We're right in the middle of the twentieth anniversary of the start 16-bit console era, meaning that we've been observing a lot of momentous gaming history lately. This time around it's the TurboGrafx-16's turn to take the spotlight as 1UP takes a look back at the console's development history, rise and fall in the market, and why the system sputtered to a stop in the end.
Flash back to 1987 for a moment. Nintendo has an iron grip on the game console marketplace in Japan and America, although it wouldn't achieve behemoth status in the US for another year or so. The NES (Famicom in Japan) was king, and Nintendo took full advantage of that position to browbeat its third parties senseless, limiting the number of games they could release per year and even forcing them to sign contracts that forbade them from developing for rival platforms. It was very much the same sort of place that Wal-Mart enjoys today in general retail: If you, a fledgling game developer, wanted to release a NES game, you had to play by Nintendo's all-controlling rules, or you could take a hike.
One company saw an opportunity in this...or, actually, two. Hudson Soft, a large Japanese software company based on the northern island of Hokkaido, launched a top-secret internal project in 1985 to design a possible successor to the Famicom in Japan. Hudson's largely known here for their bippy platformers (and, more recently, their mobile and iPhone game publishing), but they were also a computer development powerhouse in the 1980s, creating the operating systems for several Japanese computers and coding the software that drove the NES's Japan-only keyboard attachment.
You've probably heard most of this story before, but there are some interesting bits in there that I didn't know. For instance, the management behind the TG-16 were so out of touch with the wants and needs of their customers that they actually passed on the chance to lock Mortal Kombat up as a TurboGrafx exclusive. As far as boneheaded management decisions go, that's right up there with Sega's management forgetting that they owned the Streets of Rage license or Atari's misguided belief that people would buy extra copies of Pac-Man for the Atari 2600 so that they could keep a spare copy at their ski houses. It seems to me that the best way to bring down a company is to maintain a sizable disconnect between management and customers.