He had had opportunities to see Sega's internal game documentation, but he had been preoccupied with developing Final Fantasy VI all year.
The cinematic storytelling of Phantasy Star III had left him deeply impressed.
This was the form of expression he had always dreamed of—the technique of telling stories through lengthy CG cutscenes and real-time rendered sequences, as if tailor-made for Final Fantasy.
"This machine... it can carry my fantasies," Hironobu Sakaguchi murmured, his fingers tapping unconsciously against his knee.
Even Shigeru Miyamoto, who had remained silent in a corner, was deep in thought.
He wasn't focused on the flashy 3D blockbusters; his mind was filled with the paper-cutout-style Pikachu.
The cleverness of using visual tricks and artistic style to compensate for hardware limitations—a technique that even the "Father of Mario" felt a long-lost sense of crisis over.
Those crazy bastards at Sega—not only had they acquired the technology, but they had also mastered Nintendo's specialty: "lateral thinking with limited resources." They had actually lowered themselves to create a game with such a strong children's-game vibe.
Takuya Nakayama, standing on stage, took in the undercurrent of anticipation surging through the audience.
He knew pressure was the best catalyst.
Only by pressuring these Third-Party Manufacturers would they be driven to squeeze every last drop of functionality from the Jupiter and produce more high-quality games.
"We've shown you the games and the console."
Nakayama raised the microphone again. The large screen went black, leaving only the black console standing alone in the spotlight.
"Now, it's time to answer the question everyone's been waiting for."
The room fell into an instant, deathly silence.
Every breath was held, whether by players eager to buy the console or rivals strategizing pricing. All eyes were fixed on that number.
Nakayama raised a single finger and gently pressed the page-turn button.
A massive number crashed onto the screen:
39,800 Japanese Yen.
The white digits appeared without any flashy effects, starkly nailed to the center of the screen.
The air in the room froze for half a second. Then, instead of applause, a boiling, roaring clamor erupted, like a kettle coming to a boil.
The flashbulbs flashed wildly, turning the dimly lit venue as bright as day.
In an era when 16-bit consoles still sold for ¥20,000 to ¥30,000, and the 3D0 dared to charge over ¥50,000, Sega had managed to price their next-generation console—a machine with performance that could crush arcade cabinets—at just under ¥40,000.
This was the "nuclear-level" pricing that would later make Sony's PlayStation famous.
Ken Kutaragi stared intently at the numbers on the screen, his hands, which had been resting on the armrest, suddenly clenched.
He knew all too well what this number meant.
This was the psychological bottom line Sony had arrived at after countless calculations, even preparing for initial losses.
But how could Sega do it?
According to industry BOM (Bill of Materials) cost estimates, the dual-speed CD-ROM drive, the custom R300OS chip, and the luxurious dedicated video memory alone pushed the hardware costs close to ¥40,000.
Add distribution fees, warehousing, and marketing, and this price was practically a charity act.
Ken Kutaragi's heart sank to his stomach.
39,800 yen. That was Sony's price for the PlayStation.
Last week, during a strategic meeting at Shinagawa Headquarters, he had nearly flipped the conference table over to defend this price.
The penny-pinching directors, who guarded their ledgers like dragons guarding treasure, had pointed fingers at him and cursed. They claimed Columbia Pictures was already a $3 billion black hole, and now the gaming division was proposing this suicidal pricing strategy—selling at a loss to gain market share. It was as if they wanted Sony to die even faster.
He had staked his entire career on this, making a military-style pledge to Oga Norio, and barely secured approval for this price.
It was a price Sony had to swallow like bitter medicine, a blood loss that would sting for years.
For every PlayStation sold, Sony would lose several thousand yen.
The gamble was that software licensing fees later on would cover this deficit.
But now, looking at Takuya Nakayama on the stage...
The young man's smile was dazzling. With one hand in his pocket and a relaxed stride, he showed no sign of the pain of sacrificing flesh and blood.
That composure didn't seem feigned at all.
"Has Takuya Nakayama lost his mind?" Kenzo Tsujimoto, standing beside Ken Kutaragi, had lost his composure. He smacked his lips. "Is he planning to sell the machines at a loss and recoup the losses through software? Can Sega's cash flow sustain this kind of burn?"
On stage, Takuya Nakayama seemed to hear the murmurs from the audience. He slipped one hand into his pocket, his smile widening.
A loss? Not a chance.
By traditional Japanese manufacturing standards, this price would indeed mean losing money on every unit sold.
But he had been planning for this for two years, extending his reach across the ocean.
Thanks to Sega's vast supply chain network in mainland China, Hong Kong, and Taiwan, the production cost of the Jupiter had been compressed to a figure that would make rivals despair.
While Sony was still haggling with Japanese suppliers over a few hundred yen difference in component prices, Sega's contract manufacturers in Shenzhen and Dongguan had already switched to three-shift, full-speed production.
Resistors, capacitors, and connectors bearing the "Made in China" label were pouring out in an endless stream, transforming into weapons that would strangle their rivals' profit margins.
The pricing decision was unanimously supported by the board.
Director Terauchi and Director Hatano, who were responsible for the production department, presented actuarial reports at the board's pricing meeting. If Sony were to mass-produce and assemble the console in Japan with similar materials, their calculations clearly showed that they would inevitably operate at a loss from the start.
This time around, Jupiter's hardware was comparable to the PlayStation's. Even better, its simpler single-CPU architecture was more cost-effective than the Saturn's complex dual-CPU design from the previous generation.
At 39,800 yen, Sega would not only avoid losses but even make a small profit on each unit. Though the margins were slim, they were still profitable.
Sony, however, could not afford to follow suit.
Takuya Nakayama gazed down at Ken Kutaragi, who sat in the front row, his face ashen.
If Sony dared to match this price, it would mean Oga Norio's books would show a deficit with every unit sold.
Given Columbia Pictures' massive losses, such a decision would be enough to give the old men on Sony's board heart attacks.
This was a blatant, open stratagem.
Just as the reporters stretched their necks, pens hovering over their notebooks, waiting to record the crucial "X Month, X Day," Takuya Nakayama on stage made an unexpected move.
He didn't press the next page on his laser pointer.
"Ladies and gentlemen."
Nakayama smiled at the audience, his expression a mixture of cunning and unwavering confidence.
"As for the release date you're all so eager to know—"
Several reporters in the front row even half-rose from their seats, ready to sprint to the nearest telephone booth to file their headlines.
Nakayama raised his index finger and gently pressed it to his lips.
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