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Nintendo got their nose bloodied by Sega in the 16-bit wars but it made them better for the N64 era. They were a hipper/cooler company by '96. That and the move to 3D really I think created a great creative focus for Nintendo with games like Mario 64 and Zelda: OoT. And you had peak Rare, Rare only came onto the SNES late in the product cycle, but on the N64 they were arguably the best developer on the planet.

But all that progress was undone by the cartridge decision that took away games like FF7.