The 32X was too weak, it needed to be able to throw around a good amount of textured polygons to have a chance, and the UK wasn't as budget minded during that era anymore, and anyway the money issue always seemed more focussed around hatred for the "razor and blades"? (I think you call it) method, we wasn't so bothered about shelling out for consoles or computers as much as paying more for the software than what it was actually worth. Wouldn't have 32X games been more expensive due to being on cartridge format?
Also this may be my bias speakingbut in my opinion if the UK had still been very budget conscious during that mid 90s period, then the far more logical choice for people to buy would've been the 3DO anyway as around the release of the PS1 the 3DO price had dropped to £199 with a game whilst the PS1 was £299 without a game and the Saturn was £399 without a game.
The 3DO had a small but solid back catalogue of games by then, its hardware could handle a very respectable amount of textured polygons and it was £100 cheaper than its nearest competitor
Lets be honest here, the PS1 was like the deal of the century and most people could see this
Sony had obviously tirelessly prepared for their entrance into the console market with masses of research, they created a console that could do everything needed of it for the time whilst being as cheap as possible to manufacture and easy for 3rd parties to develop games for, not only this but they sold the console at a loss to themselves that only they were big enough as a company to afford and paid out for a huge advertising campaign.
But saying that, over here if Sega had actually managed to do just one thing right their well loved name brand alone could've still kept them competing with Sony.
but they didn't, they made a console which was expensive to manufacture so they couldn't compete with Sony on price, a console that was difficult to make games for so they couldn't compete with 3rd party support/numbers of games, and a console which they themselves didn't support properly with their own well known licenses.
Sony had done masses of market research and Sega had been caught with their pants down, from what I've read in my magazines from the time Sega put very little effort into designing the Saturn at all, they had built it with the understanding that they would have the 5th generation video game market to themselves for a few years before Nintendo came out with their machine, only to panic when Sony announced they were entering the competition and were forced to improve the Saturn design at a late stage in development.
I think the Saturn was perfect for Japan just the way it was, they seemed much more interested in 2D then the rest of the world at that time and its 3D capabilities were good enough.
From what I understand the Saturn competed toe to toe with the PS1 in Japan until Final Fantasy 7 was released.
Securing one of the major RPGs was probably all Sega really needed to do to push them ahead of PS1 in Japan, a Final Fantasy or Dragon Quest was all they really needed for that territory.


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