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A record of Segas reactions, mistakes, missteps, poor or misguided decisions, JUST in 1996.

Before we go into the documentation context is needed. Many people know Sega ended up failing for various reasons, however before the Dreamcast was even launched Sega was already in the hole, and Sega was in no position to launch the Dreamcast itself until a influx of money from outside helped, along with partnerships, Sega was basically a zombie company or near one at that point before receiving that uplift. Before Jan 1996, Sega made a few flubs, they gutted the 32X early and were about to kill it off, yet still kept being stubborn about killing the Sega/MegaCD, the Saturn launch had it's own issues, however that would not be obvious yet especially for long-term consequences, their marketing strategies were mostly detrimental, they were basically doing the opposite of what they did with the Genesis, and they were not utilizing staff the same way with the Saturn as they utilized them with the Genesis. This applies everywhere btw, except Japan.

However, almost all the things people say Sega did in this era to cause their fall, that would also sabotage their last gamble (Dreamcast), as well as myths/rumors all were not happening yet in early 1996. the documentation below which I will show with breakdowns in chronological order (by month) will showcase that Sega at Jan 1996 (outside of Japan especially US) was actually not in any notable danger of anything, they were only just starting to flub Genesis in 1994 regarding support, which resulted in interest in the console dying compared to the extended life of the SNES. 1996 will show them further screwing that up for the last time, but at the start of the year there was no such belief that the Genesis would be a liability and it was thought it would be an entry level system for Saturn owners.

The Saturn also, at the start of 1996 was not far from PS sales in a few European countries and the US, The press that was iffy on the Saturn was a minority early in the year, as Segas announcements were anticipated at the start of 1996, there was no expectation of Sega "failing" even from Sega themselves, they hadn't started acting like they had the money of Sony or Nintendo's reserves, and were at worst acting like a slightly ahead of themselves market leader, in fact Sega was still the market leader in the US in jan 1996, with Sony right behind, so pretty much nothing that most people would say about the Saturn, or long-term consequences of earlier decisions, haven't happened yet, especially since the latter only came to prominence due to mistakes Sega made in 1996 enabling those consequences to fester, and quickly. Sega itself while having taken a few scratches, was still sitting in cash from peak genesis and some other areas like arcades.

I would like to put in context as well, that in the US the Saturn and the PSX both launched in late holiday sales period 1995, so we are only a few months from launch in Jan 1996, and this is important for context for the reports below. The documentation below aims to show that Segas downfall was primarily due to a cumulative number of Sega's actions done almost entirely just in 1996, and it's important also for context, that Sega's actual value in money was maybe in Jan 1996 only 2.5-3x more than the 3DO company value at it's peak, which needed help to launch their console in 1993 due to the costs involved. So keep this in mind when looking at documentation later in the year when Sega acts like they are high rollers like Sony when they actually don't have the cash, in some cases likely using credit and/or loans, or partnerships.

Now then let us begin. Articles will be in quotes to reduce clutter

JANUARY 1996

Miami Herald Jan 18 1996.

Already we start off the year with Sega in talks with Panasonic/Matsushita on creating a DVD related consumer device. Included is the mention of complex games DVD could provide, including better quality FMV and sounds. Of course, this never went anywhere and the money spend on exploration was pointless, in fact, Sega would drop out of the console market before they's even touch DVD for games, years after this.


Oakland Tribute Jan 14th 1996

Here we have Sega in Jan 1996 still the market leader in the US, with Nintendo pretty close behind, a fast approaching Sony, and a pre-desperation sale 3DO in the rear. This is going to change drastically throughout the year.



Elpaso Herald Jan 2 1996)

This is a summary of an issue regarding Sega firing/laying off staff who are slow to adopt or refuse to adopt some elements of modern computing in their lives. This is in japan and will end up having a long-term consequence for the company there later, as several of these staff could've been helpful in operations once Sega's initial success there starts rapidly declining.



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FEBUARY 1996
Orlando Sentinel Feb 21

Lockheed Martin has formed Real-3D to carry on an expensive joint venture that was already on-gong over at Sega, which would result in the costly but impressive Model 3 Arcade board and games.



National Post Feb 28th 1996

Ok, so things are starting to become clearer now about Sega's back end. Sega takes a $340 million loss due to issues and restructuring/shrinking of their European operations. Reducing the countries it deals with directly with middle-men for the others. They also mention unrelated separate losses in the millions. Sega is pivoting to focusing on "games" and SEGAWORLD. Which is interesting because Sega had always presented itself as always focusing on games so this messaging is quite interesting. There's also losses from the US involving inventory, and Sony is picking up steam WW over Sega. Also, Sega starts the Genesis blame game here which it uses as an excuse for losses throughout the year even though it's not the primary cause, or even half the cause, of most of the upcoming losses. But we'll get to that gaslighting strategy later.



National Post Feb 7th 1996

Sega is partnering with IMAX to install theaters at two of Segas high-tech "amusement parks" in this report. It's a small snippet but it all adds up to produce the full picture. It will actually be foreshadowing stuff that's going to happen later so keep this in mind.



San Francisco Examiner Feb 16th

Now some people here will likely know what this internet product will become. To keep things in context though I won't actually name the device until an article does later on. But this is the first major look at Sega's "internet TV" plans for the Saturn, and as things get worse for Sega it becomes a "plan" that Sega hopes will raise adoption of the Saturn console. It still comes out this year, but keep this article in mind as right now Sega is announcing this product with no name, and it will become apparent later that they also have no plan. At this moment the device is actually in development, there is however NO SOFTWARE being prepared for it yet. This is despite the fact Sega is basically telling you that the whole point of this device outside browsing is to play games with it. More money down the drain, keep this in mind.



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MARCH 1996

Daily news March 4th 1996.

So Sega along with Dreamworks, Spielberg, SKG, and MCA are in a partnership to open 100 entertainment centers in 4 years. Or at least that's what they planned to happen. But it doesn't work out that way.


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APRIL 1996

San Francisco Examiner April 18th 1996

So here we have Sega cutting their relationship with a company that helped Sega get to be as big as they "were" with no replacement agency planned to help Sega market their products on TV. On first glance of this article, you may think Sega is playing the blame game, instead of focusing on issues caused by themselves, and on that note you would be right.




Province April 26th 1996

So the Sega Nomad is here. Game gear is still on sale btw and marketed. $200, expensive, and Sega is as the article states not doing much marketing for it yet because they don't want to overlap with their GG push. Of course even after GG continues to decline to it's death they still only marginally pick up the marketing. Not the smartest sales plan out there.

Also, I never liked how the carts stuck out like that.



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MAY 1996

News Tribune May 18th 1996

So the announcement of VF3 coming to the Saturn is hilarious looking back at this, but we have here the mention of the then upcoming game "NIghts" and it coming with the Saturn Analog controller. However, Sega don't seem interested it including it with SATURNS for some reason. We also get the Net Link name drop for that internet device mentioned earlier still being invested in.



The Missoulian May 20th 1996

So a few things with this article. For one, Sega is not and never has been in any position to have a price cut war with Sony. Sega had at least 3-4 price cuts alone in 1996. 2nd, don't let these sales fool you that these two are close. Sega's sales in Japan is what's making these numbers "seem' even, and that's about to drop off with Sony picking up pretty much everywhere else.

We have a little but more detail on Netlink but not much. Notice that they still don't mention software for it. But there's the issue that seems to not phase Sega at all, that a person who actually wants their internet TV service, has to at minimum pay $50 more than what the original unsellable price of the Saturn was, which Sega than cut to be closer to PS, which also forced 3DO to cut from $400 to match PS, then not long after $50 below PS earlier this year. Not the price point of even modest adoption.

Clarion Ledger May 18th 1996

So Sega was supposed to come out in 1994 with the Saturn in the US which didn't happen, and therefore it was delayed until 1995. Apparently this delay which oddly matched the PlayStation US release date window, caused a 15% decline in profits. Sega lost near $40 million In their fiscal year ending in march. So clearly. the best thing to do at the time of losing money is to of course, cut the price, again, of your expensive top of the line consumer electronic product by $50 because.......

By now you're probably starting to realize, if you hadn't before, that Sega doesn't make any sense.


Sault Star May 18th 1996

This is just a repeat of the last one, I just find it curious how Sega is blaming a "later release" on its losses, yet was touting victory when it was slightly ahead of PS in 1995, which released near the same time. Something doesn't add up Sega,

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JUNE 1996

The Age June 26th 1996

So we are in June now, half-way through the year, and Sega is currently giving strong hints they aren't confident in the Saturn. They are already preparing computer games for PC due to the growth in the market, and the anticipation it will impact console sales (it won't).

Also notice the Nintendo director believing that if PC gaming continues to take off Nintendo may as well quit. Turns out he was wrong too. Already at this point the CD-rom is near standard on PCs and nothing was happening then, yet for some reason several companies, not just Nintendo and Sega, were thinking that console gaming would be dead or injured by 1998-1999. Nope. But Sega will act on the thing they haven't confirmed yet just the same.

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JULY 1996

News and Observer Jul 16th 1996

So this is continuing from the last article from June, just one month before. Here is Sega agreeing to partner with Compaq to produce games for its Presario computers. As Compaq is focusing on more than just productivity with these devices, but also multimedia. What luck Sega was already pulling a 3DO and moving toward PC already. It can now waste more money on a nothing project.


The Province July 26th 1996.

So here we have Sega kicking Tom Kalinske and replacing him with Shoichiro, and making Bernie Solar the new VP in a restructuring shake up.

The middle section is baffling to me. "how desperate video game companies have become" no...it's just Sega. "Money is no object at the moment, the price will be paid down the road" ok.... which road? Sega has been down many roads, where's the profit at the end of the tunnel? Pointless being aggressive with no plan.

Also new division Sega Soft, to help Sega focus on "games" which I guess means Sega wasn't focusing on games before? But don't worry Three Dirty Dwarves will save the Saturn.

Btw, did you know Ultimate Mortal Kombat 3 is the first MK title on the Saturn?


LA Times July 16th 1996

This just goes over some of the stuff from the last article about Segas shakeup.

The difference is here we find out Hayao and David both resigned during the shakeup. There's also a focus on Sega struggling in the market place.


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AUGUST 1996

Fort Mcmurray Aug 22nd 1996

So Sega seems to be wanting to be more like Nintendo for some reason, despite it's nearest competitor Sony gaining consumers based on broad demographics and genre/themes. They do later somewhat backtrack on this, but they did still limit violence to some extent. You won't be seeing GTA on the Saturn that's for sure. It may not seem like much at first glance, but this just adds more problems to the pile in dealing with Segas market performance.


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SEPTEMBER 1996

Leader Post Sept 4th, 1996

Presenting Sega City Pladium. get it? Play+Stadium=bankrup Pladium.

You'll notice Sega and the names of their partners involved with this venture are the same as a much earlier article. This is what that "entertainment plan" ended up becoming.

It's not a theme park, but it costs more than an arcade. 40 locations planned to be build across Canada, and it aims to create a "new market" with this...somehow. Also look, that Imax snippet from a previous article is involved with these centers as well. See? it's all coming together.

But the article brings up a question that' quite important: "But will it make money?" btw, the "Staff" are called "gamers" huh.. 5 to 7 years to roll out the other locations, wow that's a longer time table than they said in the earlier article, and it won't happen anyway.

Btw, the pladium is pay to play. Games range from $1.60-$4.95 Canadian. Eh?


Santa Cruz Sentinel Sep 23rd 1996

So we finally get an info dump on Netlink, a date, and a $200 price. Of course you need a Saturn too. You can get a full package, which includes a keyboard so you don't have to use the screen, for $50 more than the original price of the Saturn at $450. Or you can pay $400 if you can't get the pack, or $200 if you already have a Saturn, but in both these cases you'll likely have to spend extra money on a compatible keyboard.

Of course, they still aren't mentioning the other fee(s) yet but that's another story.

Also notice the mention of Sony and Sega being in a price war Sega can't afford to be in. At this point its obvious it's not giving the sales increases Sega hoped for either, so at this point they seem to just be lost. Notice "doesn't yet have MP games" or "Sega is doing everything to make Saturn more attractive" are they? are they really?


Chicago Tribune Sept 27th 1996

So this seems to be more of a hit piece. Sega is betting on Netlink for Saturn adoption, and notice in no article yet has a game been mentioned and it's launching in October. It then makes a reasonable observation: would gamers, and if they are kids their parents, rather buy a $200 Netlink which also includes other fees and likely a keyboard as well, or with that same money, by 4 games for their Playstations? Heck that applies to the Saturn too. $200 will get you a good investment toward an N64 as well.



Sunday Telegraph Sept 8th 1996

SEGAWORLD THEME PARK! Just opened in London. 7 floors of fun, 10am-midnight. A "futuristic park" was built and it took two years to create, with money. E45 million is what it took to open this park. Surely it will be a massive hit and give 10x ROI....oh....


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OCTOBER 1996


Sydney Harald Oct 1st 1996

Sega making a deal with a third party to distribute arcades in Australasia. In 1996. Interesting timing Sega.


York Daily Record Oct 15th 1996

So, some people here likely have seen the name "Pico" before, but before you jump to conclusions that's not what THIS is. This is a edutainment BUS. Literally a bus, and it has stuff in it. This is not a consumer device.

Sega bus for the kids. 100% ROI.*


*no



The Province Oct 11th, 1996

This is just a sad article. This is clearly someone struggling having delusions. Who cares about the Nintendo 64 when Segas "defiantly" sticking to it's guns, the ones that barely function and keep backfiring. Clearly this is the strategy that will put Sega right at number one. lol.

The fact they brought the "it's too powerful" excuse for the software issue is amazing. Yet they had no issues on the PSX, hmmmmmmm.

"The games flow better and there's way more color" this is barely anything, what is this?

So Wardope said that "I thought Sonic was fast on the Genesis, but the gameplay on the Saturn is incredibly fast" which indicate he PLAYED a Saturn game, but WHICH Sonic game is he talking about? Or is he just talking about an imaginary game? Notice it doesn't give a name. None of the games on the Saturn are faster than the Genesis Sonic games, the closest you'll get are those same Genesis games in the Sonic Jam collection, including Sonic Xtreme.

I also like the blunt lying about the Saturn with Netlink being able to do EVERYTHING (???) A multi-thousand dollar PC can do. Wut? None of this addresses the problems Sega needs to resolve to be competitive, or at least avoid falling down a canyon. Not one bit.



Oakland Tribune Oct 10th 1996.

Sega is cutting game prices, but the fact Sega's retail partners weren't even made aware of the price cuts will of course, piss them the hell off, but the article is being nice about it. I mean a Sega rep even said "should be available now" I mean you can't make this stuff up.



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NOVEMBER 1996

Berkshire Eagle Nov 24th 1996

We are finally entering the Holiday season and the last two months of the year. Sega is struggling, and they need to save money and create some kind of safety net.

So fuck that, let's advertise this Pico console thing, and have the ad for it bee place right above one talking about curing foot fungus, just says "buy me" to the consumer. I wonder what the "free offer" is if you call.



News Tribune Nov 17th 1996

Finally the Netlink that's going to save Sega! OMG! Is out and is shipping yes SEGA IS SVAED! You heard it here first. No wait, no, not really.

.....$8 a month for 5 hours of usage. A month. 5 hours. $20 for unlimited.

They acknowledge you'll have to buy a keyboard if you don't want to use the controller and on screen pad, However, you need a $20 doohickey, so if you just brought the keyboard Sega says go screw yourself, buy our thingy or it won't work. Unless you buy the full package which includes a Sega keyboard, then you'll pay $450.

You still need to pay the other fees though.

Basically around $500, that will get you A Saturn, Netlink, and one game. Or you can pay $250 assuming you are buying a keyboard, if you already own a Saturn.

$500 you could get a PSX or an N64 with games.

$250 you can get a PSX or an N64 with a game.

Or you can pay $250-$500 to "surf" the net on a Saturn worse than a PC with no game, or one game if you pay the $500.

Man I am stumped which of these the average consumer will choose.



The State Nov 18th, 1996

Sega has a new machine in the works. A few reports about that going around then. I mean things are going so well I'm not surprised they would be looking for a quick replacement. Always replace the things that sell, that way you lose money, and that leads to a successful company.

Wait...


The Columbian Nov 21st 1996

So...

Looks like that Netlink may have a few issues, and not be the savior that it was supposed to be. So, all the money went to what exactly?

The article starts off taking a jab at Sega being in third place, though that happened less than a month after the N64 came out. Sega's panic on getting the Netlink out to save the Saturn has backfired, and not just because of these issues, it was also incredibly overpriced.

I like this quote "Netlinks best shot of salvation is online gaming" then says "Sometime in the first three months of NEXT YEAR, Sega promises Netlink owners will be able to play each other in several games" Sega, all this time to ship this shit and you don't have any damn games yet? That was the original point of the damn Netlink when you announced it before coming up with a name?



Detroit Free Press Nov 22 1996

"it's the only company of the big three that's strictly a video game company" not according to Sega the past..year. Maybe that's what they should have been the whole time.

So the "not a 3D machine" was making rounds but it was especially picking up at this point because people were upset. I do disagree with the excuse above the 2D console one though, I don't think there's a single Japanese game exclusive to Japan that would have helped the Saturn if brought over that wasn't already released in the US. I looked at the best selling titles, I don't see one.

Clearly these people never heard of Netlink, which will save Sega. But the point of this article is to show that Segas image was more than just a little bruised by this point.



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DECEMBER 1996

Leader Post Dec 28th, 1996

We are now in December, the final stretch! Let's see how...oh.....

So this is a bit self-explanatory. The fact Sega months ahead of time knows their fiscal year is doomed is pretty telling. Sega has really fallen low during just this last year haven't they? Crazy how just in January it seemed like they were on the cusp of charging ahead. Interesting.



Fort Worth Telegram dec 28th 1996

So Sonic X-treme is recalled on the even of its launch, and Sega is struggling, but it's thanks to....*checks notes*......Nights? That a knockout blow wasn't delivered to Sega. According to this guy anyway. Apparently it's a substitute for Mario 64. Peter-Pan flying game lol.



Tallahassee Democrat Dec 27th 1996

I mean, Nintendo invested in call center help lines for dumb people that can't press the A button too, so I can't really go too hard on Sega for this, but the amount of investment seems a bit high, and I don't believe Sony went this far either, maybe they did, but something tells me this is excessive and costly. I guess for those playing Nights this might be useful since people even today who first play that game on a used Saturn or emulator have no clue what they are doing.



Sydney Harald Dec 28th 1996

So, $253 million loss for sega.

Just good ol' $253 million loss, nothing to see here. Everything is fine. Slashing of a forecast of Y27Billion to Y11Billion is perfectly normal and happens all the time.

it's only a "special" loss, nothing serious, but I'd reckon Sega would want to avoid more "special" loses in the future, but that's just my opinion. Clearly, they know what they re doing and have everything under the control.



Vancouver Sun Dec 21st 1996

Say, remember that Sega/Dreamworks/MCA Gameworks thing? Well now they are trying to lease space at the liberty center in New York. Clearly a worthwhile investment, and I believe Gameworks will be around for a long time with a high ROI.

No it won't.



Daily Advertiser Dec 29th 1996

Another $215 million dollar loss at Sega, US division. Which they blame on inventory of the Genesis they didn't market and support correctly totaling $61 million.

Now, I'm not a Math Professor Teaching Calculus 4 at some $80,000 a year college. But I just feel that maybe Sega is doing just a tiny bit of bullshit here, just a tiny bit, with the blame game they are playing.

They also cut their group net profit by $46 million.

These are all signs of a company that is run well and on the cusp of a comeback any moment now. Especially with Netlink still not having any games or a price cut, which will cause consumers to buy more Saturns. And they needed to kill the Genesis, having a safety net is something that bad companies would do, while we are at it, the arcade division is wobbly but that's ok, it's all apart of the massive growth Sega is imagining it's having. If we just open some more SEGWAROLDS parks all the problems will go away.



Vancouver Sun Dec 14th 1996

Well Netlink didn't work out, but will will save the Saturn is clearly, clearly, having it function as a video phone. yes, an (expensive) adapter and mic/camera + service will allow users to video call on the phone. This investment had a clear path to ROI, it doesn't, and will surely end up being very profitable. Sega doesn't panic and react, they come up with unique ideas that always succeed at not generating profit. That's the Sega difference.

Wait...

End of PT1
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Start of Pt 2
-----------------

Lexington Herald Dec 22 1996.

It turns out in the end, Sega figured it would use 3DO strategy in the west which lost them so much money it caused GoldStar(LG) to drop out making 3DO's, caused Panasonic to flinch, and made 3DO not only restructure, but eventually even abandon their M2 plans for cost reasons.

Sega figured, hey Nintendo and Sony have shortages, they aren't producing enough to sell, and we at Sega aren't selling at all, so why not after recently having another price cut on our console, give 3 free games away for free with each Saturn. Literally the 3DO strategy, because surely if we at Sega do it, it will somehow reverse the lack of money making that occurred when 3DO did it, and will make money because uh... Sega is magic. I mean, it'll boost sales short-term, but you'll also lose crap tons of cash, and it won't work long-term, and Sega found that out after the holiday season ended.

Curiously, 3DO was able to get away with that strategy longer, and sales picked up at a higher rate. Seems Sega's image being ripped to shreds may have been a factor here.


Positioner Dec27th 1996

And there you have it, we end here. An article about Sega talking about a possible deal to slap their brand on a new console that's operated and produced by a third-party while Sega just makes software, becoming the next 3DO company, whom just went third party. Yep, in one year the confidence is gone, Sega is a wreck, money is low, and 1997 is looking like a nightmare.

It is quite fascinating to see things crumble so far.


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<>

We are now finished, thank you for joining me on this ridiculously long overview of Segas actions, that had set it on the inevitable path to failure. In just one year Sega went from a top contender to dominate the gen, to losing loads of cash and falling behind with a tarnished image, and Netlink surprisingly did not save it. I can't believe it didn't work. lol.


These were all compiled from archives I've had in a few hard drives filled with articles related to various subjects. This is not everything Sega did wrong, there are a few other things I can't find that they did with acquisitions, and there was the whole Softbank partnership for PC, as well as an article going over how Sega in Nov or Dec lost 66% of their cash and so on, but I believe this is more than enough to make the point clear, and covers most of their follies. I will update the thread though if I find anything else relevant as I dig through the scans.

As you can see, Sega went from a reasonable player to cash starved taking losses, with most everything they tried falling apart. In 1997 there would be a few desperate attempts to try and find some way to come back, but Sega would end up running on thin air, and was pretty much a zombie corporation outside a few injections and some revenue still coming in, mainly because of Japan. However, the damage had been done, and their next gamble with the Dreamcast would not have been possible without some help as mentioned before. Of course, Dreamcast would be harmed preemptively in the long-term, as well as short-term consequences due to Sega's actions before the console came out, the bulk of both tracing back to 1996.

In just one year Sega went from a potential dominator, just hitting a few small speed bumps and was ready to jump into action, to a C-tier company scrounging for some way to stay out of restructuring and bankruptcy, trying anything and hoping something would work in a panic.

It really shows how dumb and poorly run Sega was, and it's a shame because they really could have done better, especially with some of their software. If they were more focused, some of their ideas may have done well, or at least been a profitable niche to a targeted audience if you know, they had a plan. Instead of announcing things with no plan. It really makes clear that Sega was just not ready to "compete" in anything at an aggressive level. The change at Sega post Sonic 1 was pretty much all action and reaction, and little to no thinking

It really is/was an astonishing thing to witness at the time and in retrospect.
 
Why are people on this forum so obsessed with creating Sega hate threads lately? Is this for internet clout / coochie points or something?
That's clearly not what this is unless you just read the title.

Clearly something Sega related happened in-between when I took a break from gaf and then came back to login recently, but you shouldn't assume I know of this stuff when I'm not here.
 
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PJX

Member
That's clearly not what this is unless you just read the title.

Clearly something Sega related happened in-between when I took a break from gaf and then came back to login recently, but you shouldn't assume I know of this stuff when I'm not here.
Well you could have searched for the countless Sega topics recently regarding their missteps and how they reached their peak in 1994 and post that information in there. Just saying.
 
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Well you could have searched for the countless Sega topics recently regarding their missteps and how they reached their peak in 1994 and post that information in there. Just saying.
Which would be those "sega sux" threads which this isn't about, making your suggestion pointless. As for the peak 1994 thread, this is a different topic and clearly it shows in the OP that this is it's own conversation, and focuses on a completely different year.

I'm not going to search up "sega sux threads" when I don't think Sega "sux" so I would have no idea about as you say, the numerous anit-Sega threads being creates, that I couldn't have possibly have known about through my multiple months break from gaf, until I had a bunch of users such as yourself and others come and derail my thread here.

Which I hope the mods will fix by removing these derailing posts so this can be the civil discussion it should be.
 
I know what that was!



So I'm just going to report your nonsense until these derailing posts are removed by the mods so the thread can restart proper.

I was here posting already in 2021 and then took a break, not this imaginary lie you're derailing the thread with.
 

Ozzie666

Member
I don't think it was just 1996, there is just too much beforehand. But the success of the Genesis in America was really an anomaly and lucky. They were successful in the arcades, but they were terrible at home consoles and running that side of the business. They were never a good home console company. They appeared to never have a real logical plan of attack and where way out of touch. Sega CD, 32X, over price game gear, the list goes on.

They were a poorly run business for years, even during the Genesis success. Arcades and innovative software is where they excelled.

By the time they really learned their lesson, we got the Dreamcast. But they were too far gone and even that console had a controller that was so out of touch with where the market was headed. In an alternate timeline the Dreamcast continued on. We all love SEGA, but their mistakes are many, can we stop beating the dead horse :)
 
Impressive list OP as a "tribute" of the failure of SEGA but we see regularly topics on this matter, like a trauma deep in people mind since 20+ years.

But you'all need to move on, it's not like it will change anything to the future of SEGA to analyse their fails except for archive/entertainment purpose.

I was there and It's game over guys ¯\_(ツ)_/¯
 

PJX

Member
Which would be those "sega sux" threads which this isn't about, making your suggestion pointless. As for the peak 1994 thread, this is a different topic and clearly it shows in the OP that this is it's own conversation, and focuses on a completely different year.

I'm not going to search up "sega sux threads" when I don't think Sega "sux" so I would have no idea about as you say, the numerous anit-Sega threads being creates, that I couldn't have possibly have known about through my multiple months break from gaf, until I had a bunch of users such as yourself and others come and derail my thread here.

Which I hope the mods will fix by removing these derailing posts so this can be the civil discussion it should be.

That is quite a post, Eddie.

Tripping about this being a sega hate thread. C'mon. This is a good chunk of research on Sega imploding, which has always been a fascinating subject. It's interesting.
But these are information that people have known throughout the years and is just being regurgitated over and over again.
 

skybaby

Member
Amazing post. Gameworks lost them money, with locations in places Guam and Brazil it was expected. But damn if it wasn't amazing checking out technicians from japan wearing Sega vests setup stuff like VF4 and After Burner Climax play test machines months before official releaes
 

SmokedMeat

Gamer™
Sega had been screwing up like crazy. While their Arcade business was amazing, I don’t think their console business would’ve ever taken off it not for Sonic.
 

Alan Wake

Member
Sega were great in delivering awesome consoles and groundbreaking games but less great in actually making money. And so, it all came to a sudden stop. If they had had Microsoft's war chest, things would've been very different.
 

64bitmodels

Reverse groomer.
It really shows how dumb and poorly run Sega was, and it's a shame because they really could have done better, especially with some of their software. If they were more focused, some of their ideas may have done well, or at least been a profitable niche to a targeted audience if you know, they had a plan. Instead of announcing things with no plan. It really makes clear that Sega was just not ready to "compete" in anything at an aggressive level. The change at Sega post Sonic 1 was pretty much all action and reaction, and little to no thinking
All they really had to do was just make a weaker version of their model 2 hardware, put it in a Saturn, and then for the next 5 years do nothing but make game after game (including Sonic games because.... of course.)
all this experimentation shit was so fucking stupid (outside of the DVD stuff and online gaming which Sony and Microsoft would end up doing better later down the line)
 

Perrott

Member
Before we go into the documentation context is needed. Many people know Sega ended up failing for various reasons, however before the Dreamcast was even launched Sega was already in the hole, and Sega was in no position to launch the Dreamcast itself until a influx of money from outside helped, along with partnerships, Sega was basically a zombie company or near one at that point before receiving that uplift. Before Jan 1996, Sega made a few flubs, they gutted the 32X early and were about to kill it off, yet still kept being stubborn about killing the Sega/MegaCD, the Saturn launch had it's own issues, however that would not be obvious yet especially for long-term consequences, their marketing strategies were mostly detrimental, they were basically doing the opposite of what they did with the Genesis, and they were not utilizing staff the same way with the Saturn as they utilized them with the Genesis. This applies everywhere btw, except Japan.

However, almost all the things people say Sega did in this era to cause their fall, that would also sabotage their last gamble (Dreamcast), as well as myths/rumors all were not happening yet in early 1996. the documentation below which I will show with breakdowns in chronological order (by month) will showcase that Sega at Jan 1996 (outside of Japan especially US) was actually not in any notable danger of anything, they were only just starting to flub Genesis in 1994 regarding support, which resulted in interest in the console dying compared to the extended life of the SNES. 1996 will show them further screwing that up for the last time, but at the start of the year there was no such belief that the Genesis would be a liability and it was thought it would be an entry level system for Saturn owners.

The Saturn also, at the start of 1996 was not far from PS sales in a few European countries and the US, The press that was iffy on the Saturn was a minority early in the year, as Segas announcements were anticipated at the start of 1996, there was no expectation of Sega "failing" even from Sega themselves, they hadn't started acting like they had the money of Sony or Nintendo's reserves, and were at worst acting like a slightly ahead of themselves market leader, in fact Sega was still the market leader in the US in jan 1996, with Sony right behind, so pretty much nothing that most people would say about the Saturn, or long-term consequences of earlier decisions, haven't happened yet, especially since the latter only came to prominence due to mistakes Sega made in 1996 enabling those consequences to fester, and quickly. Sega itself while having taken a few scratches, was still sitting in cash from peak genesis and some other areas like arcades.

I would like to put in context as well, that in the US the Saturn and the PSX both launched in late holiday sales period 1995, so we are only a few months from launch in Jan 1996, and this is important for context for the reports below. The documentation below aims to show that Segas downfall was primarily due to a cumulative number of Sega's actions done almost entirely just in 1996, and it's important also for context, that Sega's actual value in money was maybe in Jan 1996 only 2.5-3x more than the 3DO company value at it's peak, which needed help to launch their console in 1993 due to the costs involved. So keep this in mind when looking at documentation later in the year when Sega acts like they are high rollers like Sony when they actually don't have the cash, in some cases likely using credit and/or loans, or partnerships.

Now then let us begin. Articles will be in quotes to reduce clutter

JANUARY 1996


Miami Herald Jan 18 1996.

Already we start off the year with Sega in talks with Panasonic/Matsushita on creating a DVD related consumer device. Included is the mention of complex games DVD could provide, including better quality FMV and sounds. Of course, this never went anywhere and the money spend on exploration was pointless, in fact, Sega would drop out of the console market before they's even touch DVD for games, years after this.



Oakland Tribute Jan 14th 1996

Here we have Sega in Jan 1996 still the market leader in the US, with Nintendo pretty close behind, a fast approaching Sony, and a pre-desperation sale 3DO in the rear. This is going to change drastically throughout the year.




Elpaso Herald Jan 2 1996)

This is a summary of an issue regarding Sega firing/laying off staff who are slow to adopt or refuse to adopt some elements of modern computing in their lives. This is in japan and will end up having a long-term consequence for the company there later, as several of these staff could've been helpful in operations once Sega's initial success there starts rapidly declining.



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FEBUARY 1996

Orlando Sentinel Feb 21

Lockheed Martin has formed Real-3D to carry on an expensive joint venture that was already on-gong over at Sega, which would result in the costly but impressive Model 3 Arcade board and games.




National Post Feb 28th 1996

Ok, so things are starting to become clearer now about Sega's back end. Sega takes a $340 million loss due to issues and restructuring/shrinking of their European operations. Reducing the countries it deals with directly with middle-men for the others. They also mention unrelated separate losses in the millions. Sega is pivoting to focusing on "games" and SEGAWORLD. Which is interesting because Sega had always presented itself as always focusing on games so this messaging is quite interesting. There's also losses from the US involving inventory, and Sony is picking up steam WW over Sega. Also, Sega starts the Genesis blame game here which it uses as an excuse for losses throughout the year even though it's not the primary cause, or even half the cause, of most of the upcoming losses. But we'll get to that gaslighting strategy later.




National Post Feb 7th 1996

Sega is partnering with IMAX to install theaters at two of Segas high-tech "amusement parks" in this report. It's a small snippet but it all adds up to produce the full picture. It will actually be foreshadowing stuff that's going to happen later so keep this in mind.




San Francisco Examiner Feb 16th

Now some people here will likely know what this internet product will become. To keep things in context though I won't actually name the device until an article does later on. But this is the first major look at Sega's "internet TV" plans for the Saturn, and as things get worse for Sega it becomes a "plan" that Sega hopes will raise adoption of the Saturn console. It still comes out this year, but keep this article in mind as right now Sega is announcing this product with no name, and it will become apparent later that they also have no plan. At this moment the device is actually in development, there is however NO SOFTWARE being prepared for it yet. This is despite the fact Sega is basically telling you that the whole point of this device outside browsing is to play games with it. More money down the drain, keep this in mind.



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MARCH 1996


Daily news March 4th 1996.

So Sega along with Dreamworks, Spielberg, SKG, and MCA are in a partnership to open 100 entertainment centers in 4 years. Or at least that's what they planned to happen. But it doesn't work out that way.


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APRIL 1996


San Francisco Examiner April 18th 1996

So here we have Sega cutting their relationship with a company that helped Sega get to be as big as they "were" with no replacement agency planned to help Sega market their products on TV. On first glance of this article, you may think Sega is playing the blame game, instead of focusing on issues caused by themselves, and on that note you would be right.





Province April 26th 1996

So the Sega Nomad is here. Game gear is still on sale btw and marketed. $200, expensive, and Sega is as the article states not doing much marketing for it yet because they don't want to overlap with their GG push. Of course even after GG continues to decline to it's death they still only marginally pick up the marketing. Not the smartest sales plan out there.

Also, I never liked how the carts stuck out like that.



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MAY 1996


News Tribune May 18th 1996

So the announcement of VF3 coming to the Saturn is hilarious looking back at this, but we have here the mention of the then upcoming game "NIghts" and it coming with the Saturn Analog controller. However, Sega don't seem interested it including it with SATURNS for some reason. We also get the Net Link name drop for that internet device mentioned earlier still being invested in.




The Missoulian May 20th 1996

So a few things with this article. For one, Sega is not and never has been in any position to have a price cut war with Sony. Sega had at least 3-4 price cuts alone in 1996. 2nd, don't let these sales fool you that these two are close. Sega's sales in Japan is what's making these numbers "seem' even, and that's about to drop off with Sony picking up pretty much everywhere else.

We have a little but more detail on Netlink but not much. Notice that they still don't mention software for it. But there's the issue that seems to not phase Sega at all, that a person who actually wants their internet TV service, has to at minimum pay $50 more than what the original unsellable price of the Saturn was, which Sega than cut to be closer to PS, which also forced 3DO to cut from $400 to match PS, then not long after $50 below PS earlier this year. Not the price point of even modest adoption.


Clarion Ledger May 18th 1996

So Sega was supposed to come out in 1994 with the Saturn in the US which didn't happen, and therefore it was delayed until 1995. Apparently this delay which oddly matched the PlayStation US release date window, caused a 15% decline in profits. Sega lost near $40 million In their fiscal year ending in march. So clearly. the best thing to do at the time of losing money is to of course, cut the price, again, of your expensive top of the line consumer electronic product by $50 because.......

By now you're probably starting to realize, if you hadn't before, that Sega doesn't make any sense.



Sault Star May 18th 1996

This is just a repeat of the last one, I just find it curious how Sega is blaming a "later release" on its losses, yet was touting victory when it was slightly ahead of PS in 1995, which released near the same time. Something doesn't add up Sega,

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JUNE 1996


The Age June 26th 1996

So we are in June now, half-way through the year, and Sega is currently giving strong hints they aren't confident in the Saturn. They are already preparing computer games for PC due to the growth in the market, and the anticipation it will impact console sales (it won't).

Also notice the Nintendo director believing that if PC gaming continues to take off Nintendo may as well quit. Turns out he was wrong too. Already at this point the CD-rom is near standard on PCs and nothing was happening then, yet for some reason several companies, not just Nintendo and Sega, were thinking that console gaming would be dead or injured by 1998-1999. Nope. But Sega will act on the thing they haven't confirmed yet just the same.

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JULY 1996


News and Observer Jul 16th 1996

So this is continuing from the last article from June, just one month before. Here is Sega agreeing to partner with Compaq to produce games for its Presario computers. As Compaq is focusing on more than just productivity with these devices, but also multimedia. What luck Sega was already pulling a 3DO and moving toward PC already. It can now waste more money on a nothing project.



The Province July 26th 1996.

So here we have Sega kicking Tom Kalinske and replacing him with Shoichiro, and making Bernie Solar the new VP in a restructuring shake up.

The middle section is baffling to me. "how desperate video game companies have become" no...it's just Sega. "Money is no object at the moment, the price will be paid down the road" ok.... which road? Sega has been down many roads, where's the profit at the end of the tunnel? Pointless being aggressive with no plan.

Also new division Sega Soft, to help Sega focus on "games" which I guess means Sega wasn't focusing on games before? But don't worry Three Dirty Dwarves will save the Saturn.

Btw, did you know Ultimate Mortal Kombat 3 is the first MK title on the Saturn?



LA Times July 16th 1996

This just goes over some of the stuff from the last article about Segas shakeup.

The difference is here we find out Hayao and David both resigned during the shakeup. There's also a focus on Sega struggling in the market place.


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AUGUST 1996


Fort Mcmurray Aug 22nd 1996

So Sega seems to be wanting to be more like Nintendo for some reason, despite it's nearest competitor Sony gaining consumers based on broad demographics and genre/themes. They do later somewhat backtrack on this, but they did still limit violence to some extent. You won't be seeing GTA on the Saturn that's for sure. It may not seem like much at first glance, but this just adds more problems to the pile in dealing with Segas market performance.


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SEPTEMBER 1996


Leader Post Sept 4th, 1996

Presenting Sega City Pladium. get it? Play+Stadium=bankrup Pladium.

You'll notice Sega and the names of their partners involved with this venture are the same as a much earlier article. This is what that "entertainment plan" ended up becoming.

It's not a theme park, but it costs more than an arcade. 40 locations planned to be build across Canada, and it aims to create a "new market" with this...somehow. Also look, that Imax snippet from a previous article is involved with these centers as well. See? it's all coming together.

But the article brings up a question that' quite important: "But will it make money?" btw, the "Staff" are called "gamers" huh.. 5 to 7 years to roll out the other locations, wow that's a longer time table than they said in the earlier article, and it won't happen anyway.

Btw, the pladium is pay to play. Games range from $1.60-$4.95 Canadian. Eh?



Santa Cruz Sentinel Sep 23rd 1996

So we finally get an info dump on Netlink, a date, and a $200 price. Of course you need a Saturn too. You can get a full package, which includes a keyboard so you don't have to use the screen, for $50 more than the original price of the Saturn at $450. Or you can pay $400 if you can't get the pack, or $200 if you already have a Saturn, but in both these cases you'll likely have to spend extra money on a compatible keyboard.

Of course, they still aren't mentioning the other fee(s) yet but that's another story.

Also notice the mention of Sony and Sega being in a price war Sega can't afford to be in. At this point its obvious it's not giving the sales increases Sega hoped for either, so at this point they seem to just be lost. Notice "doesn't yet have MP games" or "Sega is doing everything to make Saturn more attractive" are they? are they really?



Chicago Tribune Sept 27th 1996

So this seems to be more of a hit piece. Sega is betting on Netlink for Saturn adoption, and notice in no article yet has a game been mentioned and it's launching in October. It then makes a reasonable observation: would gamers, and if they are kids their parents, rather buy a $200 Netlink which also includes other fees and likely a keyboard as well, or with that same money, by 4 games for their Playstations? Heck that applies to the Saturn too. $200 will get you a good investment toward an N64 as well.




Sunday Telegraph Sept 8th 1996

SEGAWORLD THEME PARK! Just opened in London. 7 floors of fun, 10am-midnight. A "futuristic park" was built and it took two years to create, with money. E45 million is what it took to open this park. Surely it will be a massive hit and give 10x ROI....oh....


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OCTOBER 1996



Sydney Harald Oct 1st 1996

Sega making a deal with a third party to distribute arcades in Australasia. In 1996. Interesting timing Sega.



York Daily Record Oct 15th 1996

So, some people here likely have seen the name "Pico" before, but before you jump to conclusions that's not what THIS is. This is a edutainment BUS. Literally a bus, and it has stuff in it. This is not a consumer device.

Sega bus for the kids. 100% ROI.*


*no




The Province Oct 11th, 1996

This is just a sad article. This is clearly someone struggling having delusions. Who cares about the Nintendo 64 when Segas "defiantly" sticking to it's guns, the ones that barely function and keep backfiring. Clearly this is the strategy that will put Sega right at number one. lol.

The fact they brought the "it's too powerful" excuse for the software issue is amazing. Yet they had no issues on the PSX, hmmmmmmm.

"The games flow better and there's way more color" this is barely anything, what is this?

So Wardope said that "I thought Sonic was fast on the Genesis, but the gameplay on the Saturn is incredibly fast" which indicate he PLAYED a Saturn game, but WHICH Sonic game is he talking about? Or is he just talking about an imaginary game? Notice it doesn't give a name. None of the games on the Saturn are faster than the Genesis Sonic games, the closest you'll get are those same Genesis games in the Sonic Jam collection, including Sonic Xtreme.

I also like the blunt lying about the Saturn with Netlink being able to do EVERYTHING (???) A multi-thousand dollar PC can do. Wut? None of this addresses the problems Sega needs to resolve to be competitive, or at least avoid falling down a canyon. Not one bit.




Oakland Tribune Oct 10th 1996.

Sega is cutting game prices, but the fact Sega's retail partners weren't even made aware of the price cuts will of course, piss them the hell off, but the article is being nice about it. I mean a Sega rep even said "should be available now" I mean you can't make this stuff up.



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NOVEMBER 1996


Berkshire Eagle Nov 24th 1996

We are finally entering the Holiday season and the last two months of the year. Sega is struggling, and they need to save money and create some kind of safety net.

So fuck that, let's advertise this Pico console thing, and have the ad for it bee place right above one talking about curing foot fungus, just says "buy me" to the consumer. I wonder what the "free offer" is if you call.




News Tribune Nov 17th 1996

Finally the Netlink that's going to save Sega! OMG! Is out and is shipping yes SEGA IS SVAED! You heard it here first. No wait, no, not really.

.....$8 a month for 5 hours of usage. A month. 5 hours. $20 for unlimited.

They acknowledge you'll have to buy a keyboard if you don't want to use the controller and on screen pad, However, you need a $20 doohickey, so if you just brought the keyboard Sega says go screw yourself, buy our thingy or it won't work. Unless you buy the full package which includes a Sega keyboard, then you'll pay $450.

You still need to pay the other fees though.

Basically around $500, that will get you A Saturn, Netlink, and one game. Or you can pay $250 assuming you are buying a keyboard, if you already own a Saturn.

$500 you could get a PSX or an N64 with games.

$250 you can get a PSX or an N64 with a game.

Or you can pay $250-$500 to "surf" the net on a Saturn worse than a PC with no game, or one game if you pay the $500.

Man I am stumped which of these the average consumer will choose.




The State Nov 18th, 1996

Sega has a new machine in the works. A few reports about that going around then. I mean things are going so well I'm not surprised they would be looking for a quick replacement. Always replace the things that sell, that way you lose money, and that leads to a successful company.

Wait...



The Columbian Nov 21st 1996

So...

Looks like that Netlink may have a few issues, and not be the savior that it was supposed to be. So, all the money went to what exactly?

The article starts off taking a jab at Sega being in third place, though that happened less than a month after the N64 came out. Sega's panic on getting the Netlink out to save the Saturn has backfired, and not just because of these issues, it was also incredibly overpriced.

I like this quote "Netlinks best shot of salvation is online gaming" then says "Sometime in the first three months of NEXT YEAR, Sega promises Netlink owners will be able to play each other in several games" Sega, all this time to ship this shit and you don't have any damn games yet? That was the original point of the damn Netlink when you announced it before coming up with a name?




Detroit Free Press Nov 22 1996

"it's the only company of the big three that's strictly a video game company" not according to Sega the past..year. Maybe that's what they should have been the whole time.

So the "not a 3D machine" was making rounds but it was especially picking up at this point because people were upset. I do disagree with the excuse above the 2D console one though, I don't think there's a single Japanese game exclusive to Japan that would have helped the Saturn if brought over that wasn't already released in the US. I looked at the best selling titles, I don't see one.

Clearly these people never heard of Netlink, which will save Sega. But the point of this article is to show that Segas image was more than just a little bruised by this point.



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DECEMBER 1996


Leader Post Dec 28th, 1996

We are now in December, the final stretch! Let's see how...oh.....

So this is a bit self-explanatory. The fact Sega months ahead of time knows their fiscal year is doomed is pretty telling. Sega has really fallen low during just this last year haven't they? Crazy how just in January it seemed like they were on the cusp of charging ahead. Interesting.




Fort Worth Telegram dec 28th 1996

So Sonic X-treme is recalled on the even of its launch, and Sega is struggling, but it's thanks to....*checks notes*......Nights? That a knockout blow wasn't delivered to Sega. According to this guy anyway. Apparently it's a substitute for Mario 64. Peter-Pan flying game lol.




Tallahassee Democrat Dec 27th 1996

I mean, Nintendo invested in call center help lines for dumb people that can't press the A button too, so I can't really go too hard on Sega for this, but the amount of investment seems a bit high, and I don't believe Sony went this far either, maybe they did, but something tells me this is excessive and costly. I guess for those playing Nights this might be useful since people even today who first play that game on a used Saturn or emulator have no clue what they are doing.




Sydney Harald Dec 28th 1996

So, $253 million loss for sega.

Just good ol' $253 million loss, nothing to see here. Everything is fine. Slashing of a forecast of Y27Billion to Y11Billion is perfectly normal and happens all the time.

it's only a "special" loss, nothing serious, but I'd reckon Sega would want to avoid more "special" loses in the future, but that's just my opinion. Clearly, they know what they re doing and have everything under the control.




Vancouver Sun Dec 21st 1996

Say, remember that Sega/Dreamworks/MCA Gameworks thing? Well now they are trying to lease space at the liberty center in New York. Clearly a worthwhile investment, and I believe Gameworks will be around for a long time with a high ROI.

No it won't.




Daily Advertiser Dec 29th 1996

Another $215 million dollar loss at Sega, US division. Which they blame on inventory of the Genesis they didn't market and support correctly totaling $61 million.

Now, I'm not a Math Professor Teaching Calculus 4 at some $80,000 a year college. But I just feel that maybe Sega is doing just a tiny bit of bullshit here, just a tiny bit, with the blame game they are playing.

They also cut their group net profit by $46 million.

These are all signs of a company that is run well and on the cusp of a comeback any moment now. Especially with Netlink still not having any games or a price cut, which will cause consumers to buy more Saturns. And they needed to kill the Genesis, having a safety net is something that bad companies would do, while we are at it, the arcade division is wobbly but that's ok, it's all apart of the massive growth Sega is imagining it's having. If we just open some more SEGWAROLDS parks all the problems will go away.




Vancouver Sun Dec 14th 1996

Well Netlink didn't work out, but will will save the Saturn is clearly, clearly, having it function as a video phone. yes, an (expensive) adapter and mic/camera + service will allow users to video call on the phone. This investment had a clear path to ROI, it doesn't, and will surely end up being very profitable. Sega doesn't panic and react, they come up with unique ideas that always succeed at not generating profit. That's the Sega difference.

Wait...

End of PT1
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Wow, amazing research! I really enjoyed my time reading through the whole thing. It would be interesting if you could continue writing about SEGA's downfall into the abyss during the years that followed 1996.
 
No way I am reading that wall of text after the last SEGA topic you stepped in.
Ah yes the one where you made illogical points, but regardless it was jsut a conversation, apparently you don't like people who disagree with you so call the OP a "wall of text" when it's not..

You seem to be stuck in a teen mindset, you can have conversations with people you disagree with, it's not that hard, instead of a drive by post on a major thread that took time like this one. Especially since the scans themselves aren't text.

Sega had been screwing up like crazy. While their Arcade business was amazing, I don’t think their console business would’ve ever taken off it not for Sonic.

I think there would have been a bump if MK ended up the same way, but since Sonic led them to be more agessives in partnerships that may have been short lived not long after. I think at the end of the day without Sonic the Genesis still would have sold 5-6 million units and arguably have been more profitable for Sega then the Genesis ended up being when they started quickly losing money at the end.

lol, what is up with the butt hurt up top?
This just reads like an archival/historical thread, I'm stoked to read it. Too late right now but I'll drink some coffee and look this over in the morning.
Animated GIF


Good job OP.

Let me know what you think.

Sega were great in delivering awesome consoles and groundbreaking games but less great in actually making money. And so, it all came to a sudden stop. If they had had Microsoft's war chest, things would've been very different.

No not really, Sega was quickly knifing themselves in all vital spots, Microsoft may have had a lot of money, but when they lost money on say, Zune, Zune wasn't 30% of their revenue and profits, in fact probably not even 1%. Same with Sony Pre-Ps3 debacle. They were making a lot of money in other areas, and int he case of those two, most of their money was coming from other areas.

Sega basically didn't have a safety net or a substitute to make up for their deepening losses.
 
All they really had to do was just make a weaker version of their model 2 hardware, put it in a Saturn, and then for the next 5 years do nothing but make game after game (including Sonic games because.... of course.)
all this experimentation shit was so fucking stupid (outside of the DVD stuff and online gaming which Sony and Microsoft would end up doing better later down the line)

A "weaker" version of Model 2 would have been difficult since the core gap between the model 1 and 2 wasn't that wise but the new features, techniques, and and effects introduced with the Model 2 were what really made the gap widen, and there wasn't much space for an significant in-between.

Arguably, the Saturn as it is WAS the in-between, or as close as you could get. VF2 on Saturn was obviously a lesser version than the Model 2 arcade, however it was also obviously showing that the Saturn was significantly stronger than the Model 1. Saturn is basically the best they could do without a $500+ price.

The experimentation was detrimental, but it was being done mostly as a reaction or as them seeking a solution to a problem they never could resolve. Same with the edutainment stuff like Pico. They were looking for something that could replicate the peak of their arcade success in the late 80's and early 90's, and the success of the Mega Drive, which both themselves were struggling.

Sega never could find anything that worked. That's why they bet so hard on Netlink and later, the Dreamcast online service SegaNet, because they were seeing the mass computer adoption, the popularity of the internet and the Web+AOL, they saw the profit and growth and thought that chasing it without a deeper strategy would change their fortunes if they caught it.

Sega wasn't the only one thinking this either, Tandy thought this, Phillips thought this and Sony by proxy, Nintendo was considering it, tons of electronic companies were planning or selling clunky home devices that supposedly would grab the consumers attention, Sony even tried it again themselves years later with WebTV I think it was called. Surf the internet on your television instead of a monitor! Everyone was doing it, Sega's problem was they didn't really do much to differentiate from other attempts.

The Dreamcast got buzz in North America for online gaming because the tech became better and they were among the first to take advantage of that, though outside of gaming everything else was still not that good. But it was Sega doubling down on the same bet, but it only succeeded in part for a short time as online play wasn't creating the mass appeal Sega though it would, at least not for SEGA anyway.

Almost all their other experiments from edutainment products, to being a consumer electronics maker, theme parks, tech hubs, being contractors, working with telephone companies, trying to enter the computer industry, so and and so forth where all just them hoping one of those would succeed so they could have a third wheel. But none of them seemed to have been planned strategically. Like Pico, how do we GET parents to adopt this thing? What would Sega NEED to do to have younger children be interested in the PICO? Another, Sega has the Genesis, it's popular, and here's the Nomad, but how do we convert those Gen owners into BUYING Nomads? How do we convince older teens and adults that the TV adapter is a good choice while on the go? Should we think about maybe making it so when you insert the game half of the cartridge doesn't stick out?

I mean in some cases the products were fine, maybe even better, but that doesn't really matter if people don't want them or don't know what they are or where to buy them. Then they have to be convinced to actually by the products themselves.

Like in the OP, Netlink was introduced as a full package for $450 not including the other fees. $250+ with no game if you already had a Saturn, that's 5-6 potential Saturn games right there. What value does that give to the consumer?
 

EverydayBeast

thinks Halo Infinite is a new graphical benchmark
Sega crashed but up until the Dreamcast they were doing well they have a great gaming background before everyone started worrying about internet, and social platforms.
 

RoboFu

One of the green rats
This story can be easily summed up.

Sega of America was making all the right moves… building the brand and kicking ass.. sega of Japan was jealous and actively hurt the company trying to pull power from SOA.

SOA how a totally different plan going into the 32 bit era.. different hardware different goals. SOJ threw a fit and blocked everything offered up by SOA.

SOA didn’t want the 32x. SOJ pushed it on them.

SOA wanted different Saturn hardware with different launch games.
 
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Alan Wake

Member
Ah yes the one where you made illogical points, but regardless it was jsut a conversation, apparently you don't like people who disagree with you so call the OP a "wall of text" when it's not..

You seem to be stuck in a teen mindset, you can have conversations with people you disagree with, it's not that hard, instead of a drive by post on a major thread that took time like this one. Especially since the scans themselves aren't text.



I think there would have been a bump if MK ended up the same way, but since Sonic led them to be more agessives in partnerships that may have been short lived not long after. I think at the end of the day without Sonic the Genesis still would have sold 5-6 million units and arguably have been more profitable for Sega then the Genesis ended up being when they started quickly losing money at the end.



Let me know what you think.



No not really, Sega was quickly knifing themselves in all vital spots, Microsoft may have had a lot of money, but when they lost money on say, Zune, Zune wasn't 30% of their revenue and profits, in fact probably not even 1%. Same with Sony Pre-Ps3 debacle. They were making a lot of money in other areas, and int he case of those two, most of their money was coming from other areas.

Sega basically didn't have a safety net or a substitute to make up for their deepening losses.

Yes, I know. I'm just saying that with Microsoft's wallet Sega could've gone on with the Dreamcast. A completely unrealistic scenario, naturally, but they could have. Xbox lost Microsoft a ton of money, but they could afford it and view it as their ticket in. Sega were too small and they simply didn't have the resources to take these kind of losses.
 

SirTerry-T

Member
So with this stuff and the Sega was full of shitty coders who shouldn't have used assembly posts we had the other week what's next on the "Pissing on the corpse of Sega" bingo sheet?
 
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killatopak

Gold Member
As someone with almost zero knowledge of Sega pre 2000’s, I appreciate these history threads.

I guess I’m pretty young in terms of gaf ages so I didn’t get to live the madness.
 
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SmokedMeat

Gamer™
I think there would have been a bump if MK ended up the same way, but since Sonic led them to be more agessives in partnerships that may have been short lived not long after. I think at the end of the day without Sonic the Genesis still would have sold 5-6 million units and arguably have been more profitable for Sega then the Genesis ended up being when they started quickly losing money at the end.

I don’t think there would’ve been a Mortal Kombat port if not for Sonic. Nobody cared about the Genesis when it launched. It wasn’t a hot item, and third party support was very poor.
I don’t think it would’ve even hit 5-6 million.

It’s fun to guess what would’ve happened though. Maybe Streets of Rage Would’ve put them on the map a little.
 
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StreetsofBeige

Gold Member
As someone with almost zero knowledge of Sega pre 2000’s, I appreciate these history threads.

I guess I’m pretty young in terms of gaf ages so I didn’t get to live the madness.
The 16-bit wars between Sega and Nintendo are legendary. And the games each system churned out were good. Sega had better arcade games (since they also had the backing of their arcade ports) and Sega's sports games were better. But Nintendo had better JRPGs, Mario and Zelda, and their Capcom and Konami games were much better.

I had both systems. Genesis first since it came out earlier. And SNES a couple years later when it came out. By the time both systems were out in full, you could already see the divide in types of games they were better in. So by the time 1995 came around and it was time to slow down game buying and get ready to dump them for PS1 (I got PS1 in late 1996), my game libraries in the final years were basically Sega Sports, EA Sports, Shinobi, Streets of Rage etc... for Genesis. And Mario, Street Fighter, Konami games for SNES (I don care for JRPG on SNES).

When PS1 and Saturn rolled around, I did Sony. I thankfully missed getting burned on 32X. Not buying that shit. Nor am I buying FMV loving Sega CD.

I dont think games in year one in North America (1995 to 1996) were great for either Saturn or PS1. I think most games were kind of shit. But by the time fall 1996 came around and I was ready to trade in all my Genesis and SNES gear (which who the fuck knew some of those games would be worth a lot in 2000+), PS1 was the clear winner.

Sega Sports on Saturn were terrible. I couldnt believe how bad they were when their Genesis World Series Baseball and NFL Football games were so good. As a sports gamer, the Genesis baseball games had more stat tracking and management features than the early Saturn baseball games. While PS1 had games like Formula One, Resident Evil, Destruction Derby 2, Ace Combat 2 was coming out soon and whatever other games I bought in that period I scooped up a bunch of starter games for my collection. Their year one sports games werent great either, but the second they went to polygon sports games like Face Off and MLB and Gameday, I couldnt believe how good they were while reading how crap Saturn's final sports games were (aside from I think WSB 98 which was reviewed great). Too late. I already converted to PS1 by then. Then Gran Turismo games came out later on, Medal of Honor etc... Wow. Blew Saturn into dust.

Very important too: Back then there was no internet for reviews, previews, research etc.... All you could go on for hype was magazines. And if a company did a good enough job to plaster mags with ads, preview articles, specs etc.... thats all you had. "Coming Soon" sections were small, nobody talked about games coming out in 4 years etc.... So you could see how easy it was to get hyped up and buy a shitty system like Jaguar or 32X.

If system like that released now, they wouldnt even get released. Gamers would see how shit the hardware is based on detailed analysis by websites and how there's no long term game list of good games coming out, so in 2022 we'd all avoid it.
 
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DT MEDIA

GAF's Resident Saturn Omnibus


I choose to believe that Sega went to shit in 1996 and never recovered, because a bunch of their talent got haircuts, like Metallica.

Oh, Good Lord, this is no joke. Kids in the 90s were obsessed with piling on rock stars who got haircuts. Metallica created a firestorm in ‘96. I remember people around me complaining that Chris Cornell got a haircut in ‘94 when Superunknown came out. It’s nice to obsess over such childish things.

Ah, well. How are those manufactured boy bands working out for ya?

Anyway, this thread does a very good job of posting newspaper articles about Sega in 1996, a pivotal make-or-break year for the company. I did ask for this, so Inhave no right to complain. The editorializing tone by OP is a little harsh, and I think much of the backlash on this thread comes from that, so it wasn’t very helpful. But, to be fair, that was also the common consensus about Sega at that time. They severely fell out of favor with the videogame crowd.

It’s far easier today to appreciate Saturn for the actual games and ignore the business side and the console war. We’re all grownups now and our personal egos aren’t attached to the toys we buy. So we can just sit back and have fun and not worry about anything else. But that’s the luxury of time. During the days of the Gen-5 war, it was hell for Sega, and as we clearly see, there was no way out.
 
Yes, I know. I'm just saying that with Microsoft's wallet Sega could've gone on with the Dreamcast. A completely unrealistic scenario, naturally, but they could have. Xbox lost Microsoft a ton of money, but they could afford it and view it as their ticket in. Sega were too small and they simply didn't have the resources to take these kind of losses.
Xbox also gained ground, got strong exclusive FP and TP software, a crazy high software sales figure in general, a good attach rate, great mindshare, good press, and beat out a veteran on the first try after being laughed at during launch, and had outsold the champion several months in a few countries on and off, and had a game that back then, sold so well, that it was the number one entertainment product in terms of money generated, Halo 2. Not to mention most of those losses were form them being ripped off on production of the hardware and the costs not going down during price cuts than the Xbox itself.

If Xbox was in the Dreamcasts situation by spring 2001, Microsoft may have just dropped out, because there wouldn't be sign of any progress being build, and there wouldn't be any indicator that they were breaking through to consumers that may grow with a new product.

I don’t think there would’ve been a Mortal Kombat port if not for Sonic. Nobody cared about the Genesis when it launched. It wasn’t a hot item, and third party support was very poor.
I don’t think it would’ve even hit 5-6 million.

It’s fun to guess what would’ve happened though. Maybe Streets of Rage Would’ve put them on the map a little.
MK was a hit game, and Sega was already working with third parties before Sonic, Sega would have attempted to at least get a port along with the SNES, and the blood controversy with SNES censoring it still would have happened, so MK would definitely have an impact on Genesis sales.

However, Sonic 1 is instrumental to HOW MUCH MK1 sold on the platform. Given that it increased the install base and got a lot of buyers to pay attention to the violent stuff and edge on the Genesis. That's why I think that it may have bumped up the Genesis but not much if Sonic never came out. Street of Rage is a mindshare product but that didn't generate to the sales people think it sold.

The reason why I say 5-6 million is before Sonic 1, the Genesis was already coming close to 3 million in the US. I think with MK, some of their other hit arcade titles getting ports, and the fact that Sega beat NEC before they could get in on the teen demographic, may have given it another 3 million sales by 1995. However, without Sonic Europe would probably be a big problem for sure, maybe 2 million over. Sonic really helped Mega Drive in Europe so that being absent would be much worse than in the US.

Very important too: Back then there was no internet for reviews, previews, research etc....
This is not accurate. I saw the previews for Crash Bandicoot online, and talked with people on Boards about how people at events were saying it looked better than M64 on the N64, and whether that delay for the N64 was worth it in 1996. It's also how I found out that Atari cancelled the VR headset.

If system like that released now, they wouldnt even get released. Gamers would see how shit the hardware is based on detailed analysis by websites and how there's no long term game list of good games coming out, so in 2022 we'd all avoid it.
For the Jaguar this did happen, and everyone was singing it's praises, people didn't realize Atari didn't have money for production, lied to devs, and tried hiding people pulling out of contracts once they found out they only had 2 games ready for launch with a gap until the 3rd. Unless you were in the inside or had good information, there was no way to know that the Jaguar would be "shit" because there was nothing giving any hints to that being true, the demos they showed off were deemed impressive, the power was deemed amazing, it's 2D graphics and color were considered an evolution, granted that's the only thing that ended up being true, over the SNES/Genesis).

People didn't know ahead of time that they would be waiting at game stores for weeks after the promised shipments of games because Atari was basically bankrupt and talking out their behind. If todays internet was there then, Atari would arguably be able to push a more deceptive Bullshit campaign, lol.
 

StreetsofBeige

Gold Member
This is not accurate. I saw the previews for Crash Bandicoot online, and talked with people on Boards about how people at events were saying it looked better than M64 on the N64, and whether that delay for the N64 was worth it in 1996. It's also how I found out that Atari cancelled the VR headset.


For the Jaguar this did happen, and everyone was singing it's praises, people didn't realize Atari didn't have money for production, lied to devs, and tried hiding people pulling out of contracts once they found out they only had 2 games ready for launch with a gap until the 3rd. Unless you were in the inside or had good information, there was no way to know that the Jaguar would be "shit" because there was nothing giving any hints to that being true, the demos they showed off were deemed impressive, the power was deemed amazing, it's 2D graphics and color were considered an evolution, granted that's the only thing that ended up being true, over the SNES/Genesis).

People didn't know ahead of time that they would be waiting at game stores for weeks after the promised shipments of games because Atari was basically bankrupt and talking out their behind. If todays internet was there then, Atari would arguably be able to push a more deceptive Bullshit campaign, lol.
You must had had early internet (in whatever incarnation the net was at the time). Most people I know didnt get the net till later in the 1990s. I didnt know game sites were already talking 32x, Jaguar and PS1/Saturn in 1993/1994.
 
During the days of the Gen-5 war, it was hell for Sega, and as we clearly see, there was no way out.
There was a way out, they just never thought to take any of them.

In the end, this made it so that a lot of good games were never known. You'd be surprised at how many people didn't even know there was a Saturn, in the US 3DO likely was more known just because of the legendary luxury status it represented it's first couple year followed by the free game giveaways to try and compete with the then rich giant that was known as Sony, which dominated pretty much almost every category of affordable consumer electronics.

Who'd have though Sony would lose all the money they earned off their entrance starting just 10 years after 1996.
 
You must had had early internet (in whatever incarnation the net was at the time). Most people I know didnt get the net till later in the 1990s. I didnt know game sites were already talking 32x, Jaguar and PS1/Saturn in 1993/1994.
Computers labs were widely becoming common in colleges and lower schools at that point, businesses were mass adopting, dial-up was exploding, and there were sites that people used to teach others how to make web pages, and then later websites.

E3 coverage was also online that year, there were definitely areas that were 1-2 years behind but many parts of the country had hooked into the net by 1996. I think Freewebs and Newgrounds were 95. Netscape was a favorite Browser.
 

Alan Wake

Member
Xbox also gained ground, got strong exclusive FP and TP software, a crazy high software sales figure in general, a good attach rate, great mindshare, good press, and beat out a veteran on the first try after being laughed at during launch, and had outsold the champion several months in a few countries on and off, and had a game that back then, sold so well, that it was the number one entertainment product in terms of money generated, Halo 2. Not to mention most of those losses were form them being ripped off on production of the hardware and the costs not going down during price cuts than the Xbox itself.

If Xbox was in the Dreamcasts situation by spring 2001, Microsoft may have just dropped out, because there wouldn't be sign of any progress being build, and there wouldn't be any indicator that they were breaking through to consumers that may grow with a new product.
A fair point, and I love what they did with the original Xbox. A great console in many ways with a better library of games than it gets credit for. Microsoft did lose a hell of a lot of money on the Xbox, though, so the size of their wallet was still important for them being able to continue. I'm glad they did.
 
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