Dreamcast didn’t kill them, it was the Mega-CD, 32X, and Saturn that killed them. Launching three architectures over three years and not giving them space and focus burned a lot of political capital with developers (including those in house) and consumers. By the time the Dreamcast was out, it was already too late.
Which is a shame. Dreamcast was a masterpiece and so ahead of its time.
… and then Yuji Naka killed one of their biggest Saturn projects by throwing a hissy fit that a Sonic game was using the NiGHTS engine.
Frankly it’s a miracle the Dreamcast worked so well and had such great games. Sega was a fucking mess throughout the 90s.
It died with Dreamcast but the console was certainly not the cause.
At least part of it was being the last CD-based console when the DVD juggernaut was around the corner. Games wouldn’t take long to outgrow CDs.
There was a plan for a DVD add on but obviously the console died before any of that stuff was released. I still think that was a minor reason for the failure though as it was more about consumer/studio trust in Sega.
Yeah, that seems to be the thesis of the video as well. I think they would have also run into problems with their expensive VMUs and the lack of a second analog stick. Even with a killer launch window, they had a steep hill to climb.