Review of Retro Gamer's 32X "Retroinspection"

[kool kitty89]

This was my point, smaller companies have more stringent finances (and mentalities) and therefore cannot afford to do what Sony did.

That-is until small companies become big companies (like Nintendo did) . . . or if management goes crazy with spending while credit is good. (which, by some accounts, is exactly what Sega did, and one of the biggest things that hurt them in the long run -though there's too many unconfirmed claims to really solidify this argument IMO)

Regardless of just how much Sega over-spent and when, they certainly did a poor job of making that money count in some key circumstances, and they continued to pour money in when they could afford to less than contemporaries. (especially compared to Nintendo, who definitely could have afforded to pour much more into marketing and price-reduction than they did historically -albeit it cost them significant marketshare and revenue in several instances, but they did manage to remain financially sound . . . perhaps more to luck than smart management though -or, more specifically, managing a 10+ year near-monopoly in Japan and close to 5 years in the US -had Sega had Nintendo's kind of money in the bank, they too could have afforded to make huge mistakes and recover from it -like MS and Sony also managed to do)

But really, there's some pretty obvious cases where Sega seemed to pour money into things to little effect when they could/should have been much more conservative. (like the the Dreamcast -at least looking at the US- they were good to put such heavy force on advertising and PR as well as the low launch price, but they went overboard on additional price cuts that did little to improve sales -after all, the DC was already the cheapest next-gen console on the market, so there was no price-war this time- and they went oberboard on the internet deals too -prominently supporting online play is one thing, but investing in SegaNet and packing in the modem free cost them big-time when they couldn't afford to take such risky investments -given their situation, they should have been digging in for stability for the long haul, not trying to make a splash and wow the masses with a risky unestablished concept)

[sheath]

EGM August 1995. Doom 32X is in the top 50 games list at 19th place with no comments about fart sounds. BRE Software ceased to list 32X hardware and software, and no longer has the 32X library listed as a buy back option. The rest of the catalogs have 32X games listed as usual.

[sheath]

That-is until small companies become big companies (like Nintendo did) . . . or if management goes crazy with spending while credit is good. (which, by some accounts, is exactly what Sega did, and one of the biggest things that hurt them in the long run -though there's too many unconfirmed claims to really solidify this argument IMO)

Regardless of just how much Sega over-spent and when, they certainly did a poor job of making that money count in some key circumstances, and they continued to pour money in when they could afford to less than contemporaries. (especially compared to Nintendo, who definitely could have afforded to pour much more into marketing and price-reduction than they did historically -albeit it cost them significant marketshare and revenue in several instances, but they did manage to remain financially sound . . . perhaps more to luck than smart management though -or, more specifically, managing a 10+ year near-monopoly in Japan and close to 5 years in the US -had Sega had Nintendo's kind of money in the bank, they too could have afforded to make huge mistakes and recover from it -like MS and Sony also managed to do)

The only rule of thumb I have ever seen is that only those who take huge risks make great returns. The "sure thing" comes along so rarely, and randomly, that it just cannot be counted on. If playing it safe and counting the money in advance was the best business practice, Rosen never would have started importing machines into Japan to entertain US soldiers. Company culture is a very important thing to consider when trying to create "what if" scenarios as to what might have been done better.

But really, there's some pretty obvious cases where Sega seemed to pour money into things to little effect when they could/should have been much more conservative. (like the the Dreamcast -at least looking at the US- they were good to put such heavy force on advertising and PR as well as the low launch price, but they went overboard on additional price cuts that did little to improve sales -after all, the DC was already the cheapest next-gen console on the market, so there was no price-war this time- and they went oberboard on the internet deals too -prominently supporting online play is one thing, but investing in SegaNet and packing in the modem free cost them big-time when they couldn't afford to take such risky investments -given their situation, they should have been digging in for stability for the long haul, not trying to make a splash and wow the masses with a risky unestablished concept)

These are all examples of things that could have made everything better for Sega. Nobody, and I mean nobody, not even Sony, knew that SegaNet wasn't going to change everything about the console gaming business. It was huge. The single most important thing to remember when looking back is that total immersion in the thoughts and research of the time is necessary before coming to conclusions.

[kool kitty89]

The only rule of thumb I have ever seen is that only those who take huge risks make great returns. The "sure thing" comes along so rarely, and randomly, that it just cannot be counted on. If playing it safe and counting the money in advance was the best business practice, Rosen never would have started importing machines into Japan to entertain US soldiers. Company culture is a very important thing to consider when trying to create "what if" scenarios as to what might have been done better.

Risk/reward is always a factor, but once you HAVE taken the risk and gotten a large foundation to build upon with further success, the picture changes a bit and focus on stability and profitability for the long-run becomes more and more important. (and managing that without turning into a bureaucratic mess is another problem -one way to solve that is creating semi-autonomous spin-offs, but few large corporations ever seem to do that, unfortunately)

These are all examples of things that could have made everything better for Sega. Nobody, and I mean nobody, not even Sony, knew that SegaNet wasn't going to change everything about the console gaming business. It was huge. The single most important thing to remember when looking back is that total immersion in the thoughts and research of the time is necessary before coming to conclusions.

The problem is that Seganet did nothing form them: heavily promoting online gaming support through standard 3rd party ISPs would have worked just as well (if not better) and, even then, they still could have employed proprietary servers to give them more control.

Offering the modem separately with accessories (keyboard+browser/etc) at a low margin as well as offering an "internet bundle" version of the DC (maybe with a limited time discount). Albeit, bundling the modem was a less serious issue than the unnecessary price drops. (again, they already had a $100 price advantage over the PS3 and it wouldn't be until late 2001 that the GC would rival the DC as lowest cost option, so that was a waste -investing in stronger advertising would have made more sense, or simply taking smaller losses and transitioning to profits on hardware sales sooner)


As it was, Sega's online gaming support was pretty successful for its time and was there from day 1 in the US in 1999 compared to Xbox live being released quite a bit after the system's launch in 2001. (certainly nothing like the Saturn netlink -which was a total waste)

[sheath]

What's wrong with Saturn Netlink? I knew a group of people on Usenet that gamed regularly with it. I wish I had known them back in the day, as I probably wouldn't have bought my first computer if I knew my Saturn could do everything online anyway.

My point about SegaNet, which launched in 2000, not 1999, is that it was a game changer, particularly because of the free Dreamcast deal. Sony reps were quoted as saying this was a paradigm shift in console distribution, it was that huge. The fact that it coincided with the Dreamcast being overshadowed by PS2 hype doesn't change how significant and industry changing SegaNet was. I doubt Xbox Live would have launched as early as it did if not for Saturn Netlink and SegaNet. Just look at how long it took Sony and Nintendo to even get online with most games.

As for managing a successful business, everything operates on a bell curve, everything starts, rises, plateaus and declines, everything. The only way to prevent the decline is to skip the plateau, the only way to do that is to jump rails to something new while the momentum and synergy is just looking great. This is the way everything works. Even peasant revolts in the middle ages happened right as things were starting to look better, and basic subsistence needs were finally being met.

Sega may not have done the right things at the right times, but diversifying and trying new things while they had the resources and momentum to do so was the right thing to do. My theory on why all of their attempts failed to establish them as a hardware manufacturer still needs more contemporaneous support from primary sources. I happen to know first hand though, that Sega in the US was always, and I mean always even in the Genesis days, considered a "generic" by the masses. Nintendo and then Sony PR and advertising, and game magazine articles always show this attitude. It was pretty much only with the Sega CD, 32X and Saturn that Sega tried to break that image and take off as a major platform holder. I think the general public's unforgiving first impression judgement of the company just could not be broken, it was too easy for other companies to remind everybody that Sega was somehow "less", and that is exactly how marketing works.

[kool kitty89]

What's wrong with Saturn Netlink? I knew a group of people on Usenet that gamed regularly with it. I wish I had known them back in the day, as I probably wouldn't have bought my first computer if I knew my Saturn could do everything online anyway.

My point about SegaNet, which launched in 2000, not 1999, is that it was a game changer, particularly because of the free Dreamcast deal. Sony reps were quoted as saying this was a paradigm shift in console distribution, it was that huge. The fact that it coincided with the Dreamcast being overshadowed by PS2 hype doesn't change how significant and industry changing SegaNet was. I doubt Xbox Live would have launched as early as it did if not for Saturn Netlink and SegaNet. Just look at how long it took Sony and Nintendo to even get online with most games.

Why would it not have been as much of a game changer if Sega promoted/supported online games just as much as they did, but stuck with plain 3rd party ISPs (as it was, AT&T was the preferred 3rd party option iirc) and just supported the modem and servers similarly? (providing game servers accessed through 3rd party ISPs)

The Dreamcast's online access never hinged on the existence of SegaNet . . . SegaNet was an added investment by Sega that they'd hope would pay off in the long run (by getting a foothold as a proprietary ISP), but it did nothing for the consumer. (had there been a lack of reliable 3rd party ISPs, it would have been another story -but that wasn't the case)

As for the free Dreamcast deal, you just pointed out that it coincided with the PS2 hype and (similar to the drop in the DC's price) very well may have cost Sega much more than it was worth and reduced the DC's chance of success. (at very least, one could argue that they could have taken that same investment capital and instead put it towards a new ad campaign directly aimed at countering the PS2 hype -though, the more sensible decision probably would have been the more conservative option of just spending less and pushing for profits sooner -especially since Sega wasn't willing to sustain losses, hence the cancellation slightly later . . . in that context, lower sales earlier on with less spending and higher margins very well may have kept the DC alive and profitable enough to allow it a long life in a low-key position)

[sheath]

Why would it not have been as much of a game changer if Sega promoted/supported online games just as much as they did, but stuck with plain 3rd party ISPs (as it was, AT&T was the preferred 3rd party option iirc) and just supported the modem and servers similarly? (providing game servers accessed through 3rd party ISPs)

The Dreamcast's online access never hinged on the existence of SegaNet . . . SegaNet was an added investment by Sega that they'd hope would pay off in the long run (by getting a foothold as a proprietary ISP), but it did nothing for the consumer. (had there been a lack of reliable 3rd party ISPs, it would have been another story -but that wasn't the case)

As far as I can tell all the SegaNet ISP was a rebranded Earthlink service. Once SegaNet closed all of the customers were allowed to keep their @sega.net email accounts through Earthlink. Lots of dial up ISPs did this, you had Costco, Bluelight and others as well, but they were just sub domains to one of the major dial up ISPs. Sega said that the SegaNet ISP gave an advantage in ping times, and gave away a free Dreamcast for a 12 month subscription (which was what was called the paradigm shift), but when I shifted to Earthlink my online play was just as smooth.

As for the free Dreamcast deal, you just pointed out that it coincided with the PS2 hype and (similar to the drop in the DC's price) very well may have cost Sega much more than it was worth and reduced the DC's chance of success. (at very least, one could argue that they could have taken that same investment capital and instead put it towards a new ad campaign directly aimed at countering the PS2 hype -though, the more sensible decision probably would have been the more conservative option of just spending less and pushing for profits sooner -especially since Sega wasn't willing to sustain losses, hence the cancellation slightly later . . . in that context, lower sales earlier on with less spending and higher margins very well may have kept the DC alive and profitable enough to allow it a long life in a low-key position)

Obviously the best thing for Sega to do would have been to keep the Dreamcast on the market and pretend nothing was wrong. They should have done that with the 32X and Saturn too, but supposedly they were actually out of cash at that point and needed to liquidate in order to stay operational. At one point Pettus reported that that Peter Moore was sent back from Japan in Summer 2000 with Sega's last $500 million to make the Dreamcast a success in the states. There are other reports of Okawa bailing out Sega with his own money to support this. It didn't help that, in addition to software piracy, the media were already gnawing on Sega's reputation like a bunch of piranhas.

But back to the point, being half the price of the PS2 should have boosted the Dreamcast's sales in 2000, SegaNet and online gaming in general should have boosted Dreamcast sales, being able to use the Dreamcast as a web browser should have boosted Dreamcast sales. I can't see these attempts as wasteful just because the public was mind melded with DVD compatibility and the Playstation brand.

[sheath]

Gamepro August 1995 assures readers that Sega will continue supporting the 32X, and that 1996 will be the peripheral's defining year. No fire sales are listed, but Saturn press plainly overshadowed the 32X even while the 32X overshadowed the Sega CD.

[Team Andromeda]

What's wrong with Saturn Netlink? I knew a group of people on Usenet that gamed regularly with it. I wish I had known them back in the day, as I probably wouldn't have bought my first computer if I knew my Saturn could do everything online anyway.

My point about SegaNet, which launched in 2000, not 1999, is that it was a game changer, particularly because of the free Dreamcast deal. Sony reps were quoted as saying this was a paradigm shift in console distribution, it was that huge. The fact that it coincided with the Dreamcast being overshadowed by PS2 hype doesn't change how significant and industry changing SegaNet was. I doubt Xbox Live would have launched as early as it did if not for Saturn Netlink and SegaNet. Just look at how long it took Sony and Nintendo to even get online with most games.

Nothing wrong with the Netlink - It was sold at cost price and in Japan users had to pay to use it . SEGA Net was a Huge loss maker for DC that was the major difference really . Also SEGA never made enough use of the internet functions on the DC to really be a game changer (games like PSO came too late in the day) it really was too early for both SEGA and the market

[sheath]

I went looking for 1994 Jaguar game reviews in EGM and Gamepro, since we all know that all game hardware gets good press initially I expected to find more in 1994. Neither EGM or Gamepro even listed the Jaguar on their front covers or their table of contents through summer of 1994, so I'm having to read through every issue to see if they even reviewed some games. Atari was advertising their games at the same time in these magazines.

While I have so far come up dry for the Jaguar, I did find this little nugget interesting.

EGM June 1994:

[StarMist]

Which part do you find interesting, the reader's complaint or the editor's mild defence? -- And they certainly did review Jaguar games between them, I certainly wasn't learning anything about the Jaguar outside of magazines.
Or is it the envelope art? EGM's submitted art always looked the same. Suspiciously so, as if they found it cheaper to pay somebody to scribble and colour half a dozen envelopes than award a $60 prize. Now that would be extremely miserly, but come on, why did it always look like that? Where were djshok and synapse to take home all the prizes?

[sheath]

Hah, I found the 'Too Much Sega' letter and the response interesting. The "reader" obviously felt the way perpetuators of the Sega History narrative eventually fell in line with. The editor's response was far more kind to Sega than say Edge/Next Generation ever seemed to be, and much more in line with what I think of as a realistic view of Sega's add-ons. Looking at it as Sega "testing the waters" of CD-ROM and polygonal 3D system enhancements sounds much more logical to me than "Sega was blind, greedy, stupid and dumb too."

[TrekkiesUnite118]

The reader's opinion however is exactly what most of the common consumers thought at the time. Sega may not have actually be blind, greedy, stupid, and dumb, but that's how many consumers felt when they saw all the add-ons and the Saturn released so quickly with little support for some of them.

[sheath]

I'll say it a million times if I have to. We do_not know what the average consumer thought on the topic because there have been no polls done or published to test that. All of the evidence is anecdotal, and all of the conclusions are conjecture.

Contemporaneous evidence to the 32X in particular suggest that the general public and the gaming media were interested in the add-on from summer of 1994 through summer of 1995. Initial sales support this, but we don't have 1995 sales figures to determine whether consumer interest dropped off.

It looks to me like Developer interest dropped off, and the magazines reviewed what 32X games did come out in 1995 very unfavorably, unfairly I would say. The timing of Nintendo's fake editorial add-campaign against the 32X, in favor of the SFX chip, is interesting as well. May 1995 is when the Saturn's presence in the West became real and quite overbearing in the media, even in relation to the PS1.

Now if I were the average non-early adopter consumer and saw the 32X's price dropping, mediocre game reviews with disproportionate text to score ratios, and fewer and fewer games being released than were announced in 1995, I probably would hesitate on picking one up at that time. The picture had changed from 1994 to summer of 1995, it just hadn't swung all the way to where the journalistic narrative would have it.

The 32X was still a Genesis add-on that the media, game companies, and consumers were watching and expecting new releases for by September 1995.

[TrekkiesUnite118]

That nugget you just posted shows us a taste of the average consumers thoughts on the matter.