Recaps

Nakayama Takuya celebrated Sega’s past success before unveiling Jupiter, the company’s next-generation console, and revealing its hardware specifications. The presentation left developers and Ken Kutaragi stunned by Jupiter’s design, performance, and Sony-supplied CD-ROM drive.

• Nakayama Takuya showed Sega’s software sales and thanked partners for helping expand games into pop culture.
• Nakayama Takuya unveiled the Jupiter console and explained its name as Sega’s fifth home-console step.
• Nakayama Takuya revealed Jupiter’s custom R3000S CPU, prompting Ken Kutaragi to recognize it as the architecture Sony had pursued for PlayStation.
• Nakayama Takuya claimed Jupiter could produce 320,000 textured and lit polygons per second, startling the audience.
• Nakayama Takuya announced that Jupiter used CD-ROM and thanked Sony for supplying its stable 2x drive.

Nakayama Takuya presented Jupiter’s hardware and its arcade-ready features, then unveiled its launch games as Ken Kutaragi worried that Sony’s financial troubles would leave the PlayStation short of funds. The press conference ended this excerpt with Nakayama demonstrating Jupiter versions of Virtua Fighter 2, Fast & Furious, and Gundam Battle Operation.

• Nakayama Takuya touted Jupiter’s compatibility with Sega’s Model 2 arcade board and its development tools as proof that the future had arrived.
• Ken Kutaragi judged Jupiter’s design and specifications while worrying that Sony’s Columbia Pictures losses could lead to budget cuts for the PlayStation.
• Tsujimoto Kenzo teased Ken Kutaragi about Sega’s future, but Kutaragi refused to take the bait.
• Nakayama Takuya introduced Jupiter’s launch lineup and showed Virtua Fighter 2 running on real hardware without downgrades or loading screens.
• Nakayama Takuya demonstrated Fast & Furious and Gundam Battle Operation, explaining that Jupiter’s bundled twin-stick controller supported Gundam’s controls.

Nakayama Takuya presented a lineup of Jupiter games that showcased Sega’s arcade-to-console features and first-party strength, leaving Ken Kutaragi and rival companies worried about the competition. The conference ended with distributors and developers reassessing their plans as the pressure to match Sega’s games mounted.

• Nakayama Takuya demonstrated Jupiter’s arcade memory-card compatibility, then showed Sonic 3D, Phantasy Star III, Paper Pokémon Adventure, and Demon Samurai.
• The audience applauded Demon Samurai, and Nakayama Takuya promised that some games would launch with Jupiter while the rest would arrive within four months.
• Ken Kutaragi concluded that Sega’s broad, proven game lineup gave Sony a major disadvantage, while Nakamura Masaya considered pushing Namco’s Tekken team to work overtime.
• Nakamura Masaya and Kozuki Kagemasa saw Sega’s games as threats to Tekken and Castlevania, while Tsujimoto Kenzo remained prepared for Capcom to support the console if sales justified it.
• Sakaguchi Hironobu watched the demonstrations with excitement.

At the Jupiter press conference, Nakayama Takuya announced the console’s 39,800-yen price, stunning Sony’s Ken Kutaragi and revealing that Sega could afford the price without taking a loss. Nakayama began to address the release date but paused before revealing it.

• Sakaguchi Hironobu was inspired by Phantasy Star III’s cinematic storytelling, while Shigeru Miyamoto was struck by the paper-thin Pikachu’s clever visual style.
• Nakayama Takuya revealed Jupiter’s 39,800-yen price, prompting uproar among the press and attendees.
• Ken Kutaragi realized Sega had matched Sony’s planned PlayStation price and worried that Jupiter’s hardware costs made the move financially reckless.
• Tsujimoto Kenzo asked whether Sega planned to sell Jupiter at a loss, and Nakayama’s confidence signaled that Sega could withstand the pricing strategy.
• Nakayama explained that Sega’s supply chain and cheaper production kept Jupiter from losing money at 39,800 yen, unlike Sony’s likely position.
• Nakayama began to announce Jupiter’s release date, then raised a finger to his lips before giving it.

After Sega’s Nakayama Takuya ended his press conference without revealing the Jupiter’s release date, Sony executives debated matching its 39,800-yen price despite the expected losses. Norio Ohga approved the price cut, reasoning that Sega’s use of CD-ROMs would also generate royalties for Sony.

• Nakayama Takuya left the stage without answering reporters’ questions or announcing the Jupiter’s release date.
• Ken Kutaragi, Nobuyuki Idei, and Ryoji Chubachi debated the losses Sony would face if it priced the PlayStation at 39,800 yen.
• Norio Ohga argued that Sony had to build the PlayStation’s installed base and could not abandon the project after its large development costs.
• Norio Ohga pointed out that Sega’s Jupiter would pay Sony royalties for its CD-ROM technology and help popularize the format.
• Norio Ohga set the PlayStation’s price at 39,800 yen, and Ken Kutaragi agreed to press ahead.

Sony’s leaders negotiated concessions to protect the PlayStation project from opposition within the company. They agreed to justify it with a DVD strategy and budget cuts, then sent Ken Kutaragi to defend the plan at the senior management meeting.

• Nobuyuki Idei warned that the board would reject a loss-making PlayStation plan, and Ryoji Chubachi argued that abandoning it would waste the investment already spent.
• Ken Kutaragi offered to support the Sony-Philips MMCD format and promote DVD-ROM as the storage medium for Sony’s next-generation console.
• Ken Kutaragi canceled royalty discounts for most developers, proposed delayed tiered rebates, and recommended freezing non-core hiring and spending until PlayStation passed its life-or-death line.
• Norio Ohga accepted the concessions but told Ken Kutaragi to explain Sega Jupiter at the next Tuesday senior management meeting.
• Ken Kutaragi agreed to attend and said he would use the 39,800 price to demand that Sony back PlayStation or disband the project team.

Famitsu editor-in-chief Hirokazu Hamamura made Sega’s Jupiter the cover story, declaring that the next-generation console war had begun. The press and Japanese media celebrated Jupiter as a technological and national-industrial breakthrough, while Nakayama Takuya knew its low price depended on production moved overseas.

• Hirokazu Hamamura ordered Famitsu to put Jupiter and its 39,800-yen price on the cover, moving the original headline stories to page three.
• Sasaki explained that Jupiter’s hardware could bring Model 2 arcade graphics home, while developers valued its accessible tools and Sega’s announced games drew attention.
• Hirokazu Hamamura speculated that Nakayama Takuya was waiting to time Jupiter’s release against Sony and wrote, “The Next-Generation War Has Arrived!” on the cover sketch.
• Newspapers and NHK presented Jupiter as a major technological achievement and a potential engine for Japan’s economy.
• Nakayama Takuya told Sato Hideki that the media had missed the real reason for Jupiter’s 39,800-yen price: production had moved overseas.

Nakayama Takuya kept Jupiter’s release date secret while Sega prepared to challenge Sony with a low-priced North American launch. He ordered Tom Kalinske to get the Tijuana factory ready to produce Jupiter at a target price of 299 dollars.

• Nakayama Takuya told Sato Hideki to wait a month before announcing Jupiter’s release date so Sony would remain uncertain.
• Japanese students worried about affording Jupiter and its games, and the unannounced release date prompted players to save money.
• American players inundated Sega North America with questions about Jupiter’s price and release date, and Tom Kalinske relayed their excitement to Nakayama Takuya.
• Nakayama Takuya asked Kalinske about the Tijuana assembly lines and explained that assembling imported components in Mexico could help avoid tariffs on complete consoles.
• Nakayama Takuya told Kalinske to achieve a 299-dollar price for Jupiter in the United States.

Nakayama Takuya set Sega’s Jupiter stockpiling and launch secrecy plans while examining discrepancies in the company’s supply chain. He sent Hisao Oguchi to China to pressure factories to meet shipment targets without launching a broad purge.

• Nakayama Takuya ordered Kalinske to stockpile Jupiter consoles and keep North America’s launch date secret until Japan announced it.
• Nakayama Takuya noticed excess component orders and delayed VRAM shipments in Sega’s supply reports and asked Hisao Oguchi to inspect them.
• Hisao Oguchi identified suspicious losses and customs delays, and Nakayama Takuya suspected components and factory capacity were being diverted to unofficial products.
• Nakayama Takuya told Hisao Oguchi to visit China, focus on shipment volumes, and report management gaps to Directors Terauchi and Hatano.
• Nakayama Takuya warned that Nine-Tattoo Dragon’s contacts could investigate private container swaps if official shipments were delayed further.

Hisao Oguchi prepared to travel to China to investigate supply-chain irregularities, while Nakayama Takuya told him to treat Mercury Electronic Technology as a separate matter. The chapter traced Mercury’s origins in the struggling Yanshan Software team and how Takuya helped it develop a Mega Drive-based learning machine.

• Hisao Oguchi asked whether he should investigate Mercury Electronic Technology, and Nakayama Takuya told him to visit politely but not include it in the supply-chain investigation.
• Hisao Oguchi arranged to hand off his duties and request security personnel before traveling to China.
• Nakayama Takuya recalled finding the impoverished Yanshan Software team, whose modified Famicom games were quickly undercut by cheap knockoffs.
• Takuya redirected Yanshan toward Sega’s Mega Drive and Game Pocket, where its technical expertise and Nine-Tattoo Dragon’s sales network gave it an advantage.
• Founder Fu Zan proposed combining a Mega Drive with a keyboard and improving its speech output, and Takuya helped launch Mercury Electronic Technology to develop the learning machine.
• Sega’s hardware team approved Yamaha YMZ284B chips for Mercury’s English-learning machine.

Fu Zan’s team turned Mercury’s Mega Drive-based learning machine into a successful export product by combining English lessons with parental progress monitoring. After Mercury earned more than two million US dollars, Fu Zan asked to make Sega games, and Nakayama Takuya invited the team to Tokyo for training.

• Fu Zan’s team fitted a 5MB ROM into a cartridge and built Mercury One, an English-learning machine with pronunciation, quizzes, and study records.
• Nakayama Takuya directed Sega to market Mercury One through bookstores and schools, and delayed the first batch’s distributor payments to encourage sales.
• Mercury One became popular in markets including Seoul, Mumbai, and Moscow, and Mercury Electronic Technology received a foreign-exchange payment exceeding two million US dollars.
• Fu Zan asked Nakayama Takuya to let his team develop Sega games, and Nakayama told them to come to Tokyo and see how Sega made games.
• Fu Zan and several core team members arrived at Sega Headquarters, where Shimizu gave them temporary staff badges for their training period.

Fu Zan and the Mercury programmers completed their training at Sega, where Shimizu’s team showed them how far next-generation development exceeded their experience. As they prepared to return to Fuzhou, Nakayama Takuya told them to hold off on coding and begin with a weeklong postmortem.

• Shimizu assigned Fu Zan and the Mercury programmers to help debug the port of Gundam Battle Operation, and they struggled to keep up with Sega’s development process.
• Fu Zan watched Sega port the arcade game to the Jupiter architecture and realized Nakayama Takuya had brought them to demonstrate the gap between their skills and Sega’s.
• On their final day, the programmers crowded around Nakayama Takuya, who signed their Gundam Battle Operation disc and joked about its future value.
• Fu Zan admitted the training had opened his eyes, and Nakayama Takuya praised his notebook of technical sketches before asking about Mercury’s plans.
• Nakayama Takuya advised Mercury not to rush into coding and required the team to shut down its computers and hold a postmortem during its first week back.

Nakayama Takuya warned Fu Zan and the Mercury Electronics team to digest their technical lessons and avoid relying on Chinese historical or cultural themes for their first international game. He left them with the need to prioritize a comprehensible, commercially viable debut before attempting cultural exports.

• Nakayama Takuya told Fu Zan to hold a week-long technical seminar after returning to China and warned that later Sega consulting would be costly.
• Nakayama Takuya cautioned the team against making their first game about Romance of the Three Kingdoms or Chinese wuxia.
• Fu Zan challenged the warning by pointing out that Sega was developing the Japanese-themed Demon Samurai.
• Nakayama Takuya explained that Sega's established reputation and home market gave it advantages Mercury Electronics lacked.
• Nakayama Takuya demonstrated the cultural barrier by asking Wang Jiang to explain the idiom “half a catty, eight taels” to the assistant.

Nakayama Takuya urged Fu Zan and Mercury to simplify their game and avoid copyright violations by hiring an international copyright supervisor. As the team left Sega, Fu Zan accepted the plan, but a colleague worried it would force them to create under constant legal scrutiny.

• Nakayama Takuya advised Fu Zan to focus on simpler gameplay and making Mercury financially successful before pursuing more complex ideas.
• Nakayama Takuya announced that a copyright supervisor would review every non-original asset used by Mercury and require written reasons for any veto.
• Nakayama Takuya explained that the review records would protect Mercury from lawsuits and help present it as a model enterprise to local officials.
• Fu Zan praised Nakayama Takuya’s plan and accepted his offer to resolve disputes with the supervisor through the Managing Director’s Office.
• On the way to Narita Airport, a technical backbone asked Fu Zan whether hiring a Taiwanese supervisor would mean creating games in shackles.

Fu Zan returned to China with Mercury’s team determined to adopt industrialized game-development standards and avoid copyright trouble. Meanwhile, Netscape’s browser release drove a surge of visitors to Silicon Valley Online’s Webdir, prompting Nakayama Takuya to accelerate plans for a new portal.

• Fu Zan told Mercury’s team to hire professionals and apply the industrial workflows they had learned in Japan, then flew back toward China with them.
• Nakayama Takuya received Frank’s report that Netscape had released Mosaic Netscape 0.9 Beta on October 13, 1994.
• Frank told Nakayama that Netscape’s launch had sharply increased Webdir traffic, and that Netscape had included Silicon Valley Online’s Blog in its recommended bookmarks.
• Nakayama urged Frank to ensure the company could handle the influx and asked for a simpler name for its planned portal.
• Frank said the portal demo was ready and proposed launching it before Thanksgiving, while Goldman Sachs raised its IPO valuation expectations by 20%.

Nakayama Takuya told Frank to focus Silicon Valley Online on social interaction and push Netscape to improve SSL security rather than chase browser market share. Ken Kutaragi secured Sony’s approval for PlayStation’s 39,800-yen price, but the one-year financial deadline left him weighing how to respond to Sega’s publicity.

• Nakayama Takuya told Frank that social interaction was Silicon Valley Online’s core and urged him to pressure Netscape to upgrade SSL 2.0.
• Ken Kutaragi won support from Sony’s audiovisual executives by promising to back MMCD and use DVD technology in future consoles.
• Norio Ohga tacitly approved Sony’s special financial proposal, and the group board authorized PlayStation’s 39,800-yen price for one year.
• Nobuyuki Idei warned Ken Kutaragi that Sony would cut support or consider restructuring if PlayStation failed to show strong growth and improving cash flow within twelve months.
• Nobuyuki Idei asked Ken Kutaragi how he planned to handle the press conference, and Ken examined the game lineup before tossing it aside without answering.

Ken Kutaragi and Nobuyuki Idei decided to present the PlayStation as a home entertainment device to offset its weak launch game lineup and compete with Sega. At Sony’s press conference, Kutaragi emphasized Sony’s history in the industry and began revealing the PlayStation’s powerful hardware specifications.

• Nobuyuki Idei warned Ken Kutaragi that the PlayStation’s sparse lineup could not match Sega’s, despite its low price.
• Ken Kutaragi proposed marketing the PlayStation as a Sony home entertainment terminal with CD playback, rather than focusing on it as a game console.
• Nobuyuki Idei approved the strategy, and the two agreed to get the machine into households before its software lineup caught up.
• On October 27 at the Akasaka Prince Hotel, Ken Kutaragi opened Sony’s press conference by claiming Sony had long supported the game industry with its technology.
• Ken Kutaragi revealed that the PlayStation used a 32-bit MIPS R3000A processor and a GTE capable of processing 360,000 fully texture-mapped polygons per second.

Ken Kutaragi promoted PlayStation as both a game console and a premium CD player, then revealed its 39,800-yen price and December 3, 1994 release date. The press hailed Sony’s price match and CD-player strategy, while Sato Hideki worried that coverage was making Sega’s Jupiter look like poor value.

• Ken Kutaragi presented PlayStation’s CD playback capabilities and demonstrated its games, led by Namco’s Ridge Racer.
• Ken Kutaragi announced a price of 39,800 yen and a December 3, 1994 release date.
• Nobuyuki Idei relaxed as Sony’s press conference gave the company a strong story for the next day’s headlines.
• Tokyo newspapers reported that Sony had matched Sega’s price, and shoppers debated PlayStation’s CD-player features against Jupiter’s arcade pedigree.
• Sato Hideki complained that the press had portrayed PlayStation as a game console bundled with a CD player.

Nakayama Takuya undermined Sony’s PlayStation campaign by exposing its launch lineup and questioning the value of its CD-player feature, then promoted Sega’s games and announced Jupiter’s worldwide release. The chapter left Famitsu editor Hirokazu Hamamura hinting that the date November 19 had a special advantage over Sony’s December 3 launch.

• Nakayama Takuya told Sato Hideki to seed neutral-looking criticism of Sony’s launch titles, patent fees, and supply chain through influential tech writers.
• Articles questioning the value of Sony’s CD playback feature spread through gaming media, and a store clerk used one to dissuade an office worker from buying a PlayStation.
• Sega bought advertising space for Game Gear and filled it with images of its games, while Ken Kutaragi found Sony’s mahjong-heavy launch lineup gave him little to counter with.
• Sega’s campaign shifted some purchase intentions back toward Sega, and on November 4 it announced Jupiter’s November 19 simultaneous worldwide release in a minimalist newspaper ad.
• Hirokazu Hamamura studied the announcement and asked a new editor what day came after November 19, hinting that the date held significance.

Sega prepared a globally synchronized November 19 launch to drain players’ money before Sony’s December 3 PlayStation release. Nakayama Takuya canceled Sega’s New Year promotion and reserved the holiday window for third-party games, setting up a pincer attack on Sony.

• Hirokazu Hamamura explained that Sega planned to launch worldwide on Thanksgiving week, using Black Friday to promote Jupiter in American homes.
• Ken Kutaragi learned that Sega’s China factories had built a stockpile more than five times Sony’s and ordered Sony to move up its commercials and hold large-scale trial-play events.
• Nakayama Takuya told Sato Hideki to notify third-party manufacturers that Sega’s New Year mega-promotion was canceled and that Sega would suspend major first-party releases after December 10.
• Nakayama Takuya explained that Sega’s November 19 launch would spend core players’ money before Sony’s launch, while third-party holiday releases would further squeeze PlayStation sales.

Nakayama Takuya used Sega’s Jupiter plans to draw third-party companies away from Sony before the PlayStation launch, while Sega North America prepared a $299 Game Gear campaign. The chapter left a child in Queens captivated by the ad.

• Nakayama Takuya ordered Sega to delay new Jupiter games, promote the move as a sacrifice for the industry, and send the notice to manufacturers including Namco.
• Namco, Konami, and Capcom recognized the strategy but prepared to clear their Sega-platform inventory, while other manufacturers reconsidered allocating resources to the PlayStation.
• Ken Kutaragi angrily assessed the threat to the PlayStation’s software lineup, and Nobuyuki Idei urged him to promote its CD-player features.
• Tom Kalinske and Al Nelson watched Sega’s $299 Game Gear advertisement and discussed its aggressive appeal to American buyers.
• The Game Gear ad aired across major U.S. television networks, and ten-year-old Michael Brown jumped up when it caught his attention.

Sega’s Jupiter launch at $299 drove American families toward the console and alarmed Sony, which traced its low price to production in Mexico and China. Nakayama Takuya then reviewed Silicon Valley Online’s rapid growth, ending with the internet’s chaotic ecosystem full of future opportunities.

• Michael spotted Virtua Fighter 2 advertised for $299, and Old Brown agreed to take him to look at the console.
• American parents rushed to order Jupiter after its price aired, while Ken Kutaragi and Sony executives examined Sega’s production costs and supply chain.
• Norio Ohga ordered Sony to prepare its Mexican factories and investigate production in China to reduce costs.
• Frank showed Nakayama Takuya that Netscape had reached 18% market share in two weeks and reported that Webdir needed more reviewers.
• Nakayama Takuya searched the growing directory for familiar future companies and found none, but welcomed the internet’s disorder as a sign of vitality.

Nakayama Takuya pushed Webdir to accelerate development of a full-content search engine while Sega launched a direct, game-focused campaign for Jupiter. At Sony’s PlayStation preview, Ken Kutaragi watched visitors admire the hardware but show little desire to buy it because its games felt unexciting.

• Nakayama Takuya told Frank to fast-track a web crawler and search index that would connect Webdir’s directory with a search box.
• Nakayama Takuya directed Sega’s Jupiter advertising to show real gameplay and emphasize the console’s price and next-generation games.
• Sega’s practical commercials and broad distribution helped retailers attract orders for Jupiter.
• Ken Kutaragi attended Sony’s PlayStation preview and watched visitors praise Ridge Racer’s graphics but question buying a home version of an arcade game.
• A game magazine editor mocked the PlayStation’s powerful hardware being used for Mahjong Goku: India, while the preview crowd showed little eagerness to purchase the console.

Ken Kutaragi saw that Sony's demo event had failed to persuade players to choose its console over Sega's Jupiter, while Sega struggled to meet overwhelming demand for Jupiter in North America. On November 19, Jupiter launched to crowded stores in Japan and North America, where buyers rushed to purchase the console and choose games.

• Players at Sony's demo event praised the hardware but said they would wait to compare it with Sega's Jupiter and its more appealing launch games, leaving Ken Kutaragi discouraged.
• Tom Kalinske fielded requests from retailers for more Jupiter consoles, while Al Nelson described shortages across North America and reported that Toys"R"Us had given Jupiter the display space reserved for rival consoles.
• On November 19, Japanese shoppers crowded Akihabara stores to buy Jupiter as clerks processed purchases at a frantic pace.
• North American shoppers filled carts with Jupiter consoles and groceries while waiting for new stock at Walmart and Best Buy.
• Two high school boys debated whether to buy King of Fighters 2 or Gundam Battle Operation.

Jupiter’s launch impressed players with Sonic 3D’s speed and Paper Pokémon Adventure’s inventive gameplay, while Sega’s first-day sales reached 480,000 units worldwide. Nakayama Takuya ordered factories to keep producing and rush consoles by air as supplies dwindled.

• Players split the cost of four launch games, then rushed home with their new Jupiter consoles.
• Harada Kenjiro and other players were amazed by Sonic 3D’s depth and speed, while Ogasawara Eiji’s Paper Pokémon Adventure impressed players with its paper-based mechanics.
• Sato Hideki reported first-day sales of 310,000 units in North America, 120,000 in Japan, and just over 50,000 in the United Kingdom and France.
• Sato warned Nakayama Takuya that the remaining stock would not last until Christmas at the current sales rate.
• Nakayama ordered the Mexico and Pearl River Delta factories to keep production running with triple overtime pay and air shipments.