In September 1999, Sega released Dreamcast in the US.
Excellent, excellent system.
It's cool graphics you've never seen before.
It's more realistic
It's more exiting.
We have a lot, thank you on the Dreamcast
Why is a groundbreaking piece of technology?
But perhaps that didn't matter,
the company was already doomed by a single moment.
On this stage, three years earlier.
After a decade of developing console's without much success,
Sega finally made it to the top of the market with their 1989 release of Sega Genesis.
Initial sales were underwhelming.
But in 1990, Sega CEO Hayao Nakayama
hired Tom Kalinski as president and CEO of Sega of America.
Kalinski's detailed plan for the Genesis lowered
the price and developed games specifically for the US market.
Sales skyrocketed.
For the next seven years,
Sega maintained their position at the top.
When Nintendo released Super Nintendo in 1992,
Genesis matched their initial growth.
In total, Nintendo sold 23.3 million Super Nintendos in North America.
Sega sold 22.4 Million Genesis consoles.
By 1992, Sega was beginning to develop their next console, Sega Saturn.
It was an impressive piece of equipment for the time,
and in late 1993,
the design was just about finished.
But then, someone else joined the party.
Your worst nightmare has arrived.
PlayStation.
Sony spent 1994 hyping their first gaming system,
a 32 bit, 3D capable CD-ROM based console Play Station.
Sony was going to get to video games because it was already buying a movie studios.
It was moving into becoming a multimedia empire.
That's Ken Horowitz, a Sega aficionado.
Sega Genesis is my favorite console of all time.
That's my Genesis collection.
I have almost 500 games, all complete.
He runs the website Sega 16,
and has published two books on the history of Sega.
Sony had money, resources,
and a distinctive marketing campaign.
Wallman Nintendo and Sega had always sold to kids and teens,
Sony was targeting adults.
Their edgy ads incorporated dark styles and matured themes.
Excuse us Mr Logan.
Playstation was cool.
PlayStation was the future.
Sega panicked.
Saturn was scheduled to hit stores in autumn 1995.
The console was in production.
Retailers were placing orders,
but Sony was also preparing for an autumn launch.
So, Sega CEO Hayao Nakayama and Tom Kalinski made a rash decision.
Since I began, my remarks we are going to announce [inaudible] another.
We started our roll out of Sega Sartun yesterday.
Sega was already on shelves.
Nakayama decided to get Saturn out early,
and establish itself in the American market before PlayStation had
a chance for a price of $399.
But there was a big misstep here,
Sony was at the same conference and had yet to present
Two ninety nine.
That's right.
Sony announced PlayStation would be $100 less than Saturn.
When Steve Race got up there and just said $299 and walked away,
that was like a blow to the stomach for a lot of people and Sega of America.
Saturn was more expensive arguably less
technically capable and simply not ready for retail.
All of Segas retail partners Kaybee Toys R Us trade antique
Babbage's were getting ready for a September its third party companies Konami,
Capco and all those guys were also getting
green and also because come and say no we're going to release in May.
First of all, there wasn't enough product,
so they only released decided to search stores and
companies like Kaybee decided they were so mad they didn't carry it at all.
Saturn's early release gave Sony more time to build hype.
Do you want a piece of me? You want some of this?
Sony was also able to watch the market react to Saturn
and improve the performance of the PlayStation before their autumn release.
Sony had four months to track Sega's sales,
and then just immense amount of marketing dollars,
and just release the console everywhere.
Sony released PlayStation in North America on September 9th, 1995.
The fight wasn't even close.
Between May and September,
Sega sold 80,000 Saturns.
Sony sold 130,000 PlayStation's in the first week.
In March of 1996,
Sega lowered the price to $249, but it was too late.
Later that year Tom Kalinski resigned.
In total Sega sold just 9.2 million Saturn units worldwide.
Sony sold 102 million PlayStation's.
Sega gave consoles one last shot with the release of Dreamcast in 1998.
The North American launch of the Dreamcast was an absolute unmitigated success.
It was just brilliant.
But again, Sony was one step ahead.
Sony had a lot of money to throw behind the blade than Sega did.
Sega didn't have the cash reserves to promote it to market,
and push that Dreamcast the way so we had with the PlayStation.
Sega's days of developing console's were over.
To this day, Sega is still making games and they're making money.
In 2017, they reported a profit of 243 million.
And every now and then rumors surfaced suggesting another Sega console.
Please leave your comments below and don't forget to like and subscribe.