Sega experienced a meteoric rise in the 90s, reaching over 50% market share, but by the early 2000s, they had abandoned the hardware business and became a software company. The video identifies three key mistakes that led to Sega's downfall:
1. **The 32x add-on**: Sega of Japan's decision to create a 32-bit add-on for the Genesis, despite Sega of America's reservations. The add-on was rushed, had a poor game library, and was eventually forgotten in favor of the Sega Saturn.
2. **Rejecting Sony's partnership**: Sega's rejection of Sony's proposal to partner on a CD-based console, which led to Sony developing the PlayStation independently. This decision is considered one of the biggest mistakes in business history.
3. **The surprise launch of the Sega Saturn**: Sega of Japan's decision to launch the Saturn four months ahead of schedule, which resulted in a rushed and poorly executed launch. The console had limited supply, a hefty price tag, and a lack of third-party games, ultimately leading to its failure.
These mistakes, particularly the surprise launch of the Saturn, had a lasting impact on Sega's success and ultimately led to their exit from the hardware business.
Here are the key facts extracted from the text:
1. Sega's market share rose from 10% to over 50% in the early 1990s.
2. By the early 2000s, Sega had abandoned the hardware business and became a software company.
3. Sega of Japan and Sega of America had disagreements that led to missteps and missed opportunities.
4. Atari released the 64-bit Jaguar console in 1993, which prompted Sega to consider releasing a new console.
5. Sega of Japan pitched the idea of a 32-bit Genesis add-on to Sega of America in January 1994.
6. The 32x add-on was released on November 21, 1994, and debuted at around $160.
7. The 32x had a limited library of games, with only three titles available at launch.
8. The 32x was not compatible with all Genesis games.
9. Sega of Japan was developing the Sega Saturn console while the 32x was being created.
10. Sony and Nintendo had a partnership to develop a CD add-on for the Super Nintendo, but Nintendo eventually partnered with Philips instead.
11. Sony pitched their console idea to Sega, but Sega of Japan rejected it.
12. Sega of Japan turned down the opportunity to partner with Sony on a console.
13. Sony released the PlayStation in 1994, which went on to sell over 100 million units.
14. Sega launched the Saturn in Japan on November 22, 1994, and sold 500,000 units in the first month.
15. The North American launch of the Saturn was set for September 1995, but was moved up to May 1995.
16. The Saturn was launched at $399, with a limited supply and a small library of games.
17. Sony's PlayStation launched in September 1995 and sold 100,000 units in two days.
18. The PlayStation was $100 cheaper than the Saturn and had a better variety of launch titles.
19. Tom Kalinske resigned from Sega of America in 1997.
20. The Saturn was discontinued in 1998, and Sega of Japan president Hayao Nakayama left the company.
21. Sega released the Dreamcast console in 1999, but it was also discontinued in 2001.
22. Sega announced that it would no longer produce hardware in 2001.