For every monumental video game hardware success such as the Nintendo Entertainment System or the Atari 2600, there are missteps like the Nintendo Virtual Boy and the Atari Lynx. Every video game producer makes a mistake sooner or later, but what matters is the ability to bounce back from miscalculations and return to glory. Where some companies stumble and find a way back to success, many do not. 1UP.com has a pair of interesting articles that look back at failed hardware, examine why they failed, and suggests ways that flailing consoles could have come back from the brink. All of your favorite dead consoles are included including the Virtual Boy, TurboGrafx-16, Sega Saturn, Atari Lynx, Neo Geo Pocket Color, and the lamented Sega Dreamcast.
In the tumultuous system wars of the 1990s, Sega often proved its own worst enemy. Tom Kalinske, the Sega of America CEO credited with the company's smash-hit Genesis campaign, would later recall that Sega's Japanese offices disliked the American branch for their success. Sega of Japan CEO Hayao Nakayama had let Kalinske run Sega's show in North America, and the Genesis was a bigger hit there than it ever would be in Japan.
Whether it was jealousy or not, the two sides of Sega didn't get along nearly as well as they should have. They were effectively competing against each other by 1994, when the Sega Saturn and the 32X warred for the attention of Sega supporters. It later led to Kalinske's departure, with former Sony executive vice president Bernie Stolar taking his position.
Stolar was forced out of the company on the eve of the Dreamcast's launch, along with several other high-level Sega of America employees. Nakayama didn't survive the year either. He was succeeded by Isao Okawa of CSK Holdings Corporation, which had acquired Sega in 1984, and Okawa's vision for the company didn't include the Dreamcast. "I don't believe he was committed to the hardware," Stolar told Bitmob. "He just believed it should be a software company."
While it's fun to wonder what would have happened if dying hardware had survived in the market, sometimes good things have to come to an end in order for better things to happen. Sega's exit from the hardware business enabled the company to bring its popular characters to gamers who had a minor interest in Sega, but would rather own a Nintendo, Sony, or Microsoft product. The Neo Geo Pocket Color's withdraw from stores led to the rise of SNK Playmore which today cranks out new home console titles featuring popular SNK properties. Nintendo gained valuable data and experience in the world of 3D gaming thanks to the Virtual Boy, and the company's in-house experiments in the years following would eventually lead to the Nintendo 3DS. And, finally, without the Atari Lynx, I wouldn't have had a fourth thing to mention to close out this paragraph.