Recaps

Sega fueled North American doubts about Nintendo’s NES by invoking the Atari Graveyard, prompting Minoru Arakawa to hold a press conference that failed to dispel suspicions. Yamauchi Hiroshi told him to stop focusing on media coverage and prepare hands-on NES demonstrations, leaving Nintendo to face a growing storm in the North American market.

• David Rosen directed his subordinate to remind the media of the Atari Graveyard and warn consumers about another Atari-like failure.
• Sega’s references to the Atari Graveyard sparked a wave of articles questioning whether the NES was a deceptive marketing ploy or another doomed console.
• Minoru Arakawa arranged a press conference and defended the NES as a new home entertainment system, but reporters continued challenging its identity and prospects.
• Minoru Arakawa reported the press conference’s setbacks to Yamauchi Hiroshi, who dismissed Sega’s influence as unimportant.
• Yamauchi Hiroshi instructed Minoru Arakawa to organize offline NES demonstrations so players and retailers could experience Super Mario Bros. themselves.

Takuya joined Oba Kotaro and Masami Kurumada at Tatsunoko Studio to plan the Fatal Fury anime and refine its characters. Kurumada embraced a fresh design direction, then drew Takuya aside to show him something.

• Takuya heard that Sega’s console version of Tetris was complete and the handheld version was nearing completion.
• Takuya, Oba Kotaro, and Masami Kurumada outlined the Fatal Fury anime’s opening, flashbacks, setbacks, tournament arc, and finale.
• Takuya suggested design changes for Terry and Andy, and Kurumada incorporated them into his sketches.
• Oba praised Kurumada’s revised designs, and Kurumada became excited about the new style.
• During a break, Masami Kurumada mysteriously asked Takuya to step aside so he could show him something.

Takuya examined Masami Kurumada’s early Saint Seiya sketches and praised their imaginative concept, then offered candid advice about strengthening plot and character development. Kurumada accepted his suggestions and resolved to study mythology before refining the story, while Takuya’s creative bond with Kurumada and Oba Kotaro grew.

• Masami Kurumada showed Takuya sketches for Saint Seiya and explained his ideas about Cosmo, Cloths, and youths protecting a goddess.
• Takuya praised the concept, then cautioned that Kurumada’s plots and character shifts could feel formulaic or insufficiently developed.
• Takuya urged Kurumada to draw on Greek, Norse, and Egyptian mythology to deepen the world and give characters more coherent motivations.
• Masami Kurumada accepted Takuya’s criticism and said he would study myths in Europe after finishing Fatal Fury.
• Takuya felt encouraged by Kurumada and Oba Kotaro’s response and recognized that their relationship had begun to grow beyond a client-and-contractor arrangement.

Nakayama Takuya guided Sega’s Third Development Department through early development of Fatal Fury, helping the team build a collision-editing tool, optimize the Pre-System 16 board, and improve its character animation. The game was running above 50 Hz in preliminary tests as the programmers worked toward 60 Hz and the artists revised their pixel art.

• Takuya reassured the team and asked Shimizu and Oyama to help develop the Collision Configurator.
• Takuya, Shimizu, and Oyama built a tool that imported pixel-art animations and allowed basic hitbox configuration.
• Takuya urged the programmers to target 60 Hz and helped them optimize CPU use on the Pre-System 16 board.
• The technical team assigned backgrounds and the UI to an added Zilog Z80 CPU, bringing preliminary performance above 50 Hz.
• Takuya advised the art team to strengthen the characters’ sense of impact with exaggerated motion, distinct attack phases, hit-stop frames, and effects.

Sega’s handheld Tetris became a nationwide sensation, selling 12 million units by the end of August and cementing Takuya’s standing at the company. Yamauchi Hiroshi took note of the handheld market’s potential but refocused on the surging NES business in North America, as an executive raised new intelligence at Nintendo’s meeting.

• Tetris on Sega’s handheld spread across Japan, drawing players of all ages and earning an NHK special feature.
• Sega’s sales director reported that handheld Tetris had sold more than 12 million units worldwide by the end of August.
• Sega executives congratulated Takuya, who credited the company and team, while Nakayama Hayao took pride in his son’s success.
• Yamauchi Hiroshi felt uneasy about the handheld market’s growth but shifted his attention back to North America after NES trial events boosted Super Mario Bros. and NES sales.
• At a Nintendo executive meeting, an executive brought up a notable piece of intelligence.

Nintendo delayed Namco’s Famicom version of Pac-Man so it could launch three days before Sega’s mysterious “K” arcade project and disrupt its promotion. Nakamura Masaya agreed to Nintendo’s demand but left determined to remember the slight and consider Sega as a potential ally.

• At a Nintendo meeting, Yamauchi Hiroshi assigned Yokoi Gunpei to prepare a feasibility report for a handheld with interchangeable cartridges.
• After hearing that Sega was developing a major arcade project called “K” with an animation director and manga artist, Yamauchi Hiroshi ordered Pac-Man delayed until its release could be timed three days before Sega’s game.
• A Nintendo representative told Nakamura Masaya that Namco’s Famicom version of Pac-Man would miss its planned pre-Christmas release, despite Nakamura’s objections.
• Nakamura Masaya accepted Nintendo’s decision, then privately vowed to remember the insult and considered whether Sega might become Namco’s friend.

Nakayama Takuya oversaw steady progress on Fatal Fury’s demo and animation, then learned Nintendo had delayed Namco’s Famicom Pac-Man release in response to Project K. At Sega’s board meeting, David Rosen reported that the NES was gaining ground in North America, prompting Sega’s sales director to urge a more active response.

• A Sega programmer told Nakayama Takuya that Terry’s moves had been integrated smoothly, and Takuya expected a presentable Fatal Fury demo by the end of the month.
• Yu Suzuki visited Nakayama Takuya and wondered about making fighting games in planar or 3D space before Takuya left for Tatsunoko.
• Nakayama Takuya backed Udagawa Kazuhiko’s proposal to keep transitional fights restrained, and Oba Kotaro agreed to the approach.
• Nakayama Takuya overheard that Namco’s Famicom version of Pac-Man had been delayed and concluded Nintendo was targeting Project K, so he began considering how to use the move to expand the project’s influence.
• David Rosen reported that Super Mario Bros. had boosted NES sales in North America and was pressuring the Master System, after which Sega’s sales director called for a more active strategy.

Nakayama Hayao shelved Sega’s 16-bit console proposal and made the success of Takuya’s Project “K” central to the company’s next-generation decision. After learning Nintendo had delayed the Famicom version of Pac-Man, Takuya launched a publicity campaign for Fatal Fury featuring its creative collaborators.

• Nakayama Hayao postponed the 16-bit console proposal and said Project “K” would determine whether Sega pursued the next generation.
• Takuya heard that Nintendo had delayed Namco’s Famicom version of Pac-Man and recognized it as an attack on Project “K.”
• Takuya instructed Suzuki to arrange magazine interviews with Tatsunoko director Oba Kotaro and Masami Kurumada to promote the project.
• Oba Kotaro described Sega’s investment in animation and its close collaboration with the game development team in magazine interviews.
• Masami Kurumada discussed designing Fatal Fury’s characters and revealed that he was developing a manga about boys fighting for a mythological goddess.
• Login and Animage published further reports, including Login’s unconfirmed rumor that the Famicom version of Pac-Man had been postponed indefinitely.

Fatal Fury’s publicity success strengthened support for Project "K" and stirred Nakamura Masaya’s resentment toward Nintendo’s control of Namco. At Sega, Nakayama Takuya demonstrated Fatal Fury’s combat techniques to the development team, leaving the developers eager to master the game.

• Nakayama Hayao reviewed the positive coverage of Fatal Fury and saw the publicity as a boost for Project "K" and Sega’s next-generation plans.
• Nakamura Masaya brooded over Sega’s promotional success and wondered whether Namco had to keep obeying Nintendo.
• Yu Suzuki and another team leader tried the Fatal Fury demo but struggled to execute its special moves.
• Nakayama Takuya demonstrated precise movement, special attacks, and combinations with Terry, impressing the gathered developers.
• The developers watched Takuya continue his sequence against Geese as the demonstration carried on.

Takuya demonstrated Fatal Fury’s smooth combat and confirmed that its core mechanics performed well, but a hitbox bug revealed the need for further testing. He assigned the team to fix the flaw and build more characters, then warned that balancing the growing roster would be a major challenge.

• Takuya performed a combo with Terry that impressed the developers and Yu Suzuki.
• Takuya questioned Team Leader Shimizu about performance, and Shimizu confirmed that transitions, hit detection, frame rate, and input delay met expectations.
• Tanaka discovered that Geese’s Atemi Throw could grab Terry despite the hitboxes not overlapping, and Takuya identified a detection-range bug.
• Takuya ordered the team to inspect every move’s detection data and prioritize creating Andy Bogard and Joe Higashi for a three-character build.
• Takuya explained that character balance and counterplay would be essential to Fatal Fury’s success.

Sega’s third development group argued over balancing Fatal Fury while Nakayama Takuya encouraged the developers to think through the broader effects of their changes. As Takuya quietly sketched plans for a new project, Nintendo’s leaders discussed the NES’s North American success and dismissed Sega as no serious threat there.

• Shimizu, Yu Suzuki, and the other developers debated character frame data, hitboxes, and matchups as they refined Terry, Andy, and Joe Higashi.
• Nakayama Takuya guided the arguments with questions and left Shimizu and Yu Suzuki in charge of balance adjustments and developing the next characters.
• Nakayama Takuya privately sketched intricate electronic-component-like designs in a locked notebook as seeds for a future Sega project.
• Minoru Arakawa told Yamauchi Hiroshi that Nintendo expected NES sales in North America to exceed one million units before year’s end.
• Yamauchi Hiroshi dismissed Sega’s Master System and its Fatal Fury campaign as no substantive threat to Nintendo’s North American market.

Minoru Arakawa reported strong NES sales to Yamauchi Hiroshi as Nintendo remained confident in North America, while Namco’s Nakamura Masaya worried about the delayed Famicom version of Pac-Man. In December, a high-impact Fatal Fury anime teaser sparked widespread interest, and Nakayama Takuya monitored the reaction as the game neared completion.

• Minoru Arakawa told Yamauchi Hiroshi that NES sales were on track to exceed one million units before year’s end, and Yamauchi asked about Sega’s activity in North America.
• Nakamura Masaya reviewed Namco’s Famicom sales reports and remained troubled by the delay of the Famicom version of Pac-Man.
• Fatal Fury’s January anime release and its promotional video were announced, with Masami Obari editing the animation teaser.
• Teenage viewers reacted enthusiastically to the teaser, spreading interest in Fatal Fury beyond gaming circles.
• Shimizu and Yu Suzuki brought the game’s balance and character designs to the final testing stage as Nakayama Takuya tracked the trailer’s market impact.

Takuya recorded move demonstrations and combos to add to the ends of the Fatal Fury anime episodes, with later episodes set to reveal Geese and promote the first Sega Tournament. At Nintendo, Yamauchi Hiroshi dismissed Sega’s campaign as empty marketing and ordered the company to stick to its existing strategy.

• Takuya planned to record move inputs for the anime and use its final episodes to reveal Geese, demonstrate Terry and Andy’s combos, and advertise the first Sega Tournament.
• Takuya, Shimizu, and Yu Suzuki recorded every character’s moves, including Geese’s, and Takuya demonstrated practical combos for Terry and Andy.
• Takuya sent the edited footage to Tatsunoko Studio and explained how the move demonstrations, Geese’s unlock condition, combos, and tournament trailer would fit into the episodes.
• Yamauchi Hiroshi reviewed Sega’s animated promotion with Nintendo executives and dismissed it as a marketing bubble that could not overcome the gap between animation and games.
• Yamauchi ordered Nintendo to maintain its focus on North America and the Famicom software lineup rather than respond to Sega’s arcade promotion.

Namco rushed to release the Famicom version of Pac-Man ahead of Sega’s Fatal Fury after Nintendo ordered it used to blunt the rival game’s momentum. Pac-Man’s launch sales were passable but attracted little excitement, leaving Nakamura Masaya aware that attention had shifted to Fatal Fury.

• Nakamura Masaya received Nintendo’s order for Namco to promote the Famicom version of Pac-Man and use it to draw attention away from Fatal Fury.
• Sega and Tatsunoko Studio announced that Fatal Fury’s arcade release and TV anime premiere would both take place on January 11, 1986.
• Yamauchi Hiroshi ordered Namco to release Pac-Man on January 8, before Fatal Fury, and Nakamura Masaya agreed to comply.
• Namco hurriedly prepared Pac-Man’s promotion and distribution, then launched the Famicom game on January 8.
• Pac-Man achieved passable sales but drew little public or media excitement, and Nakamura Masaya reflected on Fatal Fury’s momentum and Nakayama Takuya’s strategy.

Fatal Fury’s arcade release drew huge crowds across Japan, and its television anime premiere ended with a gameplay tutorial that taught viewers how to perform Terry’s special moves. Nintendo and Namco watched Sega’s success cautiously as the campaign’s next phase began.

• On January 11, players flocked to Sega arcades, where Fatal Fury’s characters and moves drew excited crowds and strong reports from branches nationwide.
• Shimizu praised Nakayama Takuya for the game’s success, while Takuya said the anime and its post-credits tutorial had yet to make their impact.
• Yamauchi Hiroshi reviewed reports of Fatal Fury’s arcade success and told Nintendo executives to keep watching Sega’s next moves.
• Nakamura Masaya learned that Fatal Fury had taken arcades by storm and wondered whether the industry was about to change.
• At six in the evening, the first Fatal Fury anime episode aired, then showed gameplay footage with clear joystick and button commands for Terry’s special moves.
• Teenage viewers recognized the footage as a move tutorial, wrote down the commands, and became eager to try the game.

The Fatal Fury anime’s ending tutorial drove a nationwide surge of players to arcades, boosting the game’s revenue and engagement. Sega celebrated the results as Yamauchi Hiroshi ordered Nintendo to study the strategy and monitor Sega’s next moves.

• After the anime ended, teenagers flocked to arcades and learned Fatal Fury special moves by following the tutorial shown during the credits.
• Arcades across Japan reported record Fatal Fury earnings and long queues, while players practiced moves and spent more time at the machines.
• Team Leader Shimizu shared the overnight reports with Yu Suzuki and Nakayama Takuya, who said Sega would continue its planned promotions.
• Yamauchi Hiroshi reviewed Nintendo’s report on the anime’s effect and ordered a joint task force to analyze the tutorial’s impact on player behavior and Nintendo’s strategy.
• Yamauchi Hiroshi warned his executives not to underestimate an opponent who could draw money from players in a new way.

The success of Fatal Fury unsettled Namco and prompted Konami to delay several releases, but Nintendo pressured Konami to keep its schedule. In Kyoto, Shigeru Miyamoto completed final checks on The Legend of Zelda, leaving Nintendo confident in the upcoming Disk System.

• Nakamura Masaya reviewed reports of Fatal Fury’s anime-driven arcade boom and saw Namco’s Pac-Man promotion falter beside Sega’s success.
• Kozuki Kagemasa decided to postpone The Goonies, Circus Charlie, and the Famicom version of Gradius to avoid Fatal Fury’s broadcast peak.
• Nintendo’s liaison threatened to reconsider Konami’s preferential royalty terms after Konami explained its schedule changes.
• Kozuki Kagemasa accepted the pressure from Nintendo and chose to endure rather than challenge its control.
• Shigeru Miyamoto signed off on The Legend of Zelda after final testing, and Yokoi Gunpei praised the game and expressed confidence in the Disk System.

Nakayama Takuya warned Nakayama Hayao that Nintendo’s Famicom Disk System and The Legend of Zelda could reshape home gaming through larger games and save functionality. He left Hayao considering how Nintendo’s strategy might threaten Sega’s long-term position despite Fatal Fury’s current popularity.

• Nintendo launched an aggressive campaign promoting the Famicom Disk System’s storage capacity and save feature alongside The Legend of Zelda.
• At dinner, Nakayama Hayao asked Takuya to join him in the study after noticing he had come home with something to discuss.
• Hayao praised Takuya’s work on Fatal Fury, including its anime tie-in and post-credits tutorial.
• Takuya explained that the Disk System’s larger capacity could enable expansive games and that saving progress could deepen player investment and loyalty to Nintendo’s platform.
• Takuya told Hayao that Fatal Fury’s popularity might be short-lived compared with Nintendo’s growing advantage in the home console market.

Takuya persuaded Nakayama Hayao to consider a next-generation 16-bit console as Sega’s answer to Nintendo’s growing dominance. After The Legend of Zelda and the Famicom Disk System launched to acclaim, Takuya saw their success as leverage for his proposal, but the chapter ended as he received an unexpected courier envelope.

• Takuya told Nakayama Hayao that Sega should build on its arcade strengths while preparing a powerful 16-bit home console rather than copying Nintendo.
• Nakayama Hayao asked Takuya to report on The Legend of Zelda’s performance and present his vision to Sega’s board.
• Nintendo released the Famicom Disk System and The Legend of Zelda on February 21, drawing huge crowds and widespread attention.
• Takuya read glowing reviews of The Legend of Zelda and viewed its success as evidence he could use to persuade Sega’s conservative directors to invest in a new console.
• A receptionist stopped Takuya at the elevator and handed him a thin courier envelope.

Takuya watched Saint Seiya’s progress and oversaw Sega’s games and anime plans as The Legend of Zelda continued to dominate the home-console market. The final Fatal Fury anime episode announced Sega’s first nationwide esports tournament, drawing huge crowds and excitement, just as Nintendo made another major announcement.

• Takuya received a new Weekly Shonen Jump issue from Masami Kurumada and saw that Saint Seiya’s artwork, pacing, and momentum had improved.
• Sega and Tatsunoko Studio prepared English VHS releases of the Fatal Fury anime to test the North American market.
• The Legend of Zelda’s save feature helped sustain strong sales and increased pressure on third-party publishers such as Konami and Namco.
• The final Fatal Fury anime episode announced the first Sega Esports Tournament, with prefectural qualifiers leading to a final at Tokyo Budokan.
• Players flocked to arcades to train for the tournament, and Sega executives celebrated the game’s growing popularity and extended lifespan.
• Nintendo announced another major development in Kyoto.

After Nintendo announced Dragon Quest, Sega’s executives debated how to answer Nintendo’s growing dominance in the home console market. Takuya urged Sega to develop a 16-bit console built around System 16 and hinted that he had a plan to fund it.

• Nintendo and Enix announced Dragon Quest, alarming game companies already struggling to compete with The Legend of Zelda and the Famicom Disk System.
• Nakayama Hayao warned Sega’s directors that save data and deep games threatened the Master System and could eventually affect Sega’s arcade business.
• David Rosen reported that Sega’s esports tournament had drawn strong interest in Japan and North America, but directors remained wary of the cost of developing a new console.
• Nakayama Hayao summoned Takuya to explain his advice to the shareholders.
• Takuya argued that Sega needed a generational leap and proposed using the Motorola 68000 and System 16 to support new arcade games and a future console with a broad launch lineup.
• Takuya said he had prepared a new plan to create revenue and ease the financial burden of developing the console.

Takuya’s report persuaded Sega’s shareholders to unanimously accelerate development of a 16-bit home console, and he organized the hardware and game teams to prepare for it in secret. Sega publicly framed the work as System 16 investment and a new light-gun project, while Nintendo and its rivals remained suspicious and tried to uncover the truth.

• Takuya left the shareholders’ meeting after promising to explain his new revenue projects later, and Nakayama Hayao secured unanimous approval to accelerate the 16-bit console plan.
• Yu Suzuki asked Takuya about the meeting, then returned to Team Two after Takuya told him to await an official notice and sign a nondisclosure agreement.
• Takuya told Development Team Three to finish its current work that week, exciting the team with the prospect of a new project.
• At the hardware development meeting, Takuya proposed a console based on the System 16 board and Motorola 65000, and the hardware and game teams agreed to prepare for it.
• Sega concealed the console plan by presenting its work as System 16 investment and new light-gun development, while Yamauchi Hiroshi ordered Nintendo to investigate and infiltrate Sega.

At a Sega planning meeting, Nakayama Takuya presented Pokémon as a digital companion product designed to meet demand for low-maintenance emotional companionship. He outlined its collecting, linking, animation, and merchandise potential, while leaving its connection to Sega’s existing gaming business for later.

• Sega’s game development head reported that Out Run’s early demo was complete and other projects were nearing completion.
• Nakayama Takuya presented survey findings about families’ limited time and people’s desire for companionship from pets.
• Takuya unveiled a red-and-white sphere and introduced Pokémon, digital companions users could care for through simple interactions.
• Takuya proposed linking Pokémon Balls so their companions could interact or battle, encouraging social play and collecting.
• Takuya showed designs for Charmander, Squirtle, and Bulbasaur and proposed an animated series and merchandise such as stickers, pendants, and plush dolls.
• When asked how Pokémon would connect to Sega’s existing arcade and console businesses, Takuya said he would reveal that at a suitable time.

Nakayama Takuya arranged hardware and software development for the Pokémon electronic pet and approached GALLOP to produce a Pokémon anime. The chapter ended with Takuya presenting the concept materials to Kunihiko Yuyama and GALLOP’s creative team to begin discussing production.

• Nakayama Takuya asked the Hardware Development Department to make the Pokémon electronic pet durable enough to withstand years of frequent use, while Group Leader Shimizu took the software requirements to Development Team Three.
• Takuya asked Mr. Suzuki to contact GALLOP about adapting Pokémon into a major children’s anime and to approach San-X about merchandise.
• GALLOP responded eagerly, and about a week later Takuya and Mr. Suzuki met the studio’s president and creative staff, including Kunihiko Yuyama.
• GALLOP’s president and Mr. Suzuki left to discuss business terms, while Takuya showed Yuyama and the creative team Pokémon’s character designs, world setting, and main story arc.

Nakayama Takuya presented GALLOP’s creative team with the Pokémon world, its 151 initial Pokémon, and the Kanto adventure outline, winning their admiration and approval. Kunihiko Yuyama then took Takuya to meet President Wakana and Mr. Suzuki to discuss the partnership.

• Takuya distributed his Pokémon materials to Yuyama and GALLOP’s core creative team, who studied the creatures, worldbuilding, and story outline.
• Yuyama and the team became absorbed in the detailed designs and Kanto journey, and Yuyama praised Takuya’s work.
• Takuya explained the Kanto story and answered the team’s questions about Pokémon, Trainers, and the world’s tone.
• GALLOP’s creative team approved the project’s feasibility, and Yuyama proposed moving to the president’s office to settle partnership details.
• Takuya agreed and went with Yuyama to meet President Wakana and Mr. Suzuki.