I really do think though looking back at it that the Sega Genesis is a lot more important than people think. Lets review:
- First system to have M-rated content and blow the doors open for a M-rated blockbuster too in Mortal Kombat. And Sega had to go before the US Senate, which wanted all violent content in video games to be censored. Think about how different console gaming would be if Sega did not carry the torch here or had bailed out and accepted what politicians were pushing for.
- Genesis popularized the sports sim genre with Madden NFL, NHL, NBA Live, etc. Before that most sports games were just generic things like Blades of Steel and Tennis and Play Action Football without actual sports athletes in the games and licensed teams/logos/etc.
- The Genesis was the first successful mass market system that had multimedia playback (not Playstation). You could play music CDs on the Sega CD years before Playstation.
- Sega was the one that started the trend to market towards teenagers/young adults before anyone else was doing it. They had to in order to compete, but basically they set forth the blue print that Sony and MS use to this day.
- The Genesis didn't look like a "toy", it looked like a piece of high end stereo equipment. So again, this is something Sega was doing years before other companies.
- Without Sega Genesis, lets be honest ... Nintendo would've had a 100% monopoly basically over home console and portable markets. There likely is no Playstation because even Sony's higher ups would've looked at that and said competing with Nintendo was impossible. It took the Genesis to cut Nintendo across the eye to show everyone else that competing against Nintendo was possible.
Genesis is the grandfather of the Playstation/XBox in a lot of ways. They were doing the "cool"/"dudebros" console years before anyone else was.
Sony had no interest in competing with Nintendo as they had no interest in making consoles. It was not because Sega decreased Nintendo's marketshare that they decided to partner with Nintendo. They made the PS because Nintendo pissed off Sony and Nintendo is well known for poorly treating publishers and retailers back then.