3DO sounded like a great premise. Several great minds came together to design a game console that they could license to any consumer electronics manufacturer who wanted to make it. It could have been the VHS or the IBM PC clone of the video game console market. But it didn’t catch on and 3DO exited the game console market June 24, 1997.
3DO’s impeccable pedigree
The brainchild of Trip Hawkins, the founder of Electronic Arts, he joined up with three industry veterans, RJ Mical, Dave Morse, and Dave Needle, to design a game console. Needle and Mical had been key members of the Amiga design team and the Atari Lynx design team. Morse had been their boss. Take a dream team that was always years ahead of their time but hamstrung by working for companies with no funding and poor marketing, and give them funding and marketing and use the VHS business model, and they’d take over the world, right?
3DO’s objective was to create a next-generation, CD-based video game/entertainment standard manufactured by various partners and licensees. 3DO would collect a royalty on each console sold and on each game manufactured. And to provide incentive to developers, the $3 royalty rate per game was much lower than Sega or Nintendo demanded.
3DO launched the product in North America on October 4, 1993. Its Japan launch followed March 20, 1994, and Europe on June 10, 1994. It did attract a library of 246 officially released games, which sounds pretty good unless I mention its leading competitor had 4,074 officially released games.
3DO Specifications
The 3DO looked like a next-generation Amiga on paper. It contained a 32-bit ARM60 RISC CPU running at 12.55 MHz, a custom graphics chip capable of 320×240 resolution at color depths of either 16 or 24 bits, and a Panasonic FZ-1 Digital Sound Processor. Essentially they took an inexpensive off-the shelf RISC CPU and an off-the-shelf DSP and put their magic in the custom graphics chip, much like Amiga was expected to do after the Motorola 68000 line ran its course.
The major weakness with the hardware was that it was designed for 2D and multimedia. With 3D games looming on the horizon, this ended up being a problem.
The problem with licensing to hardware manufacturers
In theory, licensing the hardware to several manufacturers would create competition, driving costs down. That’s what happened with PC clones and VHS VCRs. But the problem was a quirk in the game console market. By the 1990s, Sega, Nintendo, and Sony were perfectly happy selling their consoles at a loss. The games themselves were profitable enough to more than make up for the money they lost on the hardware.
In the case of 3DO, the hardware makers had to make a profit on the hardware, since they weren’t making money off the software sales. Originally, 3DO consoles retailed for $699. While the price did drop to $399, that still looked bad sitting next to Sony’s launch price of $299 for the original Playstation. Analysts saw this as a problem from the start. In the June 21, 1993 issue of Computerworld, analyst Bart Mallio called the 3DO too expensive for a video game and too limited to be a computer.
So even though 3DO did promote the console, including getting Time magazine to name it its 1993 product of the year, its high price limited it to less than 10 percent of the U.S. video game market. It sold somewhere between 1.38 and 2 million units in its lifetime, and its bestselling game, Gex, sold 1 million units. That paled compared to the Playstation’s 102 million units sold worldwide.
That’s why 3DO pulled the plug on June 24, 1997.
3DO’s legacy
3DO’s model sounded like a good idea, and someone would have tried it if 3DO hadn’t. Licensing technology to cloners was something everyone considered a panacea in the 1990s. If only I had a nickel for every time I heard someone say Commodore should have let people clone the Amiga. I’d be rich. The model of the IBM PC clone and the VHS VCR was fresh in everyone’s mind in 1993. Even Apple tried it for about two years, licensing the Mac to a total of 33 other companies, notably Power Computing, Motorola, Umax, and Radius.
But for video games, the model of first-party development and charging higher royalties to subsidize hardware sales won out. And since then we’ve seen the console makers buy up the larger, more successful independent publishers. Nintendo buying Rare was one notable example. But the biggest, most extreme example was Microsoft’s purchase of gaming giant Activision.
David Farquhar is a computer security professional, entrepreneur, and author. He has written professionally about computers since 1991, so he was writing about retro computers when they were still new. He has been working in IT professionally since 1994 and has specialized in vulnerability management since 2013. He holds Security+ and CISSP certifications. Today he blogs five times a week, mostly about retro computers and retro gaming covering the time period from 1975 to 2000.
why’d did Sega Saturn and Turbo Graphics fail ?
The early 90s was a great time of innovation and competition in the console space. But the 3DO was just way too expensive in a price-conscious market (which, to answer simultaneously Neo’s point, was also one key reason the Sega Saturn failed in the US – the PlayStation famously undercut its launch price in a dramatic CES announcement). We now seem to be reaching a point where the RAM crisis is causing today’s consoles to reach price levels beyond the reach of consumers.