The Sega Saturn & Sega's Fall from Grace

rolling stones [Music] on october 29 1988 a company by the name of sega released a brand new console in japan the sega genesis which received positive praise on release didn't exactly blow up the market the sega genesis only managed to sell 400 000 units in its first year in japan and 500 000 units in north america where then ceo of sega of america michael katz was tasked with selling 1 million units however in 1990 tom kalinski was hired to revitalize sega of america introducing a new plan to sell the genesis by slashing prices having more aggressive advertising campaigns creating a new game development team and launching the soon to be hit game sonic the hedgehog kolinsky's plan for the sega genesis seemed to pay off as it started to outsell the super nintendo in north america thus allowing sega to not only control 65 of the 16-bit console market but also to become a household name with sega becoming a seemingly worthy opponent for nintendo the world eagerly awaited what would come next for the company beginning development around 1992 the sega saturn was set to be the hit follow-up to the sega genesis after forming a new partnership with hitachi sega and hitachi set out to create a new cpu for the project known as saturn initially the sega saturn was created to solely improve upon the world of 2d gaming however with the announcement of sony's new playstation sega seemed to shift focus to bring 3d capabilities to the sega saturn the chip that sega and hitachi set out to create was known as the super h risc engine or sh2 and it was created as a 32-bit chip using 16-bit instructions the sh-2 was used not only in the sega saturn but also the sega 32x allowing for the sega genesis to have 32-bit capabilities though both the sega saturn and the 32x used the hitachi sh2 in a dual configuration for both the main difference is that the saturn was equipped with two separate video display processors whereas the 32x only had the two sh2s what they are saying is that sega has spent the last nine months or so playing catch-up with sony after a publisher friend tipped sega off about the power of playstation new specs and development tools only recently arrived with third parties superseding sega's original description of the project the main difference between them is apparently the addition of more dedicated processors taking work away from the two cpus functionally the saturn was actually quite powerful considering it had two hitachi sh2s and two separate video displays aptly named vdp-1 and vdp-2 the saturn also has its own custom sound processor using a motorola 68ec00 as a sound controller the custom sound processor has an integrated yamaha fh1 digital sound processor inside capable of 32 sound channels with fm synthesis and 16-bit pcm sampling according to the saturn's overview manual the vdp1 is what handles the sprites textures and polygons whereas the vdb2 normally handles background rendering along with those processors it also has a dedicated hitachi sh1 used solely to reduce load times in tandem with the cd-rom using the vdb2 to not only create but manipulate the backgrounds and games has often been praised as a very important feature that coupled with how strong the vdp1 is for creating sprites allows for the look and feel of 3d environments without actually rendering these 3d environments like the nintendo 64 or playstation the issue however is that functionally developers had to figure out how to manipulate and take advantage of the dual cpu and dual vdp processors this made development for the saturn difficult for most developers unless they decided to really dig into the programming and take the time to optimize for the four separate processors in fact on paper the saturn could produce more textured polygons than the playstation 140 000 per second compared to 90 000 per second and a ton more sprites this was only theoretically possible if the vdp-1 and vdb2 were optimized to work in parallel to reduce the fill rate for vdp1 for example if the vdb2 only renders textured 3d infinite planes this allows the v2p1 to render other 3d assets the problem was getting all of the saturn's different processors to work together well to produce 3d games that however was not the only problem sega and the saturn were facing [Music] with the release of the 32x happening in november of 1994 in north america it was viewed by many to be a cheap add-on to extend the genesis life cycle in its last ditch effort to make more money off the console for developers it didn't make much sense to develop for the system since it was incompatible with the saturn along with that the launch of not only the saturn which was more capable and made by sega the playstation a much more compelling offer for people looking to the future of 3d and the rumored ultra 64 from nintendo were all on the way what makes the decision even more curious is the fact that the 32x hadn't even started to be developed until january of 1994 less than a year before the saturn's planned launch in japan at this point sega seemed to be making fools of themselves what was the point of launching a 32-bit add-on for the genesis when the saturn was slated to launch in about a year especially when not much was known about the saturn other than that it was using the same basic architecture that the 32x was minus the video display processors well to be honest there was no point really it all came down to different preferences of different countries in america the genesis was performing well laying claim to 55 of all 16-bit hardware sales in 1994 it was clear that with solid games and hard marketing the genesis was a favorite among american consumers in fact the genesis often outsold the super nintendo in a ratio of 2 to 1 many times during both systems lifetimes in japan however the situation was a bit bleaker of the total lifetime sales of the genesis the japanese market had only accounted for 3.58 million units comparing that to the super nintendo's 17.17 million units in japan it's no wonder why sega of japan was pushing a 32-bit system out the door so quickly they wanted something bigger something better and something to compete with the atari jaguar and best the super nintendo we were at ces 94 in las vegas and sega of america's head of r d joe miller asked a few of us to join him in his suite for a call he was expecting from nakayama there had already been some discussion about an up gun mega drive with hideki sato and his sega hardware team but the essence of the call was that we needed to respond to atari's jaguar and we needed to do it right away joe said he was confident the us team could come up with a design that would do the job so nakayama said get it done and we were off to the races scott bayless retro gamer number 77 to sega of japan this was an odd decision from their perspective the mega drive as it was called there and in the eu performed quite poorly there seemed to be no need to continue the genesis sport however nakayama took notice that the genesis was doing quite well in america so the decision was to get started on it in january of 94 and put it to market by the end of the year with the genesis sales still doing well in america and sega america believing the saturn would not launch in 94 the 32x seemed to be like a good bet issues began to rise early on the 32x was on a tight schedule and it didn't exactly help that the system used the sh-2 for its primary hardware this in turn caused shortages for the 32x since the saturn took priority sega of america was in a race against itself and sega of japan with the saturn not having a release date and the 32x in mid development sega of japan dropped a bombshell [Music] the saturn got its launch date november 1994 in japan not surprisingly word got out quickly in the west u.s and eu consumers immediately started asking the obvious question why should i buy a 32x when the saturn is only a few months away the answer to that question was that the 32x was a transitional device made for the people who did not want to shell out the money for a brand new console to many consumers however this was not an adequate response it seemed like an obvious cash grab to try and squeeze any life out of the genesis that they could obviously to sega of america they were simply trying to extend the life of the genesis since it was doing really well similar to what nintendo of america did with the super nintendo allowing for the super fx chip in star fox and new technological techniques used in donkey kong country to extend the life of the console through the 32-bit era nintendo decided to push through with the snes until the ultra 64 was ready for launch sega however wanted to compete head-on with atari and other 32-bit systems with the decision to launch the saturn so soon in japan this obviously put sega of america in a tough spot along with the tension growing from that end the 32x and saturn now had to compete for parts with sega of japan primarily making the decisions the saturn was given priority unfortunately for both regions the release date for both systems was rapidly approaching releasing november 22 1994 at the low price of 44 800 yen the saturn sold out in its first day launching with the hit title virtual fighter an arcade game originally developed by sega's am2 team for the sega model 1 arcade the saturn seemed to be no slouch though sega of japan wanted to have two other games at launch clockwork night and the cult hit panzer dragoon they unfortunately didn't make it that made virtual fighter and wan chai connection the only titles to launch with the saturn in japan granted virtua fighter was a huge hit in japan with incredible 3d graphics and a solid counterpart to the arcade version virtua fighter helped sell all 200 000 of the saturn's initial shipment sega decided to not immediately restock and instead wait until december 3rd the same day as the sony playstation launch surprisingly the saturn proved more popular with sega of america launching the 32x only a day before the saturn launch in japan and oddly enough the 32x even launched the same day as the playstation and the restock of the saturn december 3rd in japan at half the price of a saturn the 32x was fairly popular during the holiday season however interest in the console add-on quickly subsided by the end of 1994 sega had managed to sell 500 000 units of the saturn whereas playstation had only managed to sell 300 000 considering these it seems like the saturn was going to be more popular however both sega and sony had their eyes on something greater america tom kalinski ceo of sega of america announced in march that the saturn would release on saturn day september 2nd 1995 and unfortunately sega of japan had a different idea they mandated an early launch wanting every advantage they could get over the playstation so at the very first electronic entertainment expo e3 for short sega of america and sony were there to announce more information on the us release of both of their hit consoles first up was kolinsky and sega of america sega's press conference was slated for may 11 1995 and on that day sega had officially died losing the console wars not only to nintendo but also sony kalinski took the stage and revealed two bombs about the sega saturn a launch price of 399 which adjusted for inflation would be 685 dollars in today's money though to be fair the saturn would include the hit game virtual fighter with the console either way at that time a console priced at 400 meant it probably wasn't going to get too far but wait there's more kalinski also revealed that sega had already shipped 30 000 saturns to toys r us babbage's electronics boutique and software etc for get this immediate release with no announcements set to walmart best buy and many more retailers said retailers were quite upset in fact kb toys a huge toy store back in the day decided to drop sega from its lineup altogether following the disaster that was sega of america's first e3 came sony's first e3 [Music] during the presentation the worst thing that could have happened to the saturn came to fruition [Applause] 299 [Music] the price heard around the world steve race the current head of sony interactive entertainment calmly walked on stage shoveled some papers and dropped the biggest blow to sega and then just walked off stage now the saturn still had the advantage of launching early thanks to sega of japan right well surprise surprise but the saturn had a few other issues with it other than launching about four months early unlike in japan virtual fighter wasn't a system seller in america also the launch lineup wasn't the greatest including clockwork night daytona usa panzer dragoon pebble beach golflings virtual fighter and worldwide soccer sega international victory gold edition unfortunately none of these were able to set america on fire though i think it should be said that not every console has to have a ton of games maybe it's about quality as far as games go all other third party releases for the saturn were set to release around the original launch date meanwhile over on sony's side of things they had ridge racer ready to roll ridge racer was viewed by many as a very high quality port of a great arcade game whereas the saturn's daytona usa was viewed as inferior to its arcade counterpart the playstation also had tekken without a month of launch with more detailed textures and twice the frame rate tekken became more popular than virtual fighter unable to capitalize on the early launch the playstation was able to outsell the saturn within the first two days of its launch [Music] with the playstation outselling the saturn so quickly sega knew something needed to change on october 2nd 1995 they announced a price drop to 299 putting it on equal footing as the playstation along with that sega ported sego rally championship virtua cop and virtual fighter all by the end of the year all of these were regarded as higher quality than the offerings that sony had and did in fact lead to an increase in saturn sales though for sega it simply wasn't enough by 1996 the playstation had a much larger library than the saturn due to how easy it was to develop for sony was doing a great job attracting third party devs to their system offering a 10 licensing fee incredible development tools to make it easy to make games and a 7 to 10 day order system for cds the saturn was notoriously difficult to develop for due to its odd setup of processors and its lack of general simple tools where's sonic was the question on the mind of every sega fan in order to drum up hype for the saturn sega decided to use sonic team's newest game knights into dreams instead of pushing their strongest franchise meanwhile a group of employees formed sti to create a new sonic game that never saw the light of day sonic xtreme while not much is known about the cancelled sonic game the original prototypes had a fisheye lens and it was more 2.5 d than fully 3d like would be realized in sonic adventure or mario 64. like everything saturn related the project eventually died a slow and painful death after wasn't allowed to use the knights engine and two designers became ill while working on it eventually sonic team decided to pick up development of a 3d sonic for the saturn but development was shifted to the dreamcast before a sonic game ever came out on the saturn by the end of 1995 the playstation would go on to sell eight hundred thousand units in america whereas the saturn would sell only four hundred thousand because of this the man who seemingly made sega the powerhouse it was in america tom kalinski decided to leave sega of america on july 16th 1996 sega announced that shoichiro ira majiri was now the chairman and ceo of sega of america kolinsky would subsequently leave the company on september 30th of that year at e3 may 1996 sony started off by announcing a price drop to 199 for the playstation of course in an attempt to stay in the race sega also announced that the saturn would drop to 199 despite how expensive it was to make during christmas of 1996 sega released the three free pack which included daytona usa virtual fighter 2 and virtua cop all with a brand new sega saturn this allowed the saturn to try to stay in the race into 1997 but by the end of 96 the playstation had doubled its sales with it selling 2.9 million compared to the saturn's 1.2 million things were not looking good the playstation's dominance coupled with the launch of the nintendo 64 in 1996 proved to be the end of the saturn by 1997 with the release of the critically acclaimed final fantasy 7 boosting popularity in japan and its continued popularity in america the playstation would outsell the saturn by three to one in america by august of 1997 sony had control of 47 percent of the console market nintendo sat at a pretty 40 percent and sega had only 12 percent of the market a hard fall from grace for a company that seemed to have it all at the end of the fiscal year ending march 31st 1998 sega suffered its first losses since 1988. after steadily declining profits since 1993 they posted a net loss of 327.8 million dollars and a consolidated net loss of 269.8 million dollars shortly after announcing its losses sega confirmed that the saturn would be discontinued in north america the total sales for the saturn would eventually end up being as follows 5.75 million units in japan 1.8 million units in the united states 1 million units in europe and 530 000 units elsewhere for a total of 9.26 million units in lifetime sales for comparison that's about 4 million less than the wii u nintendo's biggest failure since the virtual boy while the sega saturn was a commercial failure its legacy remains the saturn was a fairly powerful console with great games and solid arcade ports and while it was difficult to develop for it was ultimately sega's miscommunication and mismanagement that led to the saturn's failure this battle of power between sega of japan and sega of america would ultimately lead to the downfall of sega as a company coming off of one of the hottest consoles of all time with the sega genesis it was very confusing for consumers and historian alike as to why sega felt the need to launch the 32x so close to the launch of the saturn and why did sega of japan feel the need to alienate retailers and gamers by having an early launch that led to subpar games and a weak american launch the world may never know to summon up bernie stollard the former president of saga of america appointed after kalinski had this to say about the saturn i thought the saturn was a mistake as far as hardware was concerned the games were obviously terrific but the hardware just wasn't there could a 3d sonic game have saved the saturn in all reality probably not why do i say this well sega didn't leave the console industry after the saturn they decided to give it one final go with the dreamcast with it came a mind-blowing new 3d sonic game yet as we all know sega doesn't make consoles anymore so what exactly happened with the dreamcast you'll have to wait and see [Music] you

Channel: Video Game Docs

Views: 17,188

Keywords: Gaming, Genesis, Nintendo, PlayStation, PlayStation 2, Saturn, Sega, Sega 32X, Sega Genesis, Sega Saturn, Sonic, Sony, Video Game History, Video Games, gamecube games, sega consoles, sega documentary, why sega failed

Id: 9XPgfOewvlE

Length: 22min 35sec (1355 seconds)

Published: Sat Feb 27 2021