History of the Nintendo Entertainment System
In the late 80s, Nintendo's dominance was threatened by newer, technologically superior consoles. 1987, NEC and Hudson Soft released the PC Engine, and a year later, Sega released the 16 bit Mega Drive. Both were introduced in North America in 1989, where they were respectively marketed as the "TurboGrafx-16" and the "Genesis." Facing new competition from the PC Engine in Japan, and the Genesis in North America, Nintendo's market share began to erode. Nintendo responded in the form of the Super Famicom ("Super Nintendo Entertainment System" in North America and Europe), the Famicom's 16-bit successor, in 1990. Although Nintendo announced their intention to continue to support the Famicom alongside their newer console, the success of the newer offering began to draw even more gamers and developers from the original NES, whose decline accelerated. However, Nintendo did continue support of the NES for about three years after the September 1991 release of the Super NES, with the NES's final first-party games being "" and "Wario's Woods".
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.