Every single aspect about Shenmue as been surpassed and improved upon by Yakuza.  This is a fact and i'll prove it in this video (NSFW)

Shenmue has a great storyline and great music, and it's open world design was groundbreaking for the year it released, paving the way for open world games to come shortly thereafter like GTA 3/San Andreas/Vice City. However, in the years since the release of 1 and 2, it's design grew rapidly outdated, and for the 3rd game Yu Suzuki decided to appeal to the nostalgia of its diehard fanbase by making alot of it's design outdated too, which was a poor strategy when you want to grow the appeal of the series, which needs new players to be interested in it, rather than just appealing to old fans.

At this point I don't know if Shenmue 4 will ever be made since Shenmue 3 wasn't a big seller, but if 4 is made, Yu needs a proper budget this time and needs to modernize alot of the design so that it will appeal to most modern gamers instead of appealing to only diehard fans of Shenmue. If Sega would actually get a team at Rya Ga Gotoku studio to assist Yu's indie studio with Shenmue 4, it could be truly fantastic imo.

Mainly Shenmue 3 made the series look obsolete.
Because Yakuza had a chance to develop during the current generations.

Shenmue didn't get that chance until recently with 3. But it seems to have turned out really badly. 

Yakuza is much superior to Shenmue, no doubt.

I think everyone that played Yakuza when it first launched on PS2 had figured out that it surpassed Shenmue

Was Shenmue ever actually good in the first place though? Everything I've ever read/heard about it just makes it sound terrible. It sounds like one of those movies that gets a cult following based on it being "so bad it's good".

Having never owned a Sega console, for years I wanted to try a Shenmue game and than I kind of forgot about the series. Ended up playing through all of the Yakuza games in the past 18 months and have Shenmue in my wishlist on Playstation but every time it goes on sale for $5ish I pass on it. If I ever end up signing up for Playstation Plus extra I'll try out 3 on there.

 Yakuza and Shenmue are totally different kinds of games and the comparisons people make is only surface level. Shenmue is a PC 90s stle adventure game with some action elements. Yakuza is structured more like an RPG in world and story. NPC's in Yakuza are just filler for the map. Shenmue they are all indivdual characters with routines, homes they go to and listed blood types. They even have different actions depending on player conditions. Shenmue had an innovative feature which Yakuza never used. Random weather.

They are very different in about every way. Yakuza has "random" or surprise encounters like an RPG but you beat people up. You see enemies on the overworld map. Yakuza's map functions closer in design to a PS1 RPG overworld. Enemies roam it. You only run from point a to b to progress. You have side quests. You have healing potions. Shenmue does none of this. The world is a living breathing world, all of it is used for story purposes. No healing. No side quests. Shenmue is point and click adventure games presented in a slightly different way. Like Metroid Prime is not structered like an FPS but 2D Metroid with a different perspective.

I love Yakuza and love Shenmue 1 esp. They don't aim for the same thing.

yep, he is like 20 years late =p

I had only played it when remaster launched on ps4 so yes outdated as fuck and found it boring/bad, played all 3 and they are weak in comparison to any yakuza (even shenmue 3 on ps4 vs yakuza 1 on ps2).

 yes. Original was somewhat innovative in the tools for game devlopents and many of it's mechanics. Shenmue is misunderstood as seen by the stupid comparison between two very different franchises. They seem dated now but Shenmue was impressive in many ways on launch.