Sonic Team
The initial team formed in 1990 and was composed of developers from Sega's Consumer Development division, including programmer Yuji Naka, artist Naoto Ohshima, and level designer Hirokazu Yasuhara. The team took the name Sonic Team in 1991 with the release of "Sonic the Hedgehog" for the Sega Genesis. The game was a major success that contributed to millions of Genesis sales. The next "Sonic" games were developed by Naka and Yasuhara in America at Sega Technical Institute, while Ohshima worked on "Sonic CD" in Japan. Naka returned to Japan in late 1994 to become the head of CS3, later renamed R&D #8. During this time, the division took on the Sonic Team brand but developed games that do not feature Sonic, such as "Nights into Dreams" (1996) and "Burning Rangers" (1998).
1993 congressional hearings on video games
During this period, two key players were Nintendo and Sega. Nintendo had been instrumental in helping to recover the North American market after the crash with the introduction of the Nintendo Entertainment System; in 1990, with its release of the Super Nintendo Entertainment System (SNES), Nintendo sales accounted for 90% of the US market. However, to avoid repeating one of the issues that caused the crash, Nintendo took care to limit and review what third-party games could be made for its platforms to avoid a glut of poor games. Sega, which had already released its Mega Drive in Japan, found their sales to be lagging behind Nintendo. In a aggressive campaign aimed at the United States market, the Mega Drive was renamed the Sega Genesis, and heavily pushed the game "Sonic the Hedgehog", with its titular character aimed to become Sega's mascot and rival that of Nintendo's Mario. Sega was less selective about what titles it wanted for the platform, allowing many more third-party games onto the system to increase its library in contrast to Nintendo's. Further, Sega used marketing language purposely aimed at Nintendo, such as "Sega does what Nintendon't". By 1992, Sega had obtained 65% of the US gaming market, overtaking Nintendo's dominant position. Subsequently a strong rivalry between Nintendo and Sega was formed, referred as the "Console Wars", which continued through the next decade and into the fifth generation of consoles, after which Sega dropped out of the hardware market and became principally a game developer and publisher, and at times working collaborative with Nintendo.