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It’s Been 25 Years Since Sega Of America Made Its Biggest Ever Mistake

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There’s nothing like getting a long-awaited games console on launch day. You might have waited for weeks or months before having the “privilege” to queue outside a Toys “R” Us to get a Sega Genesis; you may have taken the day off to wait for a Wii U to get delivered (I speak from experience). Whatever you did, these moments stick with you for a lifetime.

On May 11, 1995, the day of the Sega Saturn’s North American launch, such exciting scenes did not exist. In what may have been the most damaging console launch in the history of gaming, a well-meaning surprise from Sega of America was completely undone by poor planning, terrible execution, and plucky, cut-throat competition.

On this day, 25 years ago, Sega of America president Tom Kalinske took to the stage at the first-ever E3 inside the LA Convention Center and left attendees slack-jawed following his huge announcement: the Sega Saturn was, from that moment, on sale across the U.S. It was a power play to gain the upper hand in an intense rivalry that started in late 1994, when Japan witnessed the Saturn going toe-to-toe with the all-new Sony PlayStation.

Sega released the Saturn in the Far East on November 22, 1994, a fortnight before Sony dropped its first-ever console on December 3. Both performed remarkably well; Sega managed to shift half a million Saturns in a month. The PlayStation sold 100,000 units in just the first day, but had poorer 30-day performance. Yet with more forward-thinking hardware and an increasing number of third-party developers on its books, Sony was gaining traction–and scaring Sega.

And so Sega took a gamble: push gamers to buy its console early, effectively stopping this captive audience from investing in another one from Sony–at $700 in today’s money–a few months later.

And so, proud as punch, Kalinske stepped on that fateful stage and told delegates at E3 that the Sega Saturn was now available in stores across the U.S. for $399. Yes, it was pricey, but this was a whole new frontier. It also had one of the weirdest ad campaigns of all time.

Before even considering the competition it would face from Sony, Sega’s surprise American launch had a raft of logistical problems:

  • Aside from a small number of official launch partners–who had meager supplies of the console–production shortages meant some stores simply didn’t get any. KB Toys, which Sega didn’t provide day-one Saturns to, was so offended by the move that it never sold new Sega consoles again.
  • Game developers weren’t ready. Just four games came out on release day (arcade ports of Daytona USA and Virtua Fighter, plus Panzer Dragoon and Clockwork Knight). The catalog would remain bare-bones for months.
  • Crucially, this was 1995: E3 wasn’t broadcast nationally, or live. The internet wasn’t really a thing. Magazines were largely released on a monthly basis. The surprise wasn’t really captured by the press. And, as evidenced above, the TV ad campaign sucked.

Then, the competition dropped the elbow. Followed by a Stone Cold Stunner. And a Swanton Bomb. That same day, Steve RaceSony’s head of developmenttook to the stage. He didn’t take the wind out of Sega’s sails; he set fire to its entire ship and watched it sink hard and fast, presumably from Venice Beach. 

His announcement was simple, and just three words: “Two ninety nine.”

He didnt drop the mic–I’m not sure that was a thing back then–but luckily, he didnt have to. Damage done. Race won the battle; Sony would soon win the wider war.

The PlayStation, which dropped in North America on September 9, 1995, was a full $100 cheaper than the Saturn. Sure, there was a wait, but Sony was releasing the console alongside Ridge Racer, NBA Jam: Tournament Edition, Rayman and Battle Arena Toshinden; Jumping Flash, Wipeout, Mortal Kombat 3, and Twisted Metal soon followed. Tekken would make waves, but not as much as the immortal Tekken 2, which had already been secured as a console exclusive.

The rest is history. Despite a genuinely brilliant final line-up, the Saturn–a console dear to my heart–only sold three million units in the U.S., while the PlayStation sold 40 million. Even the Nintendo 64, which arrived a full year later, shifted 20 million units.

Happy 25th birthday, Sega Saturn. You and your team had the best intentions, you were a genuinely unique and brilliant console, but you had the very worst start in life.

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