Sega CD
Released in 1988, the Genesis (known as the Mega Drive in Europe and Japan) was Sega's entry into the fourth generation of video game consoles. In mid-1990, Sega CEO Hayao Nakayama hired Tom Kalinske as CEO of Sega of America. Kalinske developed a four-point plan for sales of the Genesis: cut the console's price, develop games for the American market with a new American team, continue aggressive advertising campaigns, and ship "Sonic the Hedgehog" with the Genesis as a pack-in game. The Japanese board of directors initially disapproved of the plan, but all four points were approved by Nakayama, who told Kalinske, "I hired you to make the decisions for Europe and the Americas, so go ahead and do it." Magazines praised "Sonic" as one of the greatest games yet made, and Sega's console finally took off as customers who had been waiting for the Super Nintendo Entertainment System (SNES) decided to purchase a Genesis instead.
Sega Genesis
To compete with Nintendo, Sega was more open to new types of games than its rival, but still tightly controlled the approval process for third-party games and charged high prices for cartridge manufacturing. Technicians from American third-party video game publisher Electronic Arts (EA) reverse engineered the Genesis in 1989, following nearly one year of negotiations with Sega in which EA requested a more liberal licensing agreement than was standard in the industry before releasing its games for the system. The clean room reverse engineering was led by Steve Hayes and Jim Nitchals, lasting several months before EA secretly began game development. EA founder Trip Hawkins confronted Nakayama with this information one day prior to the 1990 Consumer Electronics Show (CES), noting that EA had the ability to run its own licensing program if Sega refused to meet its demands. Sega relented, and the next day EA's upcoming Genesis games were showcased at CES. EA signed what Hawkins described as "a very unusual and much more enlightened license agreement" with Sega in June 1990: "Among other things, we had the right to make as many titles as we wanted. We could approve our own titles ... the royalty rates were a lot more reasonable. We also had more direct control over manufacturing." After the deal was in place, EA chief creative officer Bing Gordon learned that "we hadn't figured out all the workarounds" and "Sega still had the ability to lock us out," noting "It just would have been a public relations fiasco." EA released its first two Genesis games, "Populous" and "", within the month. The first Genesis version of EA's "John Madden Football" arrived before the end of 1990, and became what Gordon called a "killer app" for the system. Taking advantage of the licensing agreement, Gordon and EA's vice president of marketing services Nancy Fong created a visual identifier for EA's Genesis cartridges: A yellow stripe on their left side added during manufacturing.