Opinion: Birth of the 16-Bit Console War
Looking back, there are many factors that determine the success or failure of a console but ultimately it comes down to three things. The first is the right price point. The second is compelling software. Lastly, timing is everything.
Despite a rough start, Sega was poised to make a comeback leveraging the 16-Bit Motolora 68000 processing chip included in its hardware. In 1989, Sega of America launched the Genesis, priced at $189 and packed in with Altered Beast. This was the game to showcase the 16-bit processor. However, as we know today technology alone does not drive success. Michael Katz, CEO of Sega of America realized that software was king and started the infamous marketing campaign, “Genesis does what Nintendon’t.” Tied with the creation of sports games contracting celebrities and hit games like Vectorman and 8-bit classics like Golden Axe, Columns and Sonic the Hedgehog, Sega quickly made a triumphant comeback against console giant Nintendo.
1989 was also the year Japanese computer manufacturer NEC launched the TurboGrafx-16 retailing at $199. Right out the gate, the machine had a competitive edge against the Sega Genesis. It was familiar and available during a time that PC Engines were popular. However, it had one distinct disadvantage. Sega had already made a name for itself among gamers. TurboGrafx stored its games on plastic cards and later on CD with the advent of CD-ROM technology. This separation of products led to consumer confusion, a mistake Sega would make in later years.
Shortly after the release of the Genesis and TurboGrafx-16, Nintendo’s lack of technological prowess had no bearing on the console’s performance. Despite two giants coming to their doorstep, Nintendo remained unmoved. They already had a massive install base and continuously growing library of games. They had even signed licensing deals with Konami and Acclaim to bring smash hits like Metal Gear to the platform. Super Mario Bros. 3 went on to be the best selling game not included with the console hardware.
Come 1991, Nintendo released the Super Nintendo at $200. By this time Sega had already proven that they remained a contender. With a lower price point and a one year head start, many consumers had decided to go the route of the Genesis. The war had officially began.
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