Sega started off on the wrong foot when it launched its 128-bit Dreamcast game console in Japan Nov. 27, 1999, and has been unable to regain its balance ever since.

Due to chip shortages, Sega only managed to ship 150,000 consoles at the launch. Though Sega executives hoped to sell well over 1 million consoles by the end of the year, they had barely reached 900,000 by February. In March, PlayStation 2 launched, and the market became Sony's.

The U.S. launch of Dreamcast had more impact. Sega sold more than 1 million consoles at its launch, but sales still turned soft. By January, U.S. Dreamcast sales seemed to be in the same doldrums as sales in Japan.