Original subtitles

(foreboding music)

- A Japanese toy and amusement company

is looking to break into

the American arcade video game market.

- The original idea was to create a game based on Popeye.

Popeye was huge at the time.

- You get this very jaunty sailor

always trying to save Olive Oyl from this large brute,

except for he can’t use that because of copyright.

- The Popeye license doesn’t come through

and a guy named Shigeru Miyamoto has to, on the fly,

change the game to make it into

something a little bit more generic.

- He cleverly takes Bluto from Popeye

and turns him into a giant gorilla.

- A King Kong-esque character,

stealing a girl and throwing barrels, Donkey Kong.

- [Narrator] And the character he creates

to face Donkey Kong

will eventually turn this obscure company

into one of the most lucrative brands on earth.

- He takes Popeye himself and turns him into

Jumpman.

Why, what did you guys think I was gonna say?

(dramatic music)

- [Narrator] Within two years, Jumpman will get a new name.

- Mario.

- And earn $22 billion in sales.

- Nintendo just took over. It was everywhere.

- [Narrator] But a second player will enter the fray.

- Sega’s gonna be the bad boy.

- Let’s take Nintendo down.

- [Narrator] Leading to iconic innovations.

- We need our Mario.

- [Narrator] Missteps.

- It was the dumbest move in the history of business.

- [Narrator] And the rise of a dark horse rival.

- How’d you like to come make games for Sony?

(dramatic music)

- [Narrator] In a war to save the video game industry.

- This is crazy. This is such a brutal betrayal.

- Ice cold, man.

(dramatic music)

- [Narrator] And establish which console will rule them all.

(dramatic music) (video games beeping)

- In the early ’80s,

they used to say there were four networks,

ABC, NBC, CBS, and Atari.

There were so many consoles in so many houses in America

that everybody was playing it.

- [Narrator] Atari’s runaway success

even entices toy companies Mattel and Coleco

to get into the console business.

- Things look great. The market is huge.

In fact, in ’82, the projections for ’83 was that

it was still gonna grow some more.

- So a lot of people started to develop games for the Atari,

and if the cover had fancy art, you’re gonna buy it.

- "E.T." is a good example of

how crazy the video game industry got.

Warner Brothers wants to make "E.T." into video game

in only five weeks.

As you can imagine,

any game built in five weeks is not very good.

- It was a glut of games on the market.

You even began seeing Purina,

like as in the cat food brand, making games.

Quaker, as in the oat company,

they started making games.

- [Narrator] Consumers stop buying video games

and retailers start slashing prices.

- And then ’83 happened and it was the apocalypse.

- Atari had made so many games that weren’t selling

that they actually dug a ditch in Alamogordo, New Mexico

and dumped them all in.

- Before the video game market crash,

the video game industry was worth about $3.2 billion.

It was now a hundred million,

so that’s a massive contraction,

an almost 97% decline in the industry.

- [Narrator] But, at the same time

the US console market is imploding,

a company in Japan goes all in.

- In Japan, in 1983, Nintendo releases the Famicom,

which is short for the Family Computer.

- [Narrator] In the last two years,

"Donkey Kong" has become an arcade sensation,

earning $280 million, one quarter at a time,

and introducing gamers to the name Nintendo.

- A lot of people think that Nintendo is like

a 30 or 40-year-old company.

It really dates back to 1889.

They started by doing playing cards.

- That’s what they did until the end of World War II,

when a young man named Hiroshi Yamauchi

took over the family company

and he needed to find a way

for the company to prosper and survive,

and he tried absolutely anything.

- [Narrator] Now, with the release of the Famicom system,

the former playing card executive

sets his sights higher.

- It became a huge hit in Japan,

but success for Yamauchi at that point

didn’t mean success in Japan.

It meant complete dominance,

the way that Disney dominates children’s entertainment.

- [Narrator] Nintendo sees opportunity

in the devastated American home console market

if they can just figure out

how to distance the Famicom from Atari.

Tasked with figuring it out is

the head of Nintendo’s new US office, Minoru Arakawa.

- Minoru Arakawa is a brilliant guy.

He also happens to be

the son-in-law of the president of Nintendo in Japan.

- Arakawa actually went to school at MIT.

He understands the West.

More importantly, he understands

what consumers want in North America.

- He knows that they can’t send Famicom to the US

when video games has become like this bad word.

No one’s gonna buy it. No one’s gonna look at it.

No one’s gonna put it on their shelf.

So they have to really rethink everything.

- We need to convince Americans

that this is something different, something new.

Something

more like this.

(dramatic music)

- Nintendo figures they’re gonna go with

something Americans know best, their VCR.

While the Japanese console loaded from the top,

the US version loads from the front, just like a VCR.

- And they called it the Nintendo Entertainment System.

Not video game system, but entertainment system.

- [Narrator] Next, Arakawa imagines

what an entertainment system should look like.

- It was this sprawling thing that had a laser gun.

It had tops and gears and controllers and a robot.

Yep, a robot called R.O.B., Robotic Operating Buddy.

(upbeat music)

- R.O.B. the Robot was essentially a robot

that played video games with you.

It had the ability to

pick up little discs and move it around.

- He’s helping you play a video game called "Gyromite."

Put yourself in the perspective of

a kid wanting video games in the 1980s.

This was an America that was coming off of watching

Luke Skywalker working with R2-D2.

It’s everything we wanted.

- [Narrator] Arakawa’s plan hinges on convincing America

that the NES isn’t a video game console.

It’s a toy.

- They needed the Trojan horse,

and they went with R.O.B. the Robot.

- [Narrator] But it’s not enough for electronics retailers.

- Sears passes on it. Circuit City passes on it.

Of course, they had been burned by video games.

Why would they jump back into it?

But Toys "R" Us sees a robot, sees a toy gun,

and they go, "This is a toy.

We’ll give it a shot."

- Toys "R" Us even advertises the NES

as a video robot system,

so they were really leading with robot.

- And people bought it initially,

but, once they started playing with it,

they realized it just wasn’t very fun.

R.O.B. the Robot looks really cool on TV,

but, when you played it, it was really slow.

It barely moved.

(R.O.B. whirring) (upbeat video game music)

- [Narrator] Nintendo sells only 50,000 sets in 1985,

barely half of what it manufactured.

- Here’s the thing.

R.O.B.’s main purpose was not to play "Gyromite."

It was to get Nintendo onto American shelves

and into the hands of American consumers.

For that purpose, R.O.B. was an absolute success.

- [Narrator] Now, Arakawa wants to show America

what the NES can really do.

(dramatic music)

- What Nintendo needs is really a killer app.

- [Narrator] Arakawa and Nintendo

executive Howard Lincoln

look for a new game to bundle with the NES

that will hook players right out of the box.

- What about "Excitebike"?

- No.

- Howard Lincoln was not a video game guy.

Lincoln started off as Nintendo’s lawyer.

Nintendo was being sued by Universal

over King Kong and Donkey Kong being too similar.

(dramatic music)

- No.

- Not only did he get Nintendo off the hook,

he made it so Universal had to pay Nintendo for damages.

(dramatic music)

- You no not want to be

in the same industry as Howard Lincoln,

because he’s not going to be nice.

He is going to smile and shake your hand and say,

"I’m going to destroy you."

(dramatic music)

- Everybody loves baseball.

Mario.

- Super Mario.

(exciting music)

- [Narrator] Since starring in "Donkey Kong,"

Jumpman has earned a proper name.

- The name Mario comes from the landlord of a warehouse

that Nintendo had many of their products at,

and the landlord was named Mario Segale.

- The character gets his own spinoff, "Mario Brothers,"

which introduces Luigi.

Then that gets a spinoff called "Super Mario Brothers,"

which is astoundingly good.

- Super Mario Brothers really opens players

to a completely new world.

You’re on this adventure,

finding hidden objects, moving through pipes.

- So, if you’re looking for a game to package with the NES,

it needs to be something that

encapsulates this feeling of childlike joy and of play,

and "Super Mario Brothers" does this.

- And, without realizing it,

what Nintendo did was copy the Disney playbook.

They have made their Mickey Mouse.

- [Narrator] "Super Mario Brothers,"

packed in with the NES, is released in the summer of 1986.

- City by city, over the next year,

it rolls out into more and more markets,

and, by Christmas time, 1986,

there are Nintendo Entertainment Systems

in every toy store in the country.

- What was proven is that Atari’s

downfall didn’t mean that

Americans were not interested in video games.

They just wanted high-quality experiences.

- [Narrator] Arakawa’s gambit has rekindled demand

in the American video game market,

making this the perfect moment for a rival to swoop in.

(dramatic music)

- Sega started in Hawaii,

servicing US military bases and slot machines.

Sega is Service Games.

S-E-G-A, Sega.

- They went from slot machines

and juke boxes back in the ’50s and the ’60s

to then video games.

- [Narrator] Now, under President Hayao Nakayama,

Sega has been developing a home console of their own.

- Nakayama took the NES as a model

and tried to replicate that success

from the design of the console itself,

to the types of games, to the marketing strategy,

and the product of that was the Sega Master System.

(dramatic music)

- [Narrator] Nakayama’s plan is

to unleash the Master System in North America.

- Sega is trying to find a way

to become the Nintendo killer.

(foreboding music)

- [Narrator] In 1986, the Sega Master System

hits store shelves in North America.

Taking a page from Nintendo’s playbook,

Sega hopes to win over gamers

with their own family-friendly character, Alex Kidd.

- A short kid with big ears, weird-looking character,

who punches and kicks his way

around the environments, collecting money.

- But the character is not one

that resonates with American audiences.

It’s not, "Get this for me for Christmas."

- The Sega Master System

could not even make a dent in the video gaming market.

- [Narrator] But Sega wants to take another crack,

and immediately begins developing a new console.

Sega President Hayao Nakayama believes

the key to beating Nintendo is higher powered hardware.

- Hayao Nakayama expects results. He expects success.

He looks to the next big thing.

That’s gonna be 16-bit technology.

(upbeat music)

- [Narrator] While Sega bets on more processing power,

Nintendo doubles down on its biggest star,

but when Minoru Arakawa

gets his first look at the Super Mario sequel,

there’s a problem.

- When Nintendo releases "Super Mario Brothers 2" in Japan,

it looks like the same world

that "Super Mario Brothers" inhabited.

- But it is very difficult and it is not very fun to play,

and that was something that

American audiences weren’t ready for.

- And so Arakawa finds a somewhat easier game

called "Doki Doki Panic,"

and they take out the characters from the previous game

and add Mario and Luigi, and they release the game

in the United States as "Super Mario 2."

(dramatic music)

- [Narrator] "Super Mario 2" becomes a smash hit,

going on to sell 7.5 million copies,

cementing Nintendo’s dominance

as the decision to focus on games and gameplay pays off.

(dramatic music)

But Sega is ready for a comeback

with its new 16-bit console, the Genesis.

- 16-bit is twice the bits.

Why does twice the bits matter?

It’s because you have more color now,

you have more addressable space for music,

so it was demonstrably a more powerful machine.

- [Narrator] Sega releases the Genesis

in the US in August 1989.

- The game that originally comes with the Sega Genesis

is called "Altered Beast."

You remember that? Nobody remembers that.

- I know there were Medusa heads and I know there werewolves

and I know the second player gets to be yellow,

but I don’t know their names.

They didn’t have that staying mascot power.

- [Narrator] "Altered Beast" fails to win over

loyal American gamers who are hooked on Mario

and Nintendo’s four-year-old console.

- Nintendo released "Super Mario Brothers 3"

just a few months later.

Eight million copies of "Super Mario Brothers" sold,

so Nintendo is still crushing Sega.

- Hayao Nakayama realizes that,

if he is going to beat Nintendo at their own game,

a company that rebranded a video game system as a toy,

he needs someone from the toy world,

and that person is Tom Kalinske.

- Tom Kalinske is super interesting.

He’s coming out of Mattel.

He just revitalized Barbie, which was flagging,

and now it’s once again a household name,

but he was a victim of a shakeup.

- [Narrator] After being undercut

in his leadership role at Mattel,

Kalinske has something to prove.

- He needs to feel that

he can really be in the driver’s seat.

- So he tells Nakayama, "I will take over Sega America

if I have complete and total autonomy."

- I’ve got three ideas to reinvent Sega.

First, we cut our price.

Second, we let everyone know Nintendo is for little kids.

Americans, older gamers especially, will respond.

And, third,

we need our Mario.

- [Narrator] Kalinske proposes

an aggressive marketing strategy for the Genesis

that’s as much about Nintendo as it is about Sega.

- He’s gonna take Nintendo head-on.

If the games are gonna be family friendly on Nintendo,

that’s not gonna be the case with Sega.

Sega’s gonna be the bad boy.

(exciting rock music)

Brash, irreverent is the attitude of

the early ’90s teenager.

Gen X is looking for heroes and icons

that speak to the kind of angst and alienation

that they feel as a generation.

- [Narrator] Kalinske needs a character

who is the anti-Mario,

and he learns of a new game in development

with just the attitude he’s looking for.

(dramatic music)

"Sonic the Hedgehog."

- You see the sneakers. You see the way he’s built.

You see the spiky hair.

You know he’s going fast

and you know he’s just bashing through things.

- Ding, ding, ding, ding, ding, picking up all the coins.

Everything was about speed in a way that

this sort of dumpy plumber from Nintendo can’t quite hit.

- "Sonic the Hedgehog" becomes

the perfect video game representation

for the attitude that young people want

with the sly smile and the speed to match.

- Tom Kalinske says, "Yeah, this exciting,

attitude-y, difficult to control,

super cool looking, spiky haired, whirling dervish,

that’s our guy.

(dramatic music)

- [Narrator] Kalinske convinces Nakayama

to make Sonic the system’s new pack-in game.

- Let’s give away Sonic and take Nintendo down.

- And Genesis is reborn.

- It made Sonic the mascot they were looking for.

Sales start taking off. Sonic is recognizable.

It works.

(TV clicks) (dramatic music)

- All of a sudden, Nintendo has a real competitor.

- When Howard Lincoln sees the success of Genesis,

he realizes, "I need to destroy this enemy

in a way that is utter and absolute."

(dramatic music)

(lively music)

- [Narrator] In 1991, Nintendo commands

90% of the American video game market,

but Sega’s "Sonic the Hedgehog"

is named number one game of the year,

and Kalinske is giving it away for free with the Genesis.

The result, Sega sells 15 million Genesis consoles.

(somber music)

(TV clicks)

(VCR whirs)

- Sonic is really the thing that changes Nintendo’s attitude

and they start to have to think about

what it is that’s coming next.

(somber music)

- And that’s the SNES,

the Super Nintendo Entertainment System.

- [Narrator] Nintendo’s new 16-bit console

is more than a match for the Sega Genesis

in terms of power.

- With the Super Nintendo, the graphics are gorgeous,

the speed is faster, but there is one big problem.

- This doesn’t even play our old games.

(dramatic music)

- [Narrator] To keep the price down,

Nintendo designed the Super NES

without backwards compatibility.

- Millions of people who have tapes are buying CDs.

- So, if you had the original Nintendo system,

and you had invested money and time

and maybe you had 30 games,

you could not play them on the Super Nintendo system,

and the problem with this is that

you have all these die-hard Nintendo fans

that basically have to start over,

and, if they’re starting over, they may switch to Sega.

(somber music)

- [Narrator] Nintendo rolls out the Super Nintendo

just before the 1991 holiday season.

- Christmas for years and years

has always been a happy time for Nintendo,

but the Christmas of 1991 is the first time that

they don’t have a dominant Christmas.

- Nintendo packs in a new Mario game, "Super Mario World,"

but, really, it’s not a dramatic difference

from earlier Super Mario games.

It doesn’t tap into the full potential

that Nintendo says the SNES is capable of.

(foreboding music)

- Sega really positioned itself as the defiant one,

the brazen one, the cool one, the fast one.

- Sega’s rise is so meteoric, no one expected it.

Not even Kalinske could have expected this.

Within two years, they went from

only having about 10% of the market share

to 55% of the market share.

Over half becomes Sega and Nintendo is scrambling.

- All I’m saying is that I need the numbers.

- This is a major event.

Nintendo has been the dominant player for a while now,

and not only has Sega beaten them,

they’re out selling them two to one.

That’s huge.

(somber music)

- [Narrator] Howard Lincoln is determined to get back on top

and agrees to a meeting

with an executive from another Japanese electronics giant.

(exciting music)

- Sony was the dominant name in home electronics.

They made everything from your stereos to your TVs.

- Before you could put 500 songs on a watch,

you could put maybe 12, 13, 14 songs on a cassette tape

and walk around with that, and that was Sony.

That was the Sony Walkman.

- [Narrator] Sony has never made a video game system,

but a young executive see an opportunity.

- Olaf Olafsson was

an Icelandic businessman and technologist

who joined Sony in the ’80s.

- On the table is a partnership,

combining Nintendo’s gaming expertise

with Sony’s latest breakthrough technology, CD-ROM.

- On CD-ROM, the entire surface is writeable,

which means the motion can be infinitely smoother.

You can have true music.

You can have real tracks from real artists.

- Sony has a huge R&D department.

They have this amazing ability to produce CD-ROMs

because they’ve been doing it for music.

- This partnership has the potential

to revolutionize video games.

- How does the Nintendo PlayStation sound?

- It’s so crazy to think that there was gonna be

a product called the Nintendo PlayStation.

People go, "No, you made a mistake. That’s not real."

And you have to go, "No, no, no."

Let me say it again for emphasis.

It was the Nintendo PlayStation.

- I like it.

(dramatic music)

- [Narrator] Nintendo executive Howard Lincoln

has been handed an opportunity

to leap beyond the Sega Genesis.

- How does the Nintendo PlayStation sound?

- [Narrator] By partnering with Olaf Olafsson and Sony.

- So, player three has entered the game.

Sony, another Japanese juggernaut,

the leading name in CD-ROM writing and reading technology,

they make a deal with Nintendo to create their own system

that can play CD-ROM games and Super Nintendo cartridges.

(somber music)

- [Narrator] With Nintendo on board, Sony spends millions

to produce a handful of working prototypes

of the Nintendo PlayStation.

- It’s wild to see basically like a Super Nintendo controller

with the PlayStation logo.

It doesn’t make any sense.

That would be like if you told somebody that, at one point,

there was gonna be a Coca-Cola Pepsi.

- It’s got cartridge capability on top

for you to put your games in,

and then it has the ability to play CDs in the front.

It’s a weird Frankenstein video game console.

- [Narrator] It’s Olaf Olafsson’s chance

to show the industry that Sony intends to be a major player.

(exciting music)

(foreboding music)

- The technology we have is groundbreaking

and we feel it will change the world.

(audience applauds)

- It’s the Consumer Electronic Show,

essentially the main focal point

for the entire video game industry.

- It gives me great pleasure to announce an exciting new

Nintendo-Sony partnership.

(audience applauds)

The Nintendo PlayStation.

(audience applauds)

- Olafsson tells the entire world

that there is the Nintendo PlayStation.

- He knows they have the prototypes.

He knows that they’re ready to go.

- And he says, "This is going to hit your marketplace

and be this incredible invention

that you are going to love."

- So, Nintendo executive Howard Lincoln takes the stage.

(suspenseful music)

- The key to the video gaming industry is software.

- And he’s talking about how the future of gaming

is gonna be CD-based.

- This is the moment

that the partnership is going to be announced.

This is why everyone has shown up.

- In order to create the latest gaming software,

we have agreed to a groundbreaking collaboration

capitalizing on CD-ROM technology.

Nintendo is partnering with the company who invented it,

Philips Electronics!

(audience applauds)

- Instead of working with Sony,

they’re actually partnering with Philips.

- This is crazy. This is such a brutal betrayal.

- Here is Olaf Olafsson on the top of the world,

and then, all of sudden, Howard Lincoln says, "Nope,"

on the world stage.

- It wasn’t like Sony knew.

They found out with this announcement

just like the public did, which is ice cold, man.

(somber music)

- What the hell, Howard?

- Sony was rightfully upset.

It’s one thing to not want to work with a competitor.

It’s another thing to work with a competitor,

and, at the 11th hour, say, "I’ve changed my mind,

so you’re on your own

with your millions of dollars of development expenses."

- [Narrator] Howard Lincoln delivered the blow,

but the decision came down

from Nintendo headquarters in Japan.

- At the last minute, Nintendo corporate got cold feet.

They were very concerned with sharing

that much power and information with Sony.

- Nintendo has very secret development processes.

They may have been worried about

Sony stealing their intellectual property.

- The powers that be at Sony were furious,

and, at that point, they vowed

to bring their system to market no matter what.

(foreboding music)

- So, like the old expression says,

the enemy of my enemy is my friend.

Well, now Sony and Sega shared an enemy in Nintendo.

- [Narrator] Olaf Olafsson approaches Tom Kalinske

with the opportunity of a lifetime, a Sega PlayStation.

- Kalinske 100% buys into what it is that they’re selling.

He understands what they’re doing.

He understands why it’s important.

He understands why

it’s the next generation for the US market.

- So, Kalinske thinks that

Nintendo’s misstep in alienating Sony

may be his biggest windfall yet.

Sony and Sega, if they can cooperate,

can make a true juggernaut of a partnership

that will dominate the marketplace.

(tense music)

- Hear me out.

- So, he goes back to Sega,

and he presents this technology from Sony.

- And Kalinske is shot down.

The Sega of Japan executives aren’t interested.

- Sega knows that they’re gonna be going into

CD console development.

They’ve already started that R&D.

- Nakayama says, "We’re not partnering with Sony.

Let’s focus our energy on the development of

a game system called the Sega Saturn."

(somber music)

- What happens is that this really ticks off Sony

and it actually really ticks off Tom Kalinske,

because this partnership made sense,

and the bosses in Japan just didn’t want to go for it.

- It proved to be a very, very costly mistake.

- Kalinske sees the potential,

but the very autonomy that Tom Kalinske wanted,

the very ability to make decisions

is now taken away from him,

so, now, not only is he fighting Nintendo,

he’s also fighting Sega Japan.

(somber music)

- Excellent. Keep up the good work.

- [Narrator] After Howard Lincoln

jilted Sony’s Olaf Olafsson,

Nintendo develops a CD-ROM game drive with another company.

- With Philips, which, if you haven’t heard of,

there’s a reason for that.

- Nintendo, for its entire existence,

had jealously guarded its video game technology.

Nintendo owned all of the circuits

that the games would be programmed on.

- [Narrator] Switching from cartridges to CDs

would mean giving up control and money.

- What ends up happening is

Nintendo pulls a bait and switch on Philips.

- [Narrator] Nintendo pulls its support

for a Philips CD-ROM add-on

and sticks with its own technology.

- Nintendo’s next console didn’t have a CD-ROM.

It was also a cartridge-based console,

and that was the Nintendo 64.

(dramatic music)

- [Narrator] While Nintendo begins work on the N64.

- Sony has been publicly humiliated by Nintendo,

been soundly rejected by Sega of Japan,

so they decide that they’re gonna go it alone,

that they’re gonna make their own game system.

- I’m not sure Sony would’ve had such a thorn in their side

to enter the market themselves, ’cause, again,

they wanted to make peripherals for game companies,

and that back stab from Nintendo

very well could have led them on a vengeful path

to try to take market share with the Sony PlayStation.

- [Narrator] The PlayStation will be

Sony’s standalone, fully 3D-enabled CD game console.

- This is just a complete shift in the gaming space.

No more 2D platformers. No more two dimensions.

This is now three-dimensional gaming.

- A Sony game system, top to bottom, all Sony technology,

and they do have the technology.

What they don’t have is a game library,

and, in the console wars, the real ammunition are games.

- Sony enters this new gaming market of the home console,

without this history of doing arcade development,

without this history of PC development.

- The importance of bringing in

a library of quality games cannot be overstated.

This is an absolutely existential question for Sony.

If they can’t bring in developers to make games,

they don’t have a system.

(foreboding music)

- [Narrator] Olafsson needs to peel away

independent game makers from Nintendo and Sega,

so he asked for a meeting

with the undisputed leader in arcade games, Namco.

- This is the company that created "Pac-Man" and "Galaga"

and they have a particularly strong game

called "Ridge Racer."

- "Ridge Racer" was this insane racing game

that would really only work on an arcade game,

because you needed that power,

and you needed that three dimensions to work with it.

(car engine roars)

(tense music)

- [Narrator] If Sony can win over Namco,

other game makers will follow.

- So, "Ridge Racer" is a terrific arcade game.

We want you to make a home console version.

- It’s 3D graphics.

We’d have to cut the game to squeeze it onto a cartridge.

(tense music)

What is this thing?

- The Sony PlayStation.

It’s built for 3D graphics

and stereo music.

No more synthesizer. Actual songs.

How’d you like to come make games for Sony?

(intense music)

- For Olaf Olafsson, a man who was humiliated,

this is the moment of truth.

(intense music)

(suspenseful music)

- [Narrator] Arcade giant Namco

has agreed to bring its hit games

exclusively to the new Sony PlayStation.

(suspenseful music)

- In courting Namco, all of a sudden,

Sony got the automatic respectability and

recognizability of being a game company.

- [Narrator] Other third-party game makers follow.

Now, Olaf Olafsson has one final decision to make,

choosing the pack-in game

that will become the face of the Sony PlayStation.

- None. We’re not gonna bundle a game.

The PlayStation can speak for itself.

- The Sony PlayStation had no mascot.

This was a game console

that was being sold as a technological wonder,

and it was.

(suspenseful music)

- [Narrator] Both Sony and Sega

plan to launch their new consoles

at the first ever E3 expo.

- Two video display processors

generate character and gameplay images.

- Sega is there to announce

their next gen console, the Sega Saturn.

Sega Saturn has had a lot of trouble in its development.

- Tom Kalinske has a game system he doesn’t believe in

with a design he doesn’t like.

- A custom sound chip

and a digital signal processor yields up to-

- He knows it doesn’t have the games that it needs,

and he knows they rushed the Sega Saturn to market.

- We started our rollout of the Sega Saturn yesterday.

Our retail price is between $399 and $449.

(audience applauds) (somber music)

- And then, with bated breath,

Ola Olafsson and his team take the stage at the E3

to announce the delivery of the brand new Sony PlayStation.

- I’m gonna ask

Sony Computer Entertainment of America President Steve Race

to join me for a brief presentation.

(audience applauds)

- Olaf Olafsson sends out a man named Steve Race

who delivers one epic mic drop of a comment.

- $299.

(audience cheers)

- The PlayStation is gonna sell for a hundred dollars less.

That’s a huge announcement.

- This has gotta be like this amazing moment for Olafsson.

(triumphant music)

- [Narrator] Sony’s price and its gameplay

draw in consumers.

By the end of 1995, 800,000 PlayStations are sold in the US,

compared to 400,000 Saturns.

- And, all of a sudden, Sony is solidified.

People are rushing to buy this console and Sony has a hit.

- [Narrator] In less than a decade,

the PlayStation 2 will become the first video game system

to ship over 100 million consoles.

(triumphant music) (audience cheering)

(suspenseful music)

- Sony is now a video game company.

Sony’s video game arm ends up becoming

something like 60% of Sony’s revenues.

- The PlayStation absolutely revolutionized gaming.

They were the first console to say,

"3D video gaming is here."

So, the Nintendo 64 had to meet that.

- [Narrator] The Nintendo 64

launches in North America in 1996.

- I now am moving upon multiple axes in my Super Mario game.

I’m controlling cameras.

(exciting music)

- But while Nintendo and Sony take the console wars

into the third dimension, Sega struggles with flat sales.

- Sega slowly fades away.

We have one more console from them, the Sega Dreamcast.

After that, they leave the console space.

They now make software.

(gentle music)

To paraphrase Tom Kalinske,

it was the dumbest move in the history of business

to not partner with Sony.

- The legacy of Sega is, in some ways, making games grow up.

- These companies are still duking it out.

Nintendo still is the family friendly,

and PlayStation’s a little darker, a little more, you know,

exciting and scary or mysterious.

- They go to GameCube, PlayStation 3.

By the time you get to the Wii,

PlayStation 4, Wii U, Xbox 360,

and then you get in this similar arms race again.

- In today’s world,

kids go to college to develop video games

because they’re so great,

and because there’s so many followers and gamers out there.

- The video game industry

changed the way we interacted with mass media.

If I’m reading a book,

I am imagining myself as the protagonist of the book.

If I’m watching a movie,

I may identify with the protagonist of the movie,

but I’m along for the ride,

but, I’m playing a video game, I am the ride.

(exciting music)

(car engine roars)