Michael Girdley explains how Sega dominated in 1995 but imploded at E3 when CEO Tom Kalinske rushed the Saturn's launch at $399. Sony's Steve Reyes announced the PlayStation at $299, the crowd erupted, and PlayStation's sales quickly overtook Sega's five-month head start.
In 1995, Sega Corporation was absolutely winning and dominating. But when they went up on the E3 stage that year, uh, 4 little words would, uh, basically destroy their entire company. Those 4 words were $299. Sega's CEO was a man named Tom Kalinske. Uh, he had just done a surprise announcement of their console, the, uh, Genesis, 5 months early and told everybody it was already available in stores for $399. And Kalinske and the whole team thought they, uh, had a head start, uh, against future rivals by getting to market sooner. But behind this, Tom reported to folks back in Japan, and his bosses back there had forced him to launch the product before he thought it was ready. Major retailers like KB Toys were furious they'd been blindsided. Many refused to ever even carry the console. Then Sony's Steve Reyes went on the stage and he uttered one phrase. $299. $299. And the entire crowd went wild about the new PlayStation. Within 2 days of the PlayStation's launch, Sony would outsell the entirety of the 5-month head start that the Sega Saturn had. Kalinske would later describe this exact moment as the reason he would eventually leave Sega. And there's more to the story than that. You can catch the whole thing in the long video that I've linked below.
