Rocky beginning dooms Dreamcast
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After a shaky 15-month battle, Sega's 128-bit Dreamcast video-game console died last week from soft sales.
First introduced in the United States on Sept. 9, 1999, and selling for $199, Dreamcast seemed destined to thrive. Sega said Dreamcast was the most powerful game console ever made, but before the new console was even in stores, Sony Computer Entertainment stole the international limelight with the unveiling of a prodigy of its own: PlayStation 2.
Dreamcast is survived by parent Sega Enterprises in Japan, Sega of America and Sega's nine independent game studios, two of which have already announced projects for PlayStation 2.
Dreamcast got off to a rocky start when it debuted in Japan on Nov. 27, 1998. Because of a graphics-chip shortage, Sega was unable to ship as many consoles as originally planned. By the time the manufacturing snafu was solved, interest in Dreamcast had dissolved, and it took Sega more than a year to sell one million Dreamcasts in Japan.
By comparison with its rocky launch in Japan, Dreamcast began with a blaze of glory in the United States. Sega of America chief Bernard Stolar (who left Sega right before the Dreamcast launch) ensured a successful start by overseeing the games that would be available, making certain there was a wide selection of high-quality titles with no duds to mar the euphoria.
Looked unbeatable
Dreamcast looked unbeatable at first with its 15 games, including a martial-arts extravaganza called Soul Calibur from Namco, and its built-in 56K modem. Sega sold more than one million consoles by the end of 1999. But the tides were already against it.
A minor manufacturing glitch that caused games published by Midway to skip put a blemish on the otherwise perfect launch. Then there was the nearly endless wait for Sega to publish games with an online component. Without software support, Dreamcast's much-touted modem was little more than a benign cyst.
And lurking just beyond the horizon loomed the specter of Play-Station 2.
Litany of great games
In an effort to pull a rabbit out of their hats, Sega's nine autonomous game studios churned out an unmatched litany of great games. There was Crazy Taxi, a driving spoof in which players rushed passengers around downtown San Francisco in a chaotic race that involved jumping cars and finding shortcuts.
There was Space Channel 5, a music and memorization game in which players tried to save a space station from infestation by dancing with aliens.
And there were innovative games, too, including Seaman, in which players interacted with a talking fish, and Samba de Amigo, a game that players controlled with motion-tracking maracas.
Then there was Shenmue, an interactive epic created by Sega arcade legend Yu Suzuki. Huge and sweeping, Shenmue was a 15-chapter novel, only the first chapter of which was brought to life on Dreamcast.
But the games weren't enough. Despite the big sales in the first four months after its launch, Dreamcast ground to a halt in 2000. Sega tried desperately to revive the excitement with football and basketball games that played brilliantly as single-player games and set new standards in online performance.
Sega created SegaNet, a site for online gaming, and gave free consoles to consumers who would sign up for two years of Sega.com, an Internet service provider created specifically for Dreamcast.
Though many agreed that Sega had the coolest booth at the Electronic Entertainment Expo, held in May, Sony owned the show. Everyone agreed that Sega had a better line of games, but Dreamcast was the garlic toast and PlayStation 2 was the spaghetti.
PlayStation 2 launch
When Sony launched PlayStation 2 in Japan in March 2000, the event was covered by nearly every major news organization. Dreamcast began to slide from view.
Sega tried to build a beachhead before PlayStation 2 began its American invasion in October. By the time Sony made the big push, Dreamcast was selling for $149, half the price of PlayStation 2. It had a 200-game library, a thriving online presence, and little chance of survival.
For a brief moment, it looked as if Dreamcast might survive when manufacturing shortages at Sony offered Sega one last ray of sunshine. Then came the insurmountable wave of PlayStation 2 hype compounded by announcements from Microsoft and Nintendo that they had new consoles in the offing. Despite Sega's best efforts, Dreamcast was crushed by the onslaught.
"When you consider the strength of the PlayStation 2 hype, the cost of marketing a new platform in the North American market ... when you consider that Microsoft has announced a $500 million marketing program for the launch of Xbox, and that Nintendo has a $5 billion war chest and the overall power behind Sony's PlayStation brand, Sega does not have the ability to compete against those companies," observes Charles Bellfield, Sega vice president of marketing and corporate communications.
Dreamcast's legacy will be a newly revived Sega that focuses exclusively on software, making games for all kinds of platforms including cell phones, set-top boxes, and video-game consoles.
"Sega will absolutely be the first-round draft pick for hardware developers, in terms of working with software publishers going forward," says Bellfield. "Going forward, our sales will only be limited by the (number) of people who want to play games."
Steven L. Kent is a free-lance writer and longtime observer of the video-game industry. He is the author of the recently published "The First Quarter: A 25-Year History of Video Games."