 299 dollars at launch limited the amount of people who couldn't even play it and finally despite all those cost-saving measures Sega still sold the CD unit at a loss something the company did fairly regularly but whatever Sega can take a few hits the Genesis and Sonic will carry them through now since the site was taking a while to come out in the u.s. which just so happened to be Sega's biggest market they felt they needed another product in the meantime since Genesis sales started to slow this of course resulted in the legendary 32x which is originally pitched to be its own standalone console the Neptune before Sega decided to make a very last-minute pivot since its only reason to exist was to kill time until the Saturn launch it was decided that building another standalone console would just be too expensive for a stopgap system therefore on but why even really do this to begin with former Sega of America employee Scott Bayless was right on the front lines the 32x was born in a call from sega japan president Hayao Nakayama to Sega of America's R&D head Joe Miller he was on a speakerphone and there were several of us in Joe's suite at CES in Vegas mister Nakayama basically said that we had to do something about Ataris forthcoming 64-bit jaguar console he was worried about it okay let's let's take a minute here breathe in and read that last line again we have to do something about the Atari Jaguar so when you are born of an idea as stupid as that it's no surprise the 32x was an even bigger failure than the Sega CD lasting only six months on the market and aside from some competent ports like Virtua Fighter and doom it had very little to offer Bayliss again cuts to the core of Sega's problems around this time where it started to go sideways was an implementation by the time it got to market the 32x had been pared down significantly for cost reasons but that reduction severely impaired its functionality leaving it in a weird uncompetitive space versus other devices that were looming on the horizon I think the decision to respond to the Jaguar was symptomatic of that pervasive lack of direction that lay below the surface at Sega without a clear vision we were just reacting but Sega can take a few hits the Saturn is coming out and sonic will see them through right unfortunately dudu yeah all this Sega lost a lot of goodwill from fans around this time and because of all the impending competition the Saturn was already put in a difficult position Sega also miscalculated when designing the Saturn and thought sprite scaling was the future rather than full 3d and thus built the Saturn around that philosophy however the competition had bet big on 3d for their respective machines and when compared side-by-side with the Saturn Sega's new console looked a little unimpressive there was more than that though the botched and hurried North American launch the loss of several big third-party games the lack of a mainline Sonic title competition from Nintendo and for a bevy of other reasons hadn't failed to achieve the same success as the mega Genesis not even shifting 10 million consoles worldwide with a lifespan of roughly four years Sega couldn't take any more hits like that they needed to knock it out of the park with their next console so they decided to make one more big play to place all their hopes and financial future on a dream in 1997 Sega of Japan test two teams to make the Dreamcast architecture then titled project katana as so much cooler name with both teams who weren't even aware of each other being on opposite ends of the world one team focused on American technology and entered a contract with 3dfx to use their chipset as the base while the Japanese team favored a Hitachi CPU architecture instead now here's where things get interesting hey here's that what happened you ordered while many reasons can be cited as to why the Dreamcast ultimately failed to save the company with most of them being pretty overt the competent from the ps2 the fans they lost due to the add-ons and Sonic's waning popularity there's also many behind-the-scenes reasons that helped as well 3dfx in the mid to late 90s was gaining traction for their chipsets which powered awesome arcade hits like san francisco rush when Gretzky's 3d hockey and of course mace the Dark Age thus the company went public and when that happened they let slip that they were providing chips for Sega's next machine which wasn't even announced yet prompting Sega to go the Japanese office were furious with this leak and thus severed their contract with the chip maker due to this injustice despite the 3dfx architecture being the technically superior design 3dfx for their part sued Sega for this breach of contract and they eventually settled out of court it's not publicly known how much Sega had to pay due to all this but things are obviously getting rough for the Dreamcast and the [ __ ] thing wasn't even fully designed yet obviously due to all these legal sees Sega Japan went with the Hitachi architecture in lieu of the more powerful 3d effects version with the specs long Sega started courting various publishers to start making games for the cast of Dreams but things unfortunately went sideways of one of their longtime partners say what you want about EA nowadays believe me I do but in the 90s they were well respected and supported the hell out of Sega's past consoles however Electronic Arts were also fans of 3d FX and it even invested in the company so when they saw the Dreamcast specs they were skeptical and ultimately passed on supporting the machine according to EA exact bing gordyn if Sega had picked the direct competitor to 3d FX at the time it would have been fine but they picked someone we had never even heard of it was somebody's friend of somebody's friend at a Japanese Country Club it was a head scratcher like what are they doing that was mostly it because of this now missing chunk in their gaming portfolio of sports titles who were a must Sega had to spend their own money to establish the 2k sports brand and while this was certainly costly the rise of a competitive alternative to EA is seen as a milestone within the gaming industry wallet yeah would have been easier for EA to have simply supported the system from the get-go the long-standing effects of this decision or monumental the rest of the Dreamcast core design and features were a classic example of ticking all the boxes for controller ports to combat the n64 higher capacity disks to rival the PlayStation Internet connectivity at a cable at the bottom of the controller for some reason and of course the crown jewel the VM yo also where as Sega's last few machines were lagging behind in the power department the Dreamcast shined here in pretty much all regards but the problem here was the timing the console was designed to beat the PlayStation and the n64 and wasn't exactly concerned with the future which always seemed to be a problem at Sega it landed in the US Sega's biggest market on $99.99 remember that yeah well all Sega fans remember that and make sure to bring it up every single September although Sega's hard work and money spending did result in one of the best launch lineups up until that point and some would say of all time Soul Calibur Hydro Thunder NFL 2k power stone House of the Dead 2 and yes Sonic Adventure the consoles big marquee title even Sony was nervous enough about the launch that they purposely positioned the US version of Final Fantasy 8 to come out that exact same day people were excited and the sales at first were very brisk with Sega touting it as the best console launch of all time in terms of profit over 130 million dollars were made in the launch week alone unfortunately as I meant before Sega had a habit of launching and selling things at a loss that's no good so it won't surprise some to know that Sega had spent far more than that launch week a profit just bringing the Dreamcast to market they needed to sell even more games and to sell them very quickly to start recouping costs now within just a few short months the Dreamcast's front-loaded library gave way to more and more arcade ports which around this time are becoming less attractive to gamers you can't build a varied library when a massive chunk of your titles were built around quick quarter munching experiences you also need longer more nuanced products as well there were a few big gets and exclusives though like Resident Evil CV quake 3 and Skies of Arcadia but as good as those were it just wasn't enough very very quickly Sega could see that the console was already flagging due to the low attach rate many people bought Sonic but not much else while the lack of variety in the library was a problem there was also the fact that many people were simply waiting for the mighty PlayStation 2 to arrive something Sega hadn't really planned on to hopefully fix all this they decided they needed something new something immersive a killer app that would turn heads and make people go alright the Dreamcast that game was uses ookies Shenmue Suzuki is often seen as Sega's Miyamoto creating so many classic franchises for the company it just boggles the mind Virtua Fighter is obviously one of the most prolific and speaking of which that's what Shenmue began as Virtua Fighter RPG for the Saturn before was moved to the Dreamcast and greatly greatly expanded upon and conversely was greatly greatly splurged upon Sega invested fifty million dollars and some have estimated far more to produce Shenmue for the Dreamcast the most expensive game of its day and it really was the first of its kind an example where video games could be a massive sprawling cinematic open-world game where the player could do pretty much anything they wanted well within certain restrictions of course years ago I was Chinese is that so many aspects of modern video gaming Oh a lot to the innovations and freedom Shenmue pioneered but the last thing Sega should have been doing right then was spending more money they barely had despite its selling well when it hit stores in early November of 2000 Shenmue didn't really improve Dreamcast sales nor did it increase the consoles attached rate and certainly didn't stop the record-setting launch of the ps2 which occurred only a few weeks before the thunderous hype of Sony's console sequel its graphical edge over the Dreamcast and the support of publishers like Square and Electronic Arts is certainly viewed as the death nail in the death coffin of the death cast what also didn't help was the Japanese economy having plunged into recession in 2000 which for Sega to really look at themselves and make some hard decisions now something I did not know before researching for this video that this was for a little while going to be the very real end of Sega like in totality on January 31st 2001 Sega announced they were ceasing production of their current console and a simultaneous Rohr disapproval and regret from Sega kids was heard from the stratosphere along with this announcement Sega also outlined their plans to focus on software and that you'd see their games release on other machines within the next year but things could have gone very differently because unbeknownst to many Sega was almost bankrupt what no money the only reason the company still exists today is because of the generosity of just one man the company that owned a majority stake in Sega was CSK holdings and chairman SiO Okawa was the boss people expected him to give the order for Sega to be shut down in the was clearly on the wall in 2000 but instead he loans Sega 500 million of his own money to pay off their outstanding debts and going above and beyond he then waved that loan on his deathbed two years later when he did pass away due to cancer he gifted Sega back his own personal shares totaling 695 million which is what made it possible for a second to even turn into a publisher in the first place you can't just go between being a hardware and then software company overnight need a lot of capital to make that transition capital Sega didn't even have with that huge cash injection though we saw Sonic on Nintendo console Shenmue 2 as an Xbox exclusive in the West and Virtua Fighter on the ps2 which years before would have been seen as sheer heretical lunacy since then Sega has had your proverbial dizzying highs terrifying lows and creamy middles and overall seems to be doing okay now I mean hell every September Stan say they swear a Dreamcast 2 is in the works despite Sega insisting they are a software publisher first and foremost further proving that the dream is indeed over well that was a crazy one thanks to c24 you for nominating the subject of this episode and if you're watching this right now we'd like to put forward what you want to see on the next what happened either video game movie or other head on over to the flop house VIP patreon and make your voice known see you next time Sega kids and thanks for watching [Music] you [Music]

Channel: Matt McMuscles

Views: 530,009

Rating: 4.9409566 out of 5

Keywords: Sega, Dreamcast, Sega Genesis, Sega Saturn, What Happened?, Wha Happun, Video game documentaries, Matt McMuscles, Video Game Disasters, Sonic The Hedgehog

Id: dY8kTDWMtTY

Length: 19min 10sec (1150 seconds)

Published: Tue Apr 28 2020

Reddit Comments

[u/Lieutenant-America]

Man, I had no idea about Isao Okawa. What a nice-sounding guy.

[u/Flare3500]

Man that clip Matt showed during the PS2 Launch , that's pretty crazy for a console I was so unaware at the time

[u/HGH93]

The Playstation 2.

[u/NorrisOBE]

All Dreamcast had to do was to offer DVD from the start.

They Know. They Did Know. They Refused. And it fucked The Dreamcast over.

[u/The_Draigg]

As a proud Dreamcast owner, I thought I was tough enough to not be saddened by this video. I guess I was wrong. The Dreamcast deserves life, damn it!

[u/JameTrain]

Huh, TIL the Saturn outsold the Dreamcast.

WEIRD :o