by Goran Damnjanovic, Gaming Columnist
Published in Gaming on 30th June, 2018
Today, we live in a world of oligopoly, at least when it comes to video game consoles (but, come to think about it, most products and services are controlled by a few big name providers and manufacturers). Microsoft, Sony, and Nintendo are the three big-name companies that provide us, the gamers, with boxes that are our primary source of digital entertainment. Even on PC, an open platform that should offer unlimited freedom when it comes to hardware and software we also are confined to just a couple of big-name providers.
Microsoft for the back-end software; Nvidia, Intel, and AMD when it comes to the most important hardware, and Steam, GOG, and Microsoft again (with its Microsoft Store) when it comes to video games. And while it may look like that we had more choices a couple of decades ago, that really isn't the case. Video game console business was always pretty expensive endeavor and at each point in time, there were just a couple of companies offering full-fledged video game consoles. Over the years some survived, some faded into history, and some stayed alive, in some form or another.
The gaming industry is filled with different consoles that came and went, some becoming cult classics and best sellers and other leaving the market way sooner than expected. Those failures carried important lessons with them. Lessons their creators learned and stayed alive and kicking, or lessons that weren't absorbed or were too tough to be learned upon, leaving many manufacturers in the dust, their corpses left to rot in the graveyard of video game industry. Today we will revisit the biggest video game console failures, will see what were the reasons for their demise along with lessons of failure they carried with them. Let us begin.
The PlayStation Vita isn't really a flop, but on the other hand, it certainly is. If we look just at Japanese market the Vita is doing pretty good. There are lots of titles for the console and it still gets its fair share of new games, even today. But, looking globally, the PlayStation Vita flopped, there's no doubt about it.
Released in 2011 in Japan and in 2012 in the rest of the world, this handheld console was to replace the PSP, one of the most successful portable consoles of all times, on of rare devices that managed to disrupt Nintendo and their handheld gaming domination. It featured top of the line specs along with lots of quality titles available at or shortly after its release but something went wrong along the way and the console's sales started to decline pretty soon after its release, except in its home market (Japan). At the end the console sold in between 10 and 15 million units, which would be a solid result on its own. But its predecessor was hugely popular, selling more than 80 million units.
In the end, the fall of the Vita made Sony clear that the company won't create another handheld, leaving handheld console market to Nintendo and mobile devices. As for why it failed well, there are many reasons. Firstly, we saw the rise of mobile gaming and while today it is dominated by freemium titles most of which aren't games that would be released on a proper handheld console back when the Vita came many though mobiles are the future of portable gaming, skipping on getting the Vita. Further, Sony decided to slap a price that was too high for many fans, especially if we combine its price with relatively pricey games for the console. Next, Sony didn't have a clear strategy for the portable device. It was promoted more as a PS3 companion device, capable of streaming PS3 games over home Wi-Fi than a standalone portable console. And finally, Sony stopped offering quality first party games few years after the release while at the same time showing no care about third-party titles, especially indie games that are the major part of the recent success of the Nintendo Switch. In the end, the PS Vita had lots of potential but Sony somehow managed to turn it into one of the biggest flops in history.
Do you remember Ouya, the video game console that promised a revolution in gaming? It appeared back in 2013 when Kickstarted was at its peak popularity. This made its Kickstarter campaign a huge success, thus quickly becoming available for everyone to buy. But soon after the full release, Ouya started to face multiple issues. Its controller was deemed as a piece of low-quality gaming peripheral that failed in comparison to those offered by Sony, Microsoft and other big name brands such as Razer or Logitech. Its hardware was solid when the console appeared but since the console ran on Android, which was pretty optimized for gaming and large TV screens back in the day, most games ran poorly on the console.
And also, the games library was poor at best. The days when everyone thought that mobile gaming will bear fruit to many quality games were gone and Ouya owners didn't have lots of games to play. The creators of the console tried to jumpstart Ouya games development but that failed after a while. It was simple; gamers viewed Ouya as a cheap alternative to popular home consoles or as a way to play mobile games on a TV screen and didn't want to pay high prices for games, leading to developers massively abandoning the console. Its $99 price was pretty affordable but without quality games, the console was en route to total failure.
After just two years Ouya stopped selling and the company was sold to Razer in 2015. Poor hardware, lackluster games library, awful positioning (who would want to buy games for a console that's just a modified Android device?), and a couple of other reasons made Ouya a huge flop.
Nintendo released the Switch more than a year ago and the console still sells like hotcakes. It is near 20 million units sold, a figure that will be passed before the end of Summer. As we noted in our article on handheld consoles, Nintendo made a perfect device for those who play at home but also want full game experience while outside. And few know that Sega did something similar back in the nineties with the Sega Nomad.
The Nomad was a glimpse of the future. The console was a portable version of a hugely successful Sega Genesis (Sega Mega Drive for us from Europe), being capable of playing full Genesis games. It had a slot for full-sized Mega Drive cartridges meaning you could play all those games on the go! It was a huge technical achievement since even today we cannot play full console games (if we don't count the Nintendo Switch, or all those emulators available for Android devices) in a portable form.
But, even today Nintendo had to make many cuts in order to allow gamers to play their favorite titles (did somebody said Skyrim?!) while commuting or chilling at a park. Back in 1995 when the Nomad launched, Sega also had to make many cuts in order to allow for the console to work properly. Firstly, it was really bulky and heavy, with a subpar display that wasn't capable of showing games in all their glory. Next, we were light years away from big rechargeable batteries we have today. In order to run the Nomad you had to stuff it with six AA batteries and even then the console would work just two hours before asking for a new, expensive, meal. And finally, 1995 was the year when Sega Genesis was at the end of its lifecycle and gamers slowly started moving on to new machines. They didn't want to pay a premium price for a device capable of running games they already played to death.
Nevertheless, Sega achieved a huge feat with the Nomad. It was the first proper 16-bit handheld console, it was capable of running full Sega Genesis games - imagine if Sony or Microsoft released portable versions of the PS4 or Xbox One? They would sell like crazy, even today when we are waiting for the two to announce the new generation of consoles - and it was capable of running games on a TV, along with the support for an additional controller. Its main fault was in its poor timing of the release. It's simple, the world (and battery technology) just wasn't ready for a machine that was cool as the Nomad.
When it comes to handled consoles there were lots of failures, and one of the biggest was Gizmondo. The console had a massive marketing campaign that could freely be characterized as megalomaniacal. Millions of dollars were spent on organizing celebrity parties, promoting the console on TV, and even participating in 24 Hours of Le Mans race as a part of the promotion strategy. The console featured powerful internals for the time (it launched in 2005) and was aimed to compete with the PSP and the Nintendo DS. It was promoted as a full-fledged portable entertainment system capable of playing movies, music, and supporting SMS and GPS. A dream device in theory. But it failed miserably.
Firstly, a widescreen version of it was announced shortly before the launch of the original version that promised better resolution, TV out, a GPS, and smartphone capabilities affecting the sales in a negative (duh!) way. Next, the company owners were involved with mafia activities in Sweden, spurring huge controversy. And finally, the console sported a release price of $400, which would be too much even today when we are living in an era of $1000 smartphones. And finally, the games library was extremely poor, with less than ten games released in total. The console also had a horrific build quality, with its rubberized plastic that constituted the body melting and deteriorating over time.
Finally, the company behind Gizmondo (Tiger Telematics) managed to amass $300 million in debts, and the console sold in less than 25,000 units. Its best-selling game was dubbed Sticky Balls. Talk about poor marketing. A huge flop by any account.
Apple is not a company that showed noticeable interest in video games. A recent Facebook post by John Carmack (the guy behind id Sofware and Doom) showed that Steve Jobs didn't want for Apple devices to be characterized as devices suited for gamers. But even Apple couldn't look past the success of the Sony PlayStation and decided to develop a video game console of their own. But back then, Apple intended to make the Pippin (what a name!) an open source standard, similar to what Android is today, only in hardware form. Basically, the Pippin was a gaming form of its Macintosh platform.
Apple developed the hardware and then signed a deal with Bandai, which were responsible for providing casing, packaging, and controller design. The console was launched in Japan in 1995 and in the US in 1996 but the high price and lack of games (the console sported a $599 price tag) were the reasons for its massive failure. The console managed to sell in Japan, but in 1997 Steve returned to Apple and shut down the Pippin project in a heartbeat. After all, Apple is what it is today thanks to its closed software ecosystem and the Pippin was the exact opposite.
Although the system was a huge flop it did bring some cool new stuff to the world of home consoles. Firstly, it offered a proper wireless controller, which was a massive feat to accomplish in 1996. And also, the Pippin console came with internet access, a feature not offered by other large players in the industry that soon after (once Microsoft released the original Xbox) became one of the basic features every video game console had to come with.
Nintendo had some truly marvelous gaming devices, but the company also produced a couple of massive failures. The biggest one was probably the Virtual Boy. If you think that virtual reality is a novelty tech that surfaced with Oculus Rift and HTC Vive you probably weren't here during the eighties and nineties, when both VR and 3D came and went a couple of times, each time failing miserably.
And back in 1995 VR was hot news, ready to take the world. Nintendo promised a complete revolution in gaming, a device capable of offering complete immersion, and experience capable of transferring people to new worlds, worlds built by the biggest video games company of all times. But once the console released to the public, the public quickly discovered that Virtual Boy was way ahead of its time, in a completely negative way.
The console offered monochrome dual displays that didn't offer immersive VR experience. Instead, they offered nausea and their red image was extremely unpleasant to look at. Also, the 3D effect of the console was not impressive and it offered very poor image quality. Further, Virtual Boy was pretty expensive and its mounting mechanisms was everything but easy to set up and very discomfort to wear. And finally, the lack of quality titles was the final nail in the coffin. Virtual Boy managed to sell about 750,000 units and the console disappeared from stores just one year after its release.
Yes, Virtual Bot offered a completely new gaming experience but it came at a price, a price that was too high for many. The console was ahead of its time but unlike the Sega Nomad, the Virtual Boy was more of a proof of concept than a real, usable product.
Okay, the Atari Lynx is the third handheld console on this list, just further proving that creating a capable and popular portable gaming console is way harder than it looks. Back in 1989 Atari was, along with Nintendo and Sega, one of the biggest players in video games industry. The company sold the Atari ST, a personal computer that featured an exemplary library of quality games and Atari wanted to create something new. The decision was to go with a handheld console and the Atari Lynx was born.
The system launched in 1989, just a few months after Nintendo Launched the Game Boy and it seemed that Atari had a massive hit in their hands. The Lynx offered beefy hardware along with a color screen, something that its biggest rival could only dream about. Its price was also just right, and the release date was perfect for the console to become best seller during 1989 holiday season. But, Atari made some wrong turns, and those mistakes were very similar to the ones Sony made when promoting the Vita.
Firstly, the company messed up the production offering a poor number of units, way lower than demand. This resulted with kids who wanted to own it getting a Game Boy instead (the Lynx looked better and was way more powerful than the Game Boy at the time). Then, Atari relied on its brand recognition and decided to not spend lots of money on marketing, resulting in Nintendo getting even more popular with kids, the primary part of the market for video game consoles back then. And finally, Atari was lazy when it comes to releasing quality games. The Lynx's game library was much poorer than Game Boy's even though Atari's console offered better specs and allowed developers to create better-looking games. And finally, in 1991 Sega released its Game Gear portable console that also offered beefy specs and a color display, but it also came with a much richer game library. All this resulted in relatively poor reception even though critics praised the Lynx, noting that it dominated over Game Boy when it comes to hardware and features. But again, the quality of its games library was a deciding factor for its failure.
The Nintendo Wii U was a successor to the third highest-selling home console of all times, the Wii. The Wii sold in more than 100 million units and it seems that Nintendo thought their next offering will sell well by default. It didn't. When it came out, the Wii U had more than one major problem. The first issue was its naming scheme. Since the Wii catered to casual gamers who didn't care much about technical specifications, they thought the Wii U was a simple upgrade of the Wii and didn't bother to get it. The Wii U also lacked in processing power compared to the PS4 and the Xbox One, making lots of third-party publishers to simply avoid the console because porting games would be too expensive, complex, and time-consuming.
Next, the Wii U's tablet controller was a bit too chunky and a bit too clunky to be used comfortably. Its built-in display was capable of running Wii U games, but only if you were in the wireless range of the console, so that was a subpar feature that didn't resonate well with consumers. And finally, the system lacked in games. While the Wii offered strong first-party titles right at launch, Nintendo offered just Mario games when Wii U launched, and the first Zelda game for the Wii U (Breath of the Wild) arrived after the console's discontinuation.
All this led to very poor sales numbers, at least for a console made by Nintendo. Yes, the Wii U sold in about 13 million units but for a successor of the Wii that was just unacceptable. If Nintendo didn't have lots of money lying around and a successful portable console (and a revolutionary product in the form of the Switch), the company could've ended its existence because a failure of Wii U's magnitude usually means the end, as seen in the final two spots on our list.
The second biggest console failure of all times is called the Atari Jaguar, and this one made Atari exit the hardware business and focus just on software. In other words, Atari Jaguar killed one of the big name companies in the video game console world. The system debuted in 1993 and it was marketed as the ultimate console in terms of power; it sported 32-bit CPU and GPU along with 64-bit "graphical acceleration" system in a world dominated by 16-bit systems. But the console sold in just one-quarter of a million units.
The main reason for its failure was Jaguar's extremely poor games library. Yes, the system was noticeably more powerful than Sega Genesis and even the PlayStation. But the Jaguar shipped with a flaw in its memory controller, making games development extremely complex. Developers just couldn't work with the console since it demanded more time and money so most of the multiplatform games skipped the Jaguar.
And since Atari didn't have resources to spend on marketing the console couldn't reach sales numbers that would guarantee profit for developers who decided to make games for the Jaguar. And the console also featured poor industrial design with a controller that could freely be described as one of the worst controllers in the history of gaming. Add to that the failure that the Atari Lynx was and you get a quick ticket out of the console market. Atari finally decided to pull the plug on the Jaguar in 1996, leaving the console market with just three major players.
Oh, the Dreamcast. A huge flop that wasn't really a flop. Look, Sega Dreamcast was an excellent piece of hardware, a proper life belt for the problems Sega got themselves into after the company suffered huge losses with the Sega Saturn, another big flop that isn't mentioned on this list. The Dreamcast had it all; a powerful insides, excellent and inventive controller, quality games that launched along with the console (like Shenmue, Crazy Taxi, House of the Dead, Jet Set Radio, Ikaruga, Sonic Adventure, etc.), and solid sales numbers. But even all this, an almost perfect launch situation, wasn't enough for the console to become profitable.
But, Sony decided to incorporate dirty promotion tactics in order to hurt Sega's sales. The company started to advertise its upcoming console (the PlayStation 2) as the most powerful console ever to be created, powerful as supercomputers of the time. This made fans top wait for the PS2 and skip on getting the Dreamcast. Further, even though the console saw a solid success in Western markets, its sales in Japan were underwhelming, disallowing it to become profitable. And finally, Microsoft and their huge promotional budget decided to enter the scene and Nintendo promoted the upcoming Game Cube as even better than the PS2. Sega was also left in debts because the Saturn was a huge failure. And the Saturn being such a failure grew consumers wary of Sega's new console, even though critics adored it.
All this lead Dreamcast to fail to become profitable. Sales numbers were solid (the console sold around 9 million units in less than three years) but the console didn't manage to create high enough profit margin. Sega had to lay off a third of its workforce and the company pulled the plug on the Dreamcast in March, 2001. Dreamcast was the first major console to offer Internet connection and online play, its controller was revolutionary, and games were excellent. But the company didn't have the money to put into promotion and hardware losses and to wait for the console to become profitable. It is a shame because Dreamcast was, by many, the best sixth-generation console and if sales continued at the same pace and if Sega didn't discontinue the console it would probably become one of the best-selling consoles of all times. Fortunately, Sega is alive and the company still makes cool games. It's a shame they cannot create games for their own hardware though.