Power Play (B): Sega in 16-bit Video Games

Home video-game systems were pioneered by the U.S. company Atari in the mid-1970s. After going through boom and bust in the early 1980s, the industry was resurrected in the mid-1980s by the Japanese company Nintendo. With its 8-bit video-game system, Nintendo established a dominant position in a greatly expanded home video-game market. The case focuses on the post-1987 period, when new 16-bit home video-game technology began to come on the market. First to introduce a next-generation system was the major Japanese electronics company NEC. Second out with a 16-bit system was Sega, the leader in the Japanese arcade-game business and an unsuccessful player in the 8-bit home video-game market. Nintendo itself moved more slowly in introducing a 16-bit system. The case ends with the battle between Sega and Nintendo to gain the edge in 16-bit sales.