Looking back over Sega’s two-decade stint as a first-party console manufacturer, what truly stands out in the cold light of retrospection is the fact that the company seemed to languish in the trenches of the eternal underdog. No matter how hard Sega worked, no matter how good their software output, no matter how compelling their hardware, Sega never seemed able to step out of the long shadow cast by Nintendo and Sony. Even this volume tends to be couched in terms of Sega’s efforts via-a-vis those of the competition; history is written from the winner’s perspective, and even in hindsight it’s difficult not to define the company by the games and consoles that outsold it.
If ever Sega truly defined itself as a console-creating entity in its own right, however, that shining moment of glory came in the 16-bit era courtesy of the Genesis. Unlike Sony and Nintendo, Sega never enjoyed a dominant market share in every major region (Japan, the U.S., and Europe) simultaneously. But Genesis came close. Had its Japanese version, the Mega Drive, been able to loosen Nintendo’s grip on its home territory, the company would have dominated the 16-bit market—at least for a little while.
For the sake of simplicity (and its familiarity to the majority of this issue’s writers and readers), let’s look strictly to the Genesis’ performance in the U.S. Certainly the Mega Drive was no failure in Japan and definitely not in Europe, but America offered Sega’s most significant inroads during that generation. The Genesis started strong and maintained a healthy market share lead for years in the U.S., a fact people often attribute to the strong showing of sports franchises Ike EA’s Madden NFL games or the system’s two-year lead oer the Super NES. And yes, these factors certainly figured in to Sega’s success story.
Ultimately, though, the secret of Genesis’ American triumph had more to do with a single key business decision: For the first time ever, a parent company looked to the prospects of its game hardware in a foreign market and told its overseas branch, “You know what? You guys understand this market better than we ever will. Do what you need to.”
According to an interview with former Sega Of America president Tom Kalinske published on sega-16.com, Sega’s U.S. branch was given more or less carte blanche to sell the Genesis to American audiences. The tactics Kalinske’s team settled on didn’t sit well with Sega of Japan’s executives; they thought it folly to sell the hardware at an insanely low price and pack in a premium title like Sonic the Hedgehog for free. The aggressive, Nintendo-taunting advertising campaign Sega used to promote the Genesis flew in the face of Japanese business etiquette and social protocol.
Yet Kalinske rightly gauged the U.S. market, and Genesis quickly became a sensation. In the early days, it offered remarkable audio/visual power at a compelling price. Before long, it also offered well-made software by Western developers, who had been sorely under-represented on Nintendo’s NES. Once the Super NES finally launched in 1991, the Genesis took it head-on: Sega offered a more robust library of software that seemed refreshingly free of the sluggishness and slowdown that plagued so much early SNES software.
Nintendo, accustomed to the comfortable complacency of undisputed victory, suddenly found itself threatened. Its easy rule over 90% of the U.S. market in the 8-bit days suddenly plummeted to a threadbare majority made possible only by the slow retirement of the NES juggernaut. On an apples-to-apples basis, the Super NES lagged as far behind the Genesis’ uptake as its shooters did their Genesis counterparts’ frame rates. Sega even managed to make Nintendo’s evergreen champion of commerce, Mario, seem painfully uncool next to Sonic the Hedgehog—the worst crime imaginable in a market dominated by image-conscious teens and pre-teens.
The ruthlessness with which Sega of America dismantled Nintendo’s rule deserves no small amount of admiration. Nintendo offered cool special effects built right into the hardware? Sega countered with “Blast Processing”—essentially just a marketing term for better-optimized programming, but one keenly crafted to highlight the deficiencies of early Super NES software. Super NES launched with gotta-have-it platform powerhouse Super Mario World? Sega swapped out abysmal pack-in Altered Beast in favor of Sonic the Hedgehog, along with a campaign ruthlessly mocking Mario and making Nintendo seem hopelessly square. Nintendo locked up an exclusive home port of earth’s hottest arcade game, Street Fighter II? Sega rolled up its sleeves and let Midway publish Mortal Kombat on Genesis with full gore intact, leaving Nintendo’s goofily sanitized version a laughingstock.
And so it went, a chess match of move and countermove. Super NES made its inroads in the U.S. market to be sure, but Nintendo found the 16-bit era a painful challenge in the world’s largest (at the time) console games market, especially after the cakewalk the NES enjoyed. Ultimately, Nintendo had to pull out all the stops: Special add-on chips, sophisticated middleware tools to fake next-gen graphics, and ultimately even trying in its own nebbish way to mimic Sega’s confrontational advertising style.
In the end, the Super NES’s eventual market share lead came in at a razor-thin majority and likely had as much to do with Sega’s own internal friction as any clever tactics by Nintendo itself. The massive success of Genesis in the West, on the West’s own terms, didn’t inspire Sega’s leadership to further explore that style of autonomy; on the contrary, but most accounts it fostered a sense of jealousy and resentment within the Japanese management and allowed a rift between the two divisions of the company to form. The two branches began working in opposition rather than unison, with Japan placing ever greater pressure on the U.S. division to do things their way.
This fractious relationship began to wear at Sega’s coherency, which probably explains why they thought releasing 32-bit add-on 32X a year before the 32-bit Saturn’s launch made any kind of sense. It would find its ultimate manifestation in the dual development pipelines for the Dreamcast, which saw both the Japanese and U.S. offices designing completely different machines and Japan going with its own specs despite the alleged superiority of the American design.
But that’s a story for another time. The Genesis years, brief as they ultimately proved to be, represented Sega’s finest moment: The one time in its history where great software found itself matched by equally excellent hardware, suitably canny business sense, and much-deserved success in the marketplace.
Article by Jeremy Parish
GameSpite Journal 12: The Deuteronomy of Genesis