lots of reasons
1. just like in 83 too many companies entering the industry (getting a flood of consoles)
2. The gaming popluation shrinking (which was happening in Japan but fixed thanks to nintendos strategy)
3. Developers lacking in the innovation, orginality, and new IPs.
4. The rise in developement cost for games can put a strain in the develoeprs.
5. Software not selling.
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