Things had been rough for Sega for those four years since the release of the Saturn in 1994. Practically out of the gate, Sony had managed to undercut them on price with their first PlayStation console and Sega rushed the console out to stores (a surprise launch leaving no lead time for consumers) in a backfiring effort to get out ahead of Sony, third-party developers found the architecture and operating system difficult to work with, and Sega as a company was still in the throes of a bitter rivalry between its Japanese and American branches, throwing the company into misstep after misstep. The 32/64-Bit console generation was starting to wane and Sega sought to turn its fortunes around with the Saturn’s successor.
So Sega was torn: the new generation was looming on the horizon, and while they did have a stable of developers who had found a way to thrive on the system, its executives didn’t want to be caught flat footed again. So in 1997, Japan and America CEOs Hayao Nakayama and Bernie Stolar set out to begin exploration and development of new hardware for what would become the Dreamcast. Wanting to cover their bases, the two CEOs set up two primary teams to pitch the hardware design for the console: an American team with IBM Austin engineer Tatsuro Yamamoto as its lead and a Japanese team with internal Sega engineer Hideki Sato heading it up.
While both teams would eventually settle on Hitachi’s SH-4 processor as the CPU, they would take two different approaches for the graphics processing unit for the machine. Yamamoto and the American team’s pitch, “Blackbelt” would gravitate towards popular PC gaming hardware developer 3dfx Interactive’s Voodoo 2, popular for use in PC gaming in the late 90s. Sato’s team in Japan, meanwhile, approached VideoLogic and NEC to utilize their graphics technology in the form of the PowerV2 2 chip. Unfortunately for both teams, both of these choices would have unforeseen repercussions for Sega in the short years ahead.
With the chipsets settled, the Sega heads began to debate which of the two would be the path forward on the new console. The Voodoo was powerful, and certainly had familiarity for western development, but at the time Sega still reeled from the failures of the Saturn. It was established that the price of the system could not repeat the sticker shock, nor room to be so readily undercut by competitors, that had haunted the Saturn with it’s original $400 1994 release price. In that sense, the powerful PowerV2 chip, which had already showed promise by outpacing Sega’s $6000 Model 3 Arcade hardware, had a key advantage by keeping costs low, around a then-price of approximately $99 per chip. This in turn allowed Sega to create a new generation arcade board designed around the Dural build, NAOMI, allowing easy porting from the company’s arcade division to home releases.
However, the first of the troubles with Sega’s foray into the Dreamcast would rear its head. 3dfx Interactive, who had seen details on the chipset and deal with Sega repeatedly leaking into the gaming press during the prototyping period thanks to their initial public offering in 1997, sued Sega over breach of contract after the company decided to pursue Sato and teams’ design. President and CEO Greg Ballard accused Sega at the time of having “terminat[ing their] contract without justification,” despite meeting the company’s contractual commitments. While the eventual amount paid to 3dfx was not disclosed, industry news site Techmonitor reported around the time of settlement in the summer of 1998 that it was “substantial compensation over the settlement,” for damages of $105 million dollars; it was a not-insubstantial blow to Sega’s then precarious financial state.
Sega pushed ahead with Sato and team’s design, codenamed “Dural” (after one of the boss fighters from Sega’s Virtua Fighter franchise) and, subsequently, “Katana” as the hardware design for the Dreamcast. Understanding that they couldn’t repeat the past with the Saturn’s difficult design, Sega looked into two operating systems that would be capable of running on the Dreamcast: a native OS of Sega’s own design, and a branch of Windows CE that could be utilized for porting existing games PC games to the machine. Word had it that even with this design in mind, the Windows OS still proved somewhat thorny in practice, and Sega themselves felt that their own OS was far more capable than the version of Windows they utilized (indeed, staffers such as Sonic Team lead Yuji Naika would brag that it would be impossible to port titles such as Sonic Adventure to the PC as the Dreamcast outpaced their capabilities).
Still, there was more to add to final specs of the Dreamcast before it would launch. American CEO Stolar believed in a forward looking approach for the console; in his own 20th anniversary retrospective, The Ringer’s Ben Lindburgh spoke with Stolar who revealed the three features he pushed for: DVD capability, onboard storage and online capability via modem. Only the latter would make the cut, with Stolar telling Lindburgh that he sacrificed the other two planks in exchange for the modem, a detachable 56k unit, which would come packed in with the system allowing it to be upgraded to a broadband modem as internet access advanced in Japan, America and Europe. “[M]y plan was to add those later.” In lieu of DVD Capability, the Dreamcast instead used a Sega proprietary disc, the GD-ROM. Capable of storing 1GB, a quarter of the storage for a standard DVD, the GD-ROM disc would eventually prove to be one of the failure points of the Dreamcast in its ease of piracy in an age of rapidly accelerating broadband access and CD-Burners becoming standardized inside home PCs. And like the PlayStation Dual Shock controller, Stolar argues that he fought initially for a dual-stick design for the Dreamcast controller, losing out to internal politics within Sega at the time, leaving users with a controller that would lack full parity not just with the upcoming PlayStation 2 from Sony, but even with later generation PlayStation titles, many of which would still find ports making their way onto the system.
Like the PlayStation, however, Sega found itself pursuing an innovative experiment in memory card design. Beating Sony’s PocketStation to the punch by a few months, the Visual Memory Unit of the Dreamcast combined the removable save game storage capacity that had preceded it in the Memory Cards and Memory Paks of the PlayStation and Nintendo 64, but featured an LCD screen and built-in controls that would allow minigames to be downloaded from the main game onto the VMU, allowing players to continue and augment their experience beyond the Dreamcast. Not only that, but the controller had been designed such that when the VMU was slotted in, the VMU screen could be viewed through a cutout above its dual-accessory sockets and allow players a screen where additional information or effects could be displayed during gameplay. Users could even connect VMU’s together via the docking ports at the top of the unit to play mini games together or transfer data from one unit to another.
All innovative features at the time, but ones somewhat hampered by the short life provided by the two button-cell batteries that would power each unit. And given the limits of onboard flash storage at the time, users would often require multiple VMUs if they maintained even a moderate sized library of Dreamcast titles, or even just frequent rentals, meant users would burn through batteries constantly given the VMU’s particular problem of eating through them even when not in active use.
In the Spring of 1998, Sega officially unveiled the Dreamcast to the public, slating the console’s Japanese release later that year in November. However, this resulted in several drawbacks for the release. First, the system had a launch lineup of only four titles: suspense visual novel July, quirky mascot racer PenPen TriIcelon, a home port of their hit arcade fighter Virtua Fighter 3tb and the kaiju city destroyer Godzilla Generations. While Sonic Team’s upcoming Sonic Adventure had been shown off that August to demonstrate the capabilities of the system, it would not be released until a month after release, a couple short days before Christmas, and other games planned for Sega’s initial weekly release schedule to fill out the rest of 1998 either saw themselves pushed back into the depths of 1999 or cancelled entirely. Then came the second stumbling block: the PowerVR Series 2 chip shortage.
Initially, Sega had been forecasting distribution of 500,000 units for the Japanese launch. NEC, meanwhile, had run into manufacturing problems that resulted in a third of chips being unusable for production. The 500,000 expected consoles now had been cut down to barely more than a fifth of that number, just 150,000 units, forcing Sega President Shoichiro Irimajiri to place an early end to preorders, allocating only 80,000 units for pre-sale and distributing the remainder to stores across Japan. In the short term, the console sold out.
Pricing had been a point of contention within Sega. Executives within the Japanese branch of the company had hoped to sell the machine at a price that would generate profit from the start, while back in America Stolar had been insistent on maintaining a $199 price tag. After internal fighting subsided, Stolar had come out on top, but the result meant that Sega now lost money on each unit sold, a loss leader system where they would be dependent on making back costs elsewhere. At the Japanese launch, the system retailed for ¥29,000, but aggressive marketing (which would end up leading to a raid on Sega by Japanese police) saw Sega drop the price to ¥19,900 within months, and cut the launch title prices to ¥1990; the plan did work however: sales skyrocketed 10,000%, and by May of 1999 Sega broke one million units sold in Japan.
For the American launch, Sega had decided on the marketing friendly date of September 9th, 1999, a catchy “9/9/99” release that would allow the company time to study how things progressed in the Japanese market (still seen by Sega at the time as their primary sales market for the console) and build up a library of games that could launch alongside the system, such as the hotly anticipated Sonic Adventure, the Blue Blur’s first true foray into 3D game design (although on the Saturn both Sonic and friends racing game Sonic R and Genesis/MegaDrive mainline game collection+historia release Sonic Jam were or featured 3D gameplay in their own rights). And to help build additional hype around the system, Sega utilized its nearly one year lead time to do a pre-launch rental partnership with Rental Store Hollywood Video, a marketing campaign where interested parties could rent a system and Sonic Adventure in the months ahead of the launch that same summer (or, if you were to eat the $350 deposit on the unit, snag an early one for yourself ahead of anyone else).
The Dreamcast, however, would have to launch without Stolar and Nakayama. As Sega’s financials continued to decline, particularly in the wake of failed merger with toy and animation corporation Bandai (who would later go on to form a successful merger with fellow video game developer Namco), Nakayama resigned his position within Sega, with President Irimajiri taking over duties in his stead. Stolar would subsequently continue butting heads with executives above him at Sega of Japan and leave the company as well before release (Stolar would, eventually, join and head up EA’s sports gaming division years later).
Even without the two executives, and particularly Stolar who became the face of the console within the American industry, the Dreamcast successfully hit American shelves on 9/9/99 and at the $199 price point that Stolar had hoped would give it a significant edge against its competition, including the upcoming PlayStation 2, which had been formally announced just a few months prior for release the following year. The Dreamcast would launch in North America with eighteen games: Sonic Adventure, Soul Calibur, Typing of the Dead, Power Stone, Ready to Rumble Boxing, NFL 2K (developd by Visual Concepts, then recently acquired by Sega and still stands today within Take-Two and 2K’s corporate hierarchy), NFL Blitz 2000, TNN Motorsports Hardcore Heat, Hydro Thunder, Mortal Kombat Gold, Blue Stinger, Trick Style, Expendable, Monaco Grand Prix 2, Tokyo Extreme Racer, PenPen TriIcelon, Flag to Flag, Air Force Delta and Aerowings. Before the year was out, the American market alone had sold over a million units, with the European market following it later that year with a launch a month later (possibly because of issues with rolling out the online service for the European market).
Yet in little over a year Sega would announce the console was dead. The PlayStation 2 would launch in the spring of 2000 at an effective price point of $300, Sega scrambling to compete by slashing their loss leader by another $50, while Nintendo was already preparing its own next generation console in the GameCube, and Microsoft loomed on the horizon with the first Xbox console, including the first Halo title, which would revolutionize the console first person shooter experience. Sega had also run into trouble with aborted deals with Electronic Arts, which resulted in the developer’s popular series of sports titles never setting foot on the console; while EA Sports vs 2K Sports would be a long running rivalry through the period, being able to find titles like Madden on the PS2 contributed to Sony’s machine outpacing the Dreamcast in sales. As well, Sega had also alienated some Japanese developers, who felt that the system came too soon when they were still working well within the capabilities of the Saturn, leaving less studios to devote effort to Sega’s console in lieu of producing titles for its competitors. With so many factors and more coming together against it, on January 31, 2001, Sega of America President Peter Moore, who would later join Microsoft’s Xbox division, announced the company was ceasing production of the Dreamcast and stepping out of hardware production entirely, transitioning to be a third party software developer. The Dreamcast sold, ultimately, six million units in total worldwide.
Despite all this, the Dreamcast
still has a strong place in the heart of many gamers from that era. It’s easy to chalk so much of the vibe up to nostalgia for our childhoods, but there was a palpable sense of future and possibility that surrounded the culture of the Dreamcast. It was a system in transition, for better and ill: a bridge between the old era of consoles and the modern. It was a system where you could still go out and buy a dedicated
fishing controller and then boot up a broadband modem to go play Phantasy Star Online with your friends. A console boasting countless experimental home original releases while still itself being home to bringing the arcade experience home.
Yet it was also the only console that featured a single analog stick while all of the other consoles for its generation would feature two, a choice which would inevitably restrict the possibilities interfacing with games on the system, particularly in an era where more and more games would come to depend on the second stick for more intuitive camera control in 3D space. And in an era where the PlayStation had already introduced in-controller rumble a with the initial DualShock, and would make it a standard feature for the then upcoming PlayStation 2, the Dreamcast was stuck with an N64-esque Rumble Pack taking up one of it’s accessory slots in the controller (the other, of course, necessarily occupied by your VMU).
The Dreamcast operated in this liminal space between what had been and what could be; a familiarity that allowed users to jump into play immediately while dabbling in the promise gaming’s future. But between the limitations of hewing to rapidly outdating hardware decisions, the repercussions of failed company partnerships, and the oncoming train of the PS2 and the rest of the new generation of consoles, the potential the Dreamcast was cut short in just those three short years of life.
Even still, twenty-five years later, it lives on in the memories of its fans, an unforgettable touch stone and the representative of an end of an era in the history of video games.
Sources:
Posts
https://youtu.be/mk9XI4aOqN8?feature=shared
https://youtu.be/JL5-sx2A0-M?feature=shared
And from five years ago, Giant Bomb West’s Dreamcast 20th Anniversary Stream:
https://www.youtu.be/8cymPf8sFIk
Nice writeup.
I left the console wars for PCs by then, but followed them in the news/gossip. The fighting between the different regions is so wild, I know they were all like that.
I certainly enjoyed what little time I was able to have with it played at friends' houses, as well as the games originally released for it that were ported to other consoles.
https://www.youtube.com/watch?v=HNy_retSME0
Rock Band DLC | GW:OttW - arrcd | WLD - Thortar
https://youtu.be/V4r91lkxOHo?si=wCraHnZvDVP759Ge
https://www.youtube.com/watch?v=R4obFb3EWGw
The Exploration/Combat sequences are slightly more delineated between than in Yakuza (nowhere as seamless, at least early on), but the feel of the action RPG design feels like it carried on into Yakuza/RGG/LAD, and also the irreverent sense of humor as well.
3DS: 0473-8507-2652
Switch: SW-5185-4991-5118
PSN: AbEntropy
Like go play Gundam 0079: Rise from the Ashes, and you will not be able to escape the sense that this game would make so much more sense if the controller had a second stick so you could turn the camera with that instead of the far more cumbersome sensation that comes from, like, moving forward+back+strafing with the D-Pad while adjusting your view with the single stick that is… directly above the D-Pad you are using to move around, forcing you to repeatedly try to alternate between adjusting your view/aim and moving.
sonic adventure 2 aged better imo
RIP sega
The Dreamcast was the final statement of Sega as a hardware manufacturer, some real hustle-worthy marketing. and some really innovative 1st party titles covering up a myriad of poor background decisions that kept them firmly as an also-ran.
That said, the Dreamcast also was the last console that felt like it was stretching for something really weird and would be something you'd see on a sci-fi show, so there's some charm to the design.
It's the only retro console that hasn't been sold or replaced by a mini-fied version of itself, even though the battery for the system memory has gone and I'm not confident enough to pry it open and replace it.
I think I originally got it to play Code Veronica and what an absolute slog that was.
-Shenmue II
-Resident Evil: Code Veronica
-Shenmue
-Jet Grind Radio
-Samba De Amigo
3 original franchises (2 entries from the same series even) and 1 decently received regard entry from a fairly well regarded series. They absolutely had the software down, they just completely biffed on the hardware rolls and that was it.
Port it again to Steam please whoever owns that IP. Or remaster it. Or make a sequel.
My buddy had the Dreamcast and we would just sit down and run the entire game every month or so.
I didn't get much time with the Dreamcast, so I don't really have an opinion.
Also ot pretty unquestionably had the single best launch day lineup of all time
http://www.audioentropy.com/
Sorry you didn't get a fairer shot, Dreamcast
also drove a bunch of fork lifts around and asked about china
What a rad system.
https://steamcommunity.com/profiles/76561197970666737/
This takes me back to my sophomore year of college where my one friend who owned one had a similar class schedule as me, so every afternoon went:
2:40 - Crazy Taxi, THPS2, Chu Chu Rocket, Soul Calibur, etc (basically the games we could do rapid turns or multi-player)
3:30 - Toonami
4 - start walking the 1.5 mile hike to the marching band practice field
We eventually moved to Shenmue/Skies when they came out later in the year (me watching him), and then when marching band was done, we had a little more time since we only had to walk to the music building on campus for Symphonic Band rehearsal, so we used the extra 15 minutes to sneak in some Soul Cal
fantastic value, loved a lot of what I played
absolutely no surprise that the console crashed and burned, like holy shit what were they thinking
Jet Set Radio was the last game I recall seeing an advertisement for and thinking 'it can't possibly really look like that'. Oh, it did, and then some.
I always wanted to arrange a fanfare version of the opening of Funky Radio and our show opener would be like us tuning/warming up and then BAM scream trumpets parting your hair with this (0:16 to 0:43) and then the rhythm section would keep the groove going while our singer introduced us
https://youtu.be/8oQC1FuWB10?si=fLWyHpiXy3c9R6O_
I made a game, it has penguins in it. It's pay what you like on Gumroad.
Currently Ebaying Nothing at all but I might do in the future.