History of the Dreamcast

From Wikipedia, the free encyclopedia
Jump to: navigation, search
The Sega Dreamcast.

The Dreamcast is a video game console made by Sega released on November 27, 1998 in Japan, September 9, 1999 in North America and later in 1999 in other regions. It was Sega's attempt to regain the market share after falling behind Sony and Nintendo, due to the company's unsuccessful add-ons for the Mega Drive/Genesis (the Mega-CD and 32X), and the failure of the Sega Saturn. The Dreamcast was initially successful, however the hype and release of the Sony PlayStation 2 considerably slowed momentum. Sega, foreseeing increased competition from the upcoming Nintendo's GameCube and newcomer Microsoft's Xbox, announced the Dreamcast's discontinuation in March 2001 and the company's withdrawal as a console manufacturer.

Contents

[edit] Origins

[edit] Concept

Sega was still suffering from hardware disasters such as the Mega-CD and the 32X (which were add-ons for the Mega Drive), and the Saturn console was in a distant third place in the 32-bit generation, against Sony's PlayStation and the Nintendo 64. While the Saturn held its own in Japan, its reputation in the United States was badly hurt as a result of a premature launch that let the PlayStation take the lead for good.

In 1997, Bernie Stolar, previously president of Sony Computer Entertainment America who oversaw the successful launch of the PlayStation, became the new president of Sega of America. Stolar pushed to discontinue the Sega Saturn in favor of a next generation console.

In 1997, newly appointed Sega of Japan president Shoichiro Irimajiri, unhappy with the company's internal hardware development division, enlisted the services of Tatsuo Yamamoto from International Business Machines to work on a secret hardware project in the United States. When the head of hardware development at Sega of Japan, Hideki Sato, caught wind of this he was less than happy and made it clear that any technical production should happen within Sega's Japanese Headquarters. Sato instructed his own team to produce a design for a new console.

Sato and his group chose the Hitachi SH4 processor architecture and the VideoLogic PowerVR2 graphics processor in the production of their mainboard, versions of which were successively codenamed "White Belt", "Guppy" and "Katana". Yamamoto and his group opted to use 3dfx Voodoo 2 and Voodoo Banshee graphics processors, and after initially trying other RISC processors from IBM and Motorola, settled on the SH4 as well. The codenames given for Yamamoto's project were firstly "Black Belt", followed by "Shark" and lastly "Dural".

Initially, Sega decided to use Yamamoto's design and suggested to 3Dfx that they would be using their hardware in the upcoming console, but then opted instead to use the PowerVR hardware of Sato's design. Some reports suggested that the 3dfx processor was more powerful, and it was strongly supported by Sega America President and COO Bernie Stolar, but he lost that argument to Sega's Japanese executives. The choice also puzzled Electronic Arts, a longtime developer for Sega's consoles; EA had invested in 3dfx but their main gripe was that they never knew of VideoLogic before.[1][1] Sega's decision has also been attributed to 3Dfx leaking details and technical specifications of the then-secret Dreamcast project when declaring their Initial Public Offering[2] in June 1997 a move which readers on Gamespy.com named one of the dumbest mistakes in video game history.[3]

In response, 3Dfx filed a $155 million suit in September 1997 [4] against Sega and NEC,[4] claiming that they had misled them into believing that Sega was committed to using 3dfx hardware for the console "while knowing that [they] would ultimately choose to use the NEC chipset",[5] and that Sega also had confidential materials and hardware relating to 3dfx's intellectual property which they had been deprived of.[6] In August 1998, 3Dfx, Sega, and other companies involved in the suit settled, with Sega paying $10.5 million to 3Dfx.[7]

[edit] Brand

The Dreamcast logo as used in Europe and Australia, which was modified to avoid a trademark dispute with Tivola. An orange logo was used in most other regions.

With the tainted public image created by the poorly performing Saturn and the recent public lawsuit, Sega's stocks were at an all time low. This lead management to the decision to hide the Sega name from the console as much as possible. The new console was called the Dreamcast and used an orange swirl as its logo, which "symbolizes the universe and the infinite power of human beings".[8] However, in PAL countries the Dreamcast used a blue swirl logo, rather than an orange one, in order to avoid a trademark dispute from Tivola, a German DVD company, who had an orange whirl as part of their logo, in which it replaces the "O".

[edit] Developer Support

Electronic Arts was one of the notable developers that ending up did not publish games for the Dreamcast. Although EA had long supported Sega's earlier consoles, and this partnership has been attributed to EA's emergence as one of the dominant players, it had suffered losses from the Sega Saturn and its premature discontinuation.

During negotiations, EA was irked by Sega's indecision over hardware, including which graphics chipset and whether to include a modem. One EA executive said "there was a push from Sega, which was having cash flow problems, and they couldn't afford to give us [EA] the same kind of license that EA has had over the last five years. So EA basically said, 'You can't succeed without us.' And Sega said, 'Sure we can. We're Sega.'[1]

There was disagreement between Sega and EA over sports games. EA knew that hardware manufacturers were at risk when launching a new console, and would use such situations to EA's advantage. EA's then-president Larry Probst noted wide competition to EA's sports franchises and wanted five year exclusive rights for EA to be the only sports brand on Dreamcast. However Sega America's president Bernie Stolar had a strategic plan that included Visual Concepts (a company that Sega purchased for $10 million) as a key element for the Dreamcast,[9] and Stolar believed that Visual Concept's upcoming NFL title would be superior to EA's Madden NFL series. Sega offered to lower the royalty rates that EA would pay for publishing its titles on the Dreamcast but Probst would not budge on the exclusivity deal.[1]

[edit] Launch

The Dreamcast was released in November 1998 in Japan; in September 1999 in North America (the date 9/9/99 featured heavily in U.S. promotion and the Dreamcast premiere at theaters everywhere);, on October 14, 1999 in Europe and November 30, 1999 in Australia.

Due to technical problems Sega did not achieve their shipping goals for the console's launch in Japan. This was due to the lack of a graphics chip manufactured by NEC.[10]

Sega America's president Bernie Stolar successfully managed to repair relations with many major US retailers, many of whom were previously hostile to Sega due to being excluded from the launch of the Sega Saturn.[1] Before the launch in the United States, Sega had already taken extra steps in displaying Dreamcast's capabilities in stores nationwide. 17 launch titles were available for the Dreamcast in the U.S.[9] Much like the PlayStation's launch in North America, the displays of titles such as Soul Calibur, Sonic Adventure, Power Stone, and Hydro Thunder helped Dreamcast succeed in the first year.[11] The tagline used to promote the console in the U.S. was, "It's thinking", and in Europe, "Up to 6 Billion Players."

In the United States alone, a record 300,000 units[12] had been pre-ordered[10] and Sega sold 500,000 consoles in just two weeks (including 225,132 sold on the first 24 hours which became a video game record). In fact, due to brisk sales and hardware shortages, Sega was unable to fulfill all of the advance orders. Sega confirmed that it made US$98.4 million on combined hardware and software sales with Dreamcast with its September 9, 1999 launch. Sega even compared the record figure to the opening day gross of Star Wars Episode I: The Phantom Menace, which made $28.5 million during the first 24 hours in theaters. Chris Gilbert, the senior vice president of sales at Sega of America, said on November 24, 1999: "By hitting the one million units sold landmark, it is clear that the Dreamcast consumer has moved beyond the hard-core gamer and into the mass market."[13] Four days after its launch in the US, Sega stated 372,000 units were sold bringing in US$132 million in sales.[10]

While the Dreamcast had none of Electronic Arts' popular sports games after Sega rejected giving EA an exclusive deal, Sega Sports titles developed by Visual Concepts helped to fill that void. The biggest competition between Sega Sports and EA Sports in the U.S. was their American football and basketball games. This started with one of the launch titles of the Dreamcast, NFL 2K. Compared to its biggest rival which was the non-Dreamcast Madden NFL 2000, NFL 2K boasted a new graphics engine while Madden retaining the same solid engine of previous incarnations, and Sega America president Bernie Stolar considered NFL 2K superior to Madden NFL.[1] The competition continued on for their sequels where Sega Sports came out ahead, according to a press release which stated that NFL 2K1 outsold Madden NFL 2001 by 49,000 units in its first two weeks of release, selling a total of 410,000 by November 2000, two months after its debut.[14] In Europe where football is popular the Dreamcast released games were seen as poorer than those released by Electronic Arts and Konami

Businessweek recognized the Sega Dreamcast as one of the Best Products of 1999.[15]

[edit] Competition

The PS2 provided stiff competition to the Dreamcast.

In March 1999 Sony unveiled its PlayStation 2.[10] The actual release of the PS2 was not until March 4, 2000 in Japan, and October 26, 2000 in the United States. Sony's press release, despite being a year ahead of the launch of the PS2, was enough to divert a lot of attention from Sega. The PlayStation 2 launch in Japan took place in spring with only six unimpressive titles but sales were strong, plus Sony had substantial press and game developer support for its North American launch.[1]

Dreamcast sales grew 156.5% from July 23, 2000 to September 30, 2000 putting Sega ahead of the Nintendo 64 in that period.[16] During that time, the PlayStation 2 was plagued by production shortages, with people often paying in excess of $1000 on eBay for Sony's next-generation console.[17]

By September 2000, even before the PlayStation 2 arrived in the United States, the Dreamcast suffered from slowing sales going into the fall season. The Dreamcast's online capabilities through SegaNet, and a price cut from $199 to $149 USD around the second half of 2000 (which made it half the price of the PS2, part of an advertisement campaign to take advantage of PS2 supply shortages) did little to regain sales momentum. At that point, Sega had only sold 2.6 million Dreamcast consoles, far below the 5 million mark which was considered by analysts to be the installed base needed to attract new developers. Sega had loss an estimated $163 million, which was too much to make back on game sales and royalties (despite the Dreamcast having several titles that sold over one million).[9] Observers generally regarded Sega as an underdog against Sony.[18]

Even though the Dreamcast had 200 titles to the PS2's 50 at that point,[18] as well as being considered much more developer-friendly than the PS2 which was considered difficult to program for, the initial release of games weren't as important as the PS2's potential as Sony succeeding in delivering its much hyped graphics.[19] In addition, the PS2 provided DVD capability at the same price or less than dedicated DVD players at the time which made it a low cost entry into the home theater market,[9][20] in contrast to the Dreamcast's GD-ROM which was a cost-saving measure that also limited its multimedia capabilities to CDs. The Dreamcast's 56K modem and software for connecting to the Internet while revolutionary[21] were not enough to counter the PS2.

A key to Sony's relatively easy success with the PlayStation 2 was that they already enjoyed brand-name dominance over Sega after the huge success of the original PlayStation, while Sega's reputation had been hurt due to commercial failure of the Sega Saturn and Sega 32X. In particular, Sega's attempt to quickly kill off the struggling Saturn (which lagged in North America and Europe) in favor of Dreamcast had angered many third-party developers in Japan, where the Saturn had still been able to hold its own.[22] While initial Dreamcast sales were strong, many prospective buyers and game developers were still skeptical of Sega and they held off from committing, possibly to see which console would prevail. By early 2001, game publishers abandoned Dreamcast development en masse in favor of the PlayStation 2 and canceled many nearly completed projects.

It was reported that Sega was cash strapped, being able to run few magazines and TV adverts, being unable to give marketing support to innovative games, and couldn't pay third-party developers to make exclusive content or games for the Dreamcast. Bellfield noted that while the Internet was growing in 1999, it was still in its infancy, and Sega had to rely upon traditional TV and print media for advertisement.[1]

In 2000, there was the announcements of the upcoming Microsoft Xbox and Nintendo GameCube to be launched in the fourth quarter of 2001. Both Microsoft and Nintendo had large cash reserves, and Sega did not have the resources to sustain a prolonged marketing campaign against these new competitors. Their new consoles were expected to be more advanced that the Dreamcast, which further slowed sales as Sega could not convince consumers that their console still had untapped potential, and speculation that the Dreamcast would be discontinued mounted.[23][24] According to then-Sega America VP Charles Bellfield, "We had the content right. We had the marketing right. The product was designed right. The philosophy of networked capabilities was right. The team was right. The partners we had were right. But we didn't have the budget to be able to build the confidence of the brand in the eyes of our competitors that we were going to be around. That, to me, is the Achilles Heel of the Dreamcast. The first Xbox console was a far bigger failure than the Dreamcast. But Microsoft has much more money than Sega did. And the Xbox was an ugly motherfucker." Bellfield was comparing the launch and first years of the Dreamcast and the Xbox, noting that Microsoft had much larger losses than Sega during their respective periods, and it took several years for Microsoft to turn a profit from the Xbox.[1]

[edit] Outside U.S. and Japan

For the European and Australian PAL release of the Dreamcast, Sega changed the Dreamcast's orange swirl logo to blue. This was done to avoid copyright confliction with the German video game/DVD publisher Tivola, which already used an Orange swirl as their company logo. The logo also appeared on foosball tables produced for the hotel chain Hilton.

As part of Sega's promotions of the Dreamcast in Europe, the company sponsored four European football clubs: Arsenal F.C. (England),[25] AS Saint-Étienne (France),[26] U.C. Sampdoria (Italy)[27] and Deportivo de La Coruña (Spain).[28] The football advertising was at the bequest of Sega Europe's CEO at the time who was said to be a big football fan. However, this took up a significant portion of the budget and besides being ineffective, it robbed Sega Europe of the resources to promote new and innovative games which in turn would have more directly helped Dreamcast sales.[29]

Many important titles were never released in Europe, and many were hard to find without importing them. For instance, Sega Europe underestimated demand for Skies of Arcadia and Jet Set Radio which would have been hit games. While initial Dreamcast adverts promised "6 billion players world wide", most games only offered the option of online scores or access to the official game website instead of exploiting the Internet's potential. European releases of Dreamcast games such as Unreal Tournament and Daytona 2001 have had their online features removed or drastically reduced. Overall, there were only five truly online games for Europe: Phantasy Star Online, Quake III Arena, Starlancer, Toy Racer and Worms Worldparty.[29]

Sony marketed the PlayStation 2 in each country's local media, such as newspapers and street shows. Sega recruited third-party companies to promote Dreamcast, some of which did not allocate sufficient money for advertising.

DreamArena (the European equivalent to SegaNet, the Dreamcast online service) was a fiasco in Finland because the cost of connection was more than three times the amount of a normal ISDN internet connection[citation needed]. This was because Sega allowed open pricing for third-party companies. The companies stated that the price was steep due to a lack of potential customers, but most users believe that the companies were just using the open pricing to their advantage.[29]

While Dreamcast did receive a price cut in the U.S. to coincide with the PlayStation 2's American release, the European pricing remained the same, even when the PlayStation 2 was released in Europe.

[edit] End of production

Peter Moore, who was elevated to President and Chief Operating Officer of Sega America, made the difficult decision to discontinue the Dreamcast mainly due to Sega's limited financial resources, which initially caused a rife between Japanese and U.S. executives.[1] Moore was quoted as saying:

"We had a tremendous 18 months. Dreamcast was on fire - we really thought that we could do it. But then we had a target from Japan that said we had to make x hundreds of millions of dollars by the holiday season and shift x millions of units of hardware, otherwise we just couldn't sustain the business. So on January 31st 2001 we said Sega is leaving hardware. We were selling 50,000 units a day, then 60,000, then 100,000, but it was just not going to be enough to get the critical mass to take on the launch of PS2. Somehow I got to make that call, not the Japanese. I had to fire a lot of people; it was not a pleasant day."[30]

On January 31, 2001, Sega announced that production of Dreamcast hardware was to be discontinued by March of that year[31] although the 50 to 60 titles still in production would be published.[citation needed] The last North American release was NHL 2K2, which was released in February 2002. With the company announcing no plans to develop a next-generation successor to Dreamcast, this was Sega's last foray into the home console business. Massive price cuts were quickly instituted in order to move the abundance of unsold hardware and the system had quickly dropped to prices as low as US$49.99 new.[32] By late 2002 in the UK the Dreamcast was sold brand new for as little as £39.99 and was subject to incentive giveaways with contract mobile phones.

Though Dreamcast was officially discontinued in early 2001, commercial games were still developed and released afterwards, particularly in Japan. Unreleased games like Propeller Arena and Half-Life continued to become available to the public through warez groups and independent hackers. In the United States, game sales continued until the end of the first half of 2002.[33]

On February 24, 2004, Sega released their final first-party Dreamcast game, Puyo Puyo Fever. Afterwards, a small number of games continued to be released, which were mostly conversions of arcade shooters based on the Sega NAOMI arcade board, itself essentially a Dreamcast with extra video RAM.

Sega would sell the last Dreamcast units in stock through the Sega Direct division of Japan in early 2006. Although they were only refurbished units, they did come with the new Radilgy game and a phone card.

The first Sega title to be released on another console following the Dreamcast's demise was Crazy Taxi, which was ported onto the PlayStation 2 and the Nintendo Gamecube, by Acclaim.

The independent Dreamcast Emulation community figured out how to reverse engineer the Dreamcast and play Mil-Cd's without any hardware modification, through a free software development kit called KallistiOS, software support of the console continues with homebrew games, emulators for systems such as Mega Drive, Super Nintendo, PlayStation) and media players being released for the system.

Independently developed titles such as Feet of Fury have also been sold.,[34][35] Newer titles such as Last Hope (video game) and DUX have also been released.

Several Dreamcast emulation projects have also emerged including Chankast and nullDC. On June 10, 2010, at E3 Sega announced that Dreamcast titles would soon be available on Xbox Live Arcade and PlayStation Network. The first two titles to be released are Sonic Adventure and Crazy Taxi.[36]

[edit] References

  1. ^ a b c d e f g h i j "Features - The Rise And Fall Of The Dreamcast". Gamasutra. http://www.gamasutra.com/view/feature/4128/the_rise_and_fall_of_the_dreamcast.php?print=1. Retrieved 2011-12-16. 
  2. ^ "3Dfx's Initial Public Offering". http://www.sec.gov/Archives/edgar/data/1010026/0000891618-97-001792.txt. Retrieved 2011-12-16. 
  3. ^ "Gamespy 3dfx's Dream is Cast Aside". Archive.gamespy.com. http://archive.gamespy.com/articles/june03/dumbestmoments/readers/index3.shtml. Retrieved 2011-12-16. 
  4. ^ a b ElectronicNews Newspaper, Inc. (1997) 3Dfx sues Sega, NEC over contract Published Sept 8, 1997. Retrieved on 12 February 2009 from http://findarticles.com/p/articles/mi_m0EKF/is_n2184_v43/ai_19746977
  5. ^ ElectronicNews Newspaper, Inc. (1997) 3Dfx sues Sega, NEC over contract p1 - Citing 3Dfx Director of investor relations Laura Onopchenko; "Sega intentionally led 3Dfx to believe that Sega was committed to the 3Dfx chipset for Sega's new game console, while knowing that it would ultimately choose to use the NEC chipset [,]"
  6. ^ ElectronicNews Newspaper, Inc. (1997) 3Dfx sues Sega, NEC over contract p1 - Citing 3Dfx Director of investor relations Laura Onopchenko; "Sega received under the false pretenses of the development contract, confidential design and development information and materials, all of which were proprietary and highly confidential property of 3Dfx."
  7. ^ BusinessWire, Inc (1998). 3Dfx, Sega, NEC and VideoLogic settle 3Dfx[]lawsuit Published on August 4, 1998. Retrieved from http://www.allbusiness.com/legal/legal-services-litigation/6861052-1.html on February 12, 2009.
  8. ^ Pettus, Sam. "Eidolon's Inn: SegaBase Dreamcast p2". Eidolon's Inn. http://www.eidolons-inn.net/tiki-index.php?page=SegaBase+Dreamcast+p2&bl=y. Retrieved 2011-04-24. [verification needed]
  9. ^ a b c d [1]
  10. ^ a b c d "Sega Dreamcast". Game Makers. G4 (TV channel), Los Angeles. 2008-08-20. No. 302.
  11. ^ "Dreamcast Museum". Chronicgames.net. http://www.chronicgames.net/articles/dreamcast-museum.aspx. Retrieved 2008-08-11. 
  12. ^ Maclean's 24 September 1999.
  13. ^ "Dreamcast beats PlayStation record". BBC News. 1999-11-24. http://news.bbc.co.uk/2/hi/business/534957.stm. Retrieved 2008-08-19. 
  14. ^ "Sega Sports NFL 2K1 Outsells the Competition on Its Debut; First Ever Online Console Game NFL 2K1 Becomes Number One Football Game This Fall". Business Wire. November 28, 2000. http://findarticles.com/p/articles/mi_m0EIN/is_2000_Nov_28/ai_67385294?tag=artBody;col1. Retrieved 2008-08-19. 
  15. ^ [2]
  16. ^ "Price Cut Leads to Surge in Dreamcast Sales". Manjiro Works. http://www.manjiro.com/japannewsocttodec2000.html#anchor113244. Retrieved 2008-08-19. 
  17. ^ "PlayStation 2 Timeline". GameSpy. p. 3. http://archive.gamespy.com/articles/february04/ps2timeline/index2.shtml. Retrieved 2008-08-19. 
  18. ^ a b [3]
  19. ^ [4]
  20. ^ [5]
  21. ^ [6]
  22. ^ Nick Gibson (2006). "Sega exits the console business". Games Investor. Archived from the original on 2007-12-12. http://web.archive.org/web/20071212004605/http://www.gamesinvestor.com/Research/Thinkpieces/Past_Thinkpieces/Sega_exits_the_console_busines/sega_exits_the_console_busines.html. Retrieved 2006-09-15. 
  23. ^ [7]
  24. ^ [8]
  25. ^ "Sonic signs for Gunners". BBC News. 1999-04-22. http://news.bbc.co.uk/1/hi/sport/football/326010.stm. Retrieved 2007-07-19. 
  26. ^ "SEGA EUROPE strikes third major European sponsorship deal with A.S. SAINT-ETIENNE". PRnewswire.co.uk. 1999-06-15. http://www.prnewswire.co.uk/cgi/news/release?id=50451. Retrieved 2007-07-19. 
  27. ^ "SEGA EUROPE strikes sponsorship deal with U.C. SAMPDORIA". PRnewswire.co.uk. 1999-06-11. http://www.prnewswire.co.uk/cgi/news/release?id=31106. Retrieved 2007-07-19. 
  28. ^ "SEGA announce new price for Dreamcast". SEGA. 2000-09-01. http://www.sega.co.jp/corp/release/2000/0901_4/. Retrieved 2007-07-19. 
  29. ^ a b c [9]
  30. ^ "Peter Moore Killed The Dreamcast". Retrieved on 15 September 2008
  31. ^ "Sega Scraps the Dreamcast". BBC. 2001-01-31. http://news.bbc.co.uk/1/hi/business/1145936.stm. Retrieved 2008-08-22. 
  32. ^ "Dreamcast Price To Drop | The Hollywood Reporter | Professional Journal archives from". AllBusiness.com. 2001-07-25. http://www.allbusiness.com/services/motion-pictures/4861440-1.html. Retrieved 2011-12-16. 
  33. ^ [10]
  34. ^ Boyes, Emma (2006-10-24). "Lik-Sang sunk by Sony suits - News at GameSpot". Gamespot.com. http://www.gamespot.com/news/6160381.html. Retrieved 2011-12-16. 
  35. ^ Powell, Chris (2006-10-24). "Lik-Sang goes out of business, tells their side of story [Update 1". Joystiq. http://www.joystiq.com/2006/10/24/lik-sang-goes-out-of-business-tells-their-side-of-story/. Retrieved 2011-12-16. 
  36. ^ "Sega bringing Dreamcast library to PS3, Xbox 360". USA Today. 2010-06-10. http://content.usatoday.com/communities/gamehunters/post/2010/06/sega-bringing-dreamcast-library-to-ps3-xbox-360/1. 
Retrieved from "http://en.wikipedia.org/w/index.php?title=History_of_the_Dreamcast&oldid=473469699"
Personal tools
Namespaces
Variants
Actions
Navigation
Interaction
Toolbox
Print/export