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Onimusha12 said:

What is your list of the worst mistakes made in gaming? So many to choose from, but what is your list?

Mine is...

1. Virtual Boy
2. Nintendo saying "screw off" to third party developers with the N64.
3. Sega abandoning Saturn third party support in favor of forcing the Dreamcast.
4. Capcom disolving Clover Studios
5. Blu-Ray as the standard for the PS3
6. UMD

I know, not much of a list, but maybe you can do me one better.

1. Sega abandoned the Saturn because gamers were abandoning the Saturn. This was because they screwed up in prematurely abandonig the Genesis (and releasing various add ons for that system) which undermined consumer confidence. With the Genesis, Sega had pulled even, if not ahead of, Nintendo, and they flushed it all away. So the #1 for me has to be the abandonment of the Genesis, which led to two commercial failures and Sega's exit from gaming.

2. Nintendo didn't say "screw off" to third party developers - that would imply that they chased them away deliberately. They did alienate them, but that wouldn't have much mattered had they remained the top of the heap. The real problem was that it pulled out of it's development deal for a CD based console with Sony, which led to the creation of the PS1 (giving 3Ps the opportunity to abandon Nintendo) and thus the PS2 and 10 years of Nintendo as being the "also ran" console maker. If Nintendo had failed with the Wii, this would be #1, but since they survived and Sega didn't, Sega's blunder gets the pole position.

3. BR alone wasn't a mistake, as that capability ensured that format's success. But the entire design and marketing of the PS3, the overall arrogance of Sony, was a crippling blow to the PS3 which took a year to fix and likely will relegate them to third place for at least the rest of the year.

Compared to these, Virtual Boy is a minor issue, causing no real long term damage to the Nintendo brand (and not nearly as bad as CD-i or 3DO), and the UMD was a very minor misstep as the PSP is still going strong