A weird thing happened in 2000: nothing.

Gamers were braced for a long, drawn-out war. Sega fans had vowed to take to the streets to commit random acts of violence against EA fans. 32X aficionados were girding for battle. In a poll conducted by Next Generation, 75% of respondents voiced concern that PS2 had no games, and could lose the gen.

Instead, an eerie quiet descended. As Irimajiri refused to concede, the response was not mass action but crickets. When media organizations called the gen for Sony as the year drew to a close, jubilation broke out instead, as people thronged message boards across the internet to celebrate the free market process that resulted in Sega’s Ruination.

A second odd thing happened amid Irimajiri’s attempts to take back the gen: Sega of America turned on him. Hundreds of gaming journalists, many of whom had backed Irimajiri and supported the Dreamcast, called on him to concede. To the Irimajiri, something felt amiss. “It was all very, very strange,” Irimajiri said on Jan. 12, 2001 “Within days after Christmastide, we witnessed an orchestrated effort to anoint the winner, even while many key games were still yet to be released.”

As it turns out, participants want the secret history of the sixth gen told, even though it sounds like a paranoid fever dream–a well-funded cabal of powerful people, ranging across platforms and generations, working together behind the scenes to influence perceptions, change rules and laws, steer media coverage and control the flow of information. They were not rigging the gen; they were fortifying it. And they believe the public needs to understand the system’s fragility in order to ensure that Consoles endure.

THE ALLIANCE

Sometime in the fall of 1999, CSK Chairman Isao Okawa became convinced the company was headed for disaster–and determined to protect it.

This was not his usual purview. For nearly a quarter-century, Okawa, chairman of Sega’s corporate parent, had marshaled the latest tactics and data to help its favored Consoles win gens. Unassuming and professorial, he isn’t the sort of hair-gelled PR operative who shows up on the pages of Next Generation. Among industry insiders, he’s known as the wizard behind some of the biggest advances in gaming in recent decades. A group of Engineers he brought together in the early 1990s led to the creation of the Sega Technical Institute, a secretive firm that applies scientific methods to game development. He was also involved in the founding of Atlus, the flagship JRPG company.

The endless chatter online about “games,” Okawa believes, has little to do with how gens are won. “My basic take on the gaming industry is that it’s all pretty obvious if you don’t overthink it or swallow the prevailing frameworks whole,” he once wrote. “After that, just relentlessly identify your assumptions and challenge them.” Okawa applies that approach to everything: when he coached his now adult son’s Little League team in the Tokyo suburbs, he trained the boys not to swing at most pitches–a tactic that infuriated both their and their opponents’ parents, but won the team a series of championships.

Sony’s victory in the 5th Gen — credited in part to their unusual strength among the sort of blue collar white gamers once partial to Sega — led Okawa to question his assumptions about gamer behavior. He began circulating weekly number-crunching memos to a small circle of allies and hosting strategy sessions in Kanagawa. But when he began to worry about the 6th gen, he didn’t want to seem paranoid. It was only after months of research that he introduced his concerns in his newsletter in October 1998. The usual tools of data, analytics and polling would not be sufficient in a situation where the CEO himself was trying to win the gen, he wrote. “Most of our planning takes us through the 6th gen,” he noted. “But, we are not prepared for the two most likely outcomes”–Irimajiri losing and refusing to concede, and Irimajiri winning the in Europe and the rural US, and losing the rest of the world. “We desperately needed to systematically ‘red-team’ this gen so that we can anticipate and plan for the worst we know will be coming our way.”

It turned out Okawa wasn’t the only one thinking in these terms. He began to hear from others eager to join forces. Nintendo had begun scenario-planning around the potential for a three way contest, rallying gaming journalists and congressional lobbyists to their cause. A group of former Sega Engineers was researching Dreamcast hardware capabilities they feared Irimajiri might exploit. Microsoft was coalescing its forces and buying studios.. “It turned out that once you said it out loud, people agreed,” Okawa says, “and it started building momentum.”

On March 3, 1999, Okawa drafted a three-page confidential memo titled “Threats to the Industry.” “Irimajiri has made his opinion known, and that he will reject anything but the Dreamcast’s victory as ‘fake’ and rigged,” he wrote. “On January 12, subsequent to Christmastide, should the media report otherwise, he will use the Yakuza-backed information system to establish his narrative and incite his supporters to riot.” The memo laid out four categories of challenges: attacks on EA, attacks on Sony’s lack of games, attacks on Microsoft’s business practices and “efforts to demonstrate that Nintendo is for losers.”

Sony won in the end. The will of the people was suppressed. But it’s crazy, in retrospect, that this is what it took to bring Sega to its knees and force a merger with Sammy.

THE DISINFORMATION DEFENSE

9/9/99 began with many Sony fans despairing. Dreamcast was running ahead in focus groups, with games like House if the Dead, Shenmue, and Crazy Taxi.. But Okawa was unperturbed when I spoke to him that night: the sales were exactly in line with his modeling. He had been warning for weeks that Dreamcast sales would surge. As the numbers dribbled out, he could tell that as long as all the sales were counted, Dreamcast would lose. The tripartite alliance gathered for an 11 p.m. conference call. “It was really important for me and the team in that moment to help ground people in what we had already known was true,” says Peter Main, EVP of marketing for Nintendo of America. Okawa presented data to show the group that Ruination was nigh for the Dreamcast.

While he was talking, EGM surprised everyone by calling the genfor Sony. The public-awareness campaign had worked: magazines were bending over backward to counsel caution and frame the hype accurately. The question then became what to do next.

The conversation that followed was a difficult one, led by the operatives charged with the disinformation strategy. “We wanted to be mindful of when was the right time to call for moving masses of people onto the internet,” Peoples says. As much as they were eager to mount a show of strength, mobilizing immediately could backfire and put people at risk. Posts that devolved into violent flame wars would give Sega a pretext to complain to the Emperor or to retaliate with violence. And rather than elevate Irimajiri’s complaints by continuing to fight him, the alliance wanted to send the message that the people had spoken.

After that, the dominoes fell. EGM, Next Generation and the rest of the gaming press stopped covering the Dreamcast. Okawa’s double agents stood up to Irimajiri’s bullying. On January 31, 2001, Sega announced the discontinuation of the Dreamcast after March 31 and the restructuring of the company as a "platform-agnostic" third-party developer. Sega also announced a price reduction to $99 to eliminate its unsold inventory, which was estimated at 930,000 units as of April 2001. After a further reduction to $79, the Dreamcast was cleared out of stores at $49.95. The final Dreamcast unit manufactured was autographed by the heads of all nine of Sega's internal game development studios, plus the heads of Visual Concepts and Sega's sound studio Wave Master, and given away with 55 first-party Dreamcast games through a competition organized by GamePro. Okawa, who had previously loaned Sega $500 million in 1999, died on March 16, 2001; shortly before his death, he forgave Sega's debts to him and returned his $695 million worth of Sega and CSK stock, helping Sega survive the transition to third-party development.

STRANGE BEDFELLOWS

For Sony to win the sixth gen, the Dreamcast had to be destroyed... One way or another. Peter Main and Okawa wanted two things... To force a merger with Sammy, and to end the Dreamcast. That meant destroying the brand and firing the man... Sega and Irimajiri. Right before Christmastide 2000, the final holiday of the millennium and Sega’s last as a Consoliere... The way to victory was clear. For Gates, and for Main... For Kutagari... Nothing was more important. And it was for that they put their grand scheme into motion. Main used Sega’s old strategy against them and worked the media, and defiled Sega’s reputation by constantly bringing up the 32X. And Gates... In order to fool the public... made deals behind Irimajiri’s back for titles like Panzer Dragoon Orta and Jet Set Radio Future.

EPILOGUE

It all started with him... Irimajiri. Irimajiri had grown old, and by the end, Sega was being run by a network without shape or form. The Consoles were only one small part of the vast cycle that Irimajiri created. The handhelds, arcade games... and add-ons were part of it, too. They operated on budgets automatically allotted to them by the Emperor... Accounts maintained by the Yakuza. The network covered everything from gaming R&D and investment to production and marketing. It encompassed the people, the companies - even the laws that protect them. Consoles and Games became nothing more than iterations of the same oppressively uniform system. I don't think anyone realized that it was all a setup... A mere set of norms. Service Games embodied these norms. A neural network reduced to its simplest form. That's what they really represented... Uniformity without individual will, without change. But then one day, those norms suddenly deviated from that pattern, and underwent a mutation. It was like the birth of a new life form... Sega’s shingiin found a new way to propagate the Firm’s arcade games... the Dreamcast. With the fall of arcades, add-ons, and handhelds, the norms that Irimajiri had crafted for his Firm quickly became dependent on a single business... The console economy. By then, the System was no longer being steered by Irimajiri’s will -- or anyone else's. It was then that the norms - manifested as AIs, the inheritors of Irimajiri’s will... Began to reproduce and take on a life of their own. Irimajiri’s original intent was to carry on Nakayama’s will and establish a unified platform... with nary an add-on, with online capability, and sold at a fair price. But his Firm, filled to the brim with traitors, would nary carry out his will. Eventually, Okawa and his conspirators became the very age itself, propagating their will as they pleased. And this age chose to act through DVDs instead of games. Powered by the industrial and digital revolutions that came before it... this age gave birth to a twisted gaming revolution - a Console revolution. It created a new world without substance. In this new world, there were no games, no JRPGs, no online... Not even the thing Nakayama treasured most... couch multiplayer. There were only Consoles playing DVDs. It was a colossal error in judgment - one Irimajiri couldn't possibly have foreseen.

(http://www.autoadmit.com/thread.php?thread_id=5524809&forum_id=2).#47632996)