The History of The 3DO Company
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A presentation I made for a USC Computer Game class.
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The History of The 3DO Company
- 1. The History of The 3DO Company D AVID MUL L ICH NOVE MB ER 25, 20 13
- 2. Trip Hawkins • Designed his own major at Harvard University in Strategy and Applied Game Theory • Director of Strategy and Marketing at Apple Computer • Founded Electronic Arts in 1982 • Created the Producer model of game production, based on music industry producers
- 3. One Console To Rule Them All… • Problem: Electronic Arts was frustrated with having to support multiple console platforms • Solution: Develop one great platform develop a new technology, surpassing the technical capabilities of existing Nintendo and Sega consoles, which everyone would want to support
- 5. The 3D Era 4 T H G E NE R AT ION G R APHICS 5 T H G ENER AT ION G R APHICS
- 6. San Mateo Software Group • Electronic Arts’ board of directors thought console development was such a different business, it should be spun off as a separate company • Founded as SMSG in 1991, as a subsidiary of Electronic Arts • Renamed The 3DO Company, it became a separate company in 1993 in partnership with 7 companies, including • • • • • • Electronic Arts LG Matsushita (now Panasonic) AT&T MCA Time Warner
- 7. Trip Hawkins Departs EA For 3DO • Trip was looking for someone to run 3DO but was having difficulty finding the right person • He and others came to the conclusion that he was the one who had the best vision for what the company should be and that he should run it • Trip became president of 3DO, remained chairman of EA, and named Larry Probst president of EA • He kept an office at both companies and spent half time at each for the first year to 18 months • When 3DO started developing software, a conflict of interest developed, and Trip had to resign entirely from EA.
- 8. BUSINESS MODEL • 3DO collected a royalty on each console sold and $3 royalty sold by game (low compared Nintendo and Sega’s >$10 royalty) • The licensing method accounts for why the 3DO became available from no less than four separate manufacturers. • To game publishers, the low $3 royalty rate per game was a better deal than the higher royalties paid to Nintendo and Sega when making games for their consoles.
- 9. GAMES • 3DO started developing software to help kickstart hardware sales. It developed a few games to showcase what the hardware could do and then a few more in genres that weren’t be covered by their software licensees. • Some of the best-received titles were ports of arcade or PC games that other cartridge-based systems of the time were not capable of playing, such as Alone in the Dark, Myst and Star Control II.
- 10. GAMES • Since its release coincided with the arrival of the modern first-person shooter, the 3DO also had some of the earliest members of the genre as exclusives, such as Escape from Monster Manor, as well as ports of Wolfenstein 3D and Doom • Other popular titles included Total Eclipse, Jurassic Park Interactive, Gex, Crash 'n Burn, Slayer, Killing Time, The Need for Speed and Road Rash
- 11. 3DO LAUNCHES • October 4, 1993. The 3DO Multiplayer launched at an initial price of $699. (Released in Japan on March 20, 1994 and in Europe in 1994) • Panasonic produced first models in 1993. Further versions were produced in 1994 by Sanyo and GoldStar (now LG Corp) • Time Magazine 1994 Product of the Year
- 12. People Magazine’s Most Beautiful People of 1995 “IN COMPUTER-GAME CIRCLES— and on the street too—he's a knockout. With his strong bones and thick, brown hair, electronicentertainment magnate William "Trip" Hawkins III, 41, cuts a charismatic swath through Silicon Valley… Four years ago he staked part of his estimated $100 million fortune in 3DO, a Redwood City, Calif., company that he hopes will revolutionize home game playing with a new format that operates on TV sets.”
- 13. Fifth Generation Consoles 3DO ATARI JAGUAR SEGA SATURN SONY PLAYSTATION NINTENDO 64 October 1993 November 1993 May 1995 September 1995 September 1996 $699.99 $249.99 $399.99 $299.99 $199.99 2 million 250,000 9.4 million 102 million 32.9 million
- 14. PROBLEMS • Extremely High Console Price • Over-Saturated Console Market • Limited 3rd Party Developer Support • Lack of Exclusives • Stigma of Interactive Movie Style Gameplay
- 15. Flaws With The Business Model • The biggest failure was the hardware business model, which gave the licensees control of pricing, marketing and distribution of the consoles • Because of the low royalty rate, manufacturers had to make a profit on the hardware itself, whereas most major game console manufacturers, such as Sega and Sony, sold their system almost as a freebie, with expectations of making up for the loss with software sales
- 16. Software Glitches • The 3DO library also exhibited less successful aspects of home gaming at the time. • It was launched at the dawn of CD-ROM gaming, and early titles on 3 frequently attempted to use interactive movie-style gameplay featuring poor quality full-motion video and limited interactivity • Night Trap, Mad Dog McCree, and The Daedalus Encounter are some of the more notorious titles from this era
- 17. M2 • The M2 project, which began as an accelerator add-on for the 3DO,[1 was to use dual PowerPC 602 processors in addition to newer 3D and video rendering technologies , making it 2-3 times more powerful than the Nintendo 64 in terms of polygon graphics • Due to various business and technological issues, the company abandoned the console hardware business and sold the M2 technology to Matsushita in 1995 • Unwilling to compete against fellow electronics giant Sony’s PlayStation , Matsushita shortly thereafter re-branded for the kiosk market • The M2 also survived as a short-lived arcade board for Konami, and is still used today in ATM’s and Japanese coffee vending machines
- 18. Abandoning The Hardware Business • Poor console and game sales trumped the low royalty rate and proved a fatal flaw • As it became clear, that the hardware business was failing, then the company sold the hardware technology and shifted completely to software development for other platforms • The technology itself was successful for the companies that bought it. Matsushita has used the IP it bought in many products. Samsung bought our hardware division, then sold it to WebTV, who later sold it to Microsoft. Much of that technology wound up on the Xbox, and many people on the hardware team contributed to it.
- 19. Redefining The Company As changed its business to develop and publish games for other game consoles and PC, 3DO began acquiring development studios
- 20. Army Men • Combat Strategy Game • 24 titles in franchise (19 with 3DO) • 1998: Army Men • 2002: Army Men:RTS • Franchise sold to Global Star Entertainment
- 21. High Heat Baseball • Sports Strategy Game • 6 titles in franchise • 1998: High Heat Baseball 1999 • 2003: High Heat Baseball 2004 • Franchise sold to Microsoft (but no sequels made)
- 22. Might & Magic • Fantasy RPG • 8 titles in franchise (4 with 3DO) • 1998: Might & Magic VI • 2002: Might & Magic IX • Franchise sold to Ubisoft
- 23. Heroes of Might & Magic • Fantasy Strategy • 16 titles in franchise (8 with 3DO) • 1996: Heroes of Might & Magic II • 2002: Heroes of Might & Magic IV • Franchise sold to Ubisoft
- 24. Meridian 59 • First Graphic 3D MMORPG • Dec 15, 1995: Initial release by developer Archetype Interactive • June 1996: Archetype acquired by 3DO • Sep 26, 1996: Released Commercially • Named Fantasy RPG of the Year in 1996 • Aug 31, 2000: 3DO shuts down game • Re-released by Near Death Studios
- 25. Publishing Woes • There was always a lot of internal dissension about the company’s objectives and product lines • Although 3DO acquired some excellent studios, they never seemed to be able to integrate them well and to get everyone to play as a team • However, 3DO might have been a very different company if it had started from day one as a software business.
- 26. Bankruptcy • 3DO filed for Chapter 11 Bankruptcy in May 2003 • The company’s brand names and intellectual property rights were sold to Microsoft, Namco, Crave and Ubisoft • Trip Hawkins went on to create mobile game publisher Digital Chocolate in 2003 (before stepping down as CEO in 2012) and his new start-up, educational software publisher If You Can