I was too young to care about the business and market side of things back then, but in hindsight I really don't understand what killed it.

It was reasonably priced ($250 I think) 

It had a solid Launch with Sould Calibur (the second highest rated game ever on gamerankings), and Sonic adventure (flawed but a solid launch title.)

It was first out of the gate giving it a good headstart

It had the first real online system for a console that wouldn't be rivaled until the X-box came on the scene

It had good continued support with many high calibur games, including many awesome online games such as Quake 3, unreal tournament (both alowed play against PC gamers as well) Phantasy Star online, Alien Front Online, Chu Chu rocket, and many more

 From a reasonable standpoint I don't see why it didn't succeed other than possibly the sega name. What was the reason the Dreamcast failed so terribly from a market standpoint?

Sega was broke. EA turned its back on Dreamcast.

Well first of all it could have easily sold double or triple what it did if Sega did not stop supporting it so quickly and stuck it out for 4 or 5 years. They just ran out of money and couldn't afford to make it or any games. The dreamcast should have been more successful, it deserved to, but it was simply overshadowed by the PS2. The online was great, but at the same time it was too early for it to have a significant impact. No matter what Sega did at that time the dreamcast was just doomed.
Seriously it had some of the best games in such a short period of time, it's really a shame.

Playstation brand coupled with sega's financial troubles killed it.

Here's a TV special on the History of Dreamcast.  Everything you need to know about it is here.

It was released to close to Sega Saturn. Sega became known for not supporting there devices( sega cd, 32x, and some other drive).

it was released 4 years after the saturn which was very dead by the time the dreamcast came out.  Saturn never had any life in NA or Europe, it wasn't even released in some european countries.  It did pretty well in Japan, that was it, and even in Japan it was dead.  .

Sega actually did pretty well at supporting Saturn even though it was basically dead, games like Panzer Dragoon Saga, Shining Force 3, and Burning Rangers come to mind. 

I believe there are some great comments on this very topic in this thread:

http://www.vgchartz.com/forum/thread.php?id=2521 

Use the search, Luke... uh vagabond.  Use the search! ;) 

I'm pretty sure the wii's successor will be out in 2011-2012.  (as will microsofts new system) 

Dreamcast was a lot more fun than I have now with my Wii :(.

When I was in China I found out that many gamers had a DC over there, I was surprised because it is hard to find someone who haves a DC :(.