Eventually, Sega released the Sega Saturn. The Saturn was supposed to be the system that would give Sega the upper hand in the industry. Although the Saturn had 32-bits and CD-ROM quality, Sega only sold around 10 million units worldwide. This fell short of the companies goals. Moreover, it cost Sega an estimated $700 million in losses.
Sega executives were forced to rethink a new strategy and figure out something fast. Ultimately, they designed a new system called “Sega Katana” (which means long sword in Japanese). Eventually, the name Katana was dropped and was renamed Sega Dreamcast.
In November of 1998, the Sega Dreamcast officially came out in Japan. The system was smaller in size compared to other systems that Sega manufactured in the past. Sega executives built the Dreamcast with new innovative components that many of its competitors lacked. For example, the system had a 56k modem built inside. This was considered state-of-the-art in 1998, especially when only commercial and home PCs had an internet connection. The system used hardware and software from companies such as Microsoft, Hitachi, and NEC. The Dreamcast offered 128-bit graphics, CD quality sound, and a wide selection of games.
Another interesting feature that the Dreamcast offered were motion controllers, which no other system had at the time. The controllers were designed to hold a memory card, which can easily store saved games and other information. In addition, the system came with the option of having up to four players plug directly into the console for games that had multiplayer.
Just like the Genesis, the Dreamcast had several accessories that the consumer could buy. There was a mouse, keyboard, hard drive, microphone, arcade stick, and digital camera which could all have been purchased. Sega designers wanted to expand the accessory line and add an MP3 player, DVD player and a Zip Drive, but these ideas were later scrapped.
At first, the console broke a record of having more than 200,000 per-orders before coming on the market. This eventually broke Sony Playstation's record. Dreamcast was seen as the system that was going to redeem Sega for their past failures. The only problem was that Sony had a trick up it's sleeve. In March of 2000, Sony released the long-awaited Playstation 2. Instantly, it became a success and Sega executives became anxious rather quickly. The Dreamcast tried to compete with the PlayStation 2, but sales began to take a hit.
In 2001, Sega officially decided that the system would be discontinued. Shockingly, the consoles were still sold in Japan up until 2007, due to the popularity there. Although the system had such a short life span, it received mainly positive reviews. BusinessWeek said that the Dreamcast was “ The best product of 1999” and in 2001, Electronic Gaming Monthly gave the console a “9.2 out of 10”.
Even though the Dreamcast was a sixth generation game console, many of it's components and characteristics can still be seen on other consoles today. According to some, the Xbox console was inspired from the Sega Dreamcast. Online game play was also one of the key features that Dreamcast started. In the end, the Dreamcast cost Sega almost $500 million in losses. On paper, the Dreamcast will go down as a loser from a business perspective. Fortunately, from a gamers perspective, the Dreamcast may very well be the greatest console of all time!