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Virtual-On was a relative success for its time. It saw most of its popularity in Japan due to larger availability of arcades and the Saturn doing better there than anywhere else. For America however, the success was much more limited. Less arcade machines to go around and Saturn’s lukewarm success were the main reasons. The PC version, much like other Sega’s PC releases, was less emphasized over their own console’s port. This lesser success seemed to convince Sega’s European section not to release the Twin Stick controller in the region. Despite how the game is considered a sort of landmark for Sega and mecha games overall among fans, that’s all mostly in retrospect. Its impact didn’t exactly topple any towers, and ultimately met similar niche status as Sega’s other Saturn seller title, Panzer Dragoon.
The decline of arcades, and Sega’s mismanagement of their hardware side (especially during Mega Drive’s later years and Saturn overall) limited Sega’s business success overall, with Sony taking their place as Nintendo’s main rival with the PlayStation. That is not to say that Virtual-On ended up being some sort of sales catastrophe, as Japanese arcade goers took the series close to their hearts. This being Sega, they gave more emphasis on this fact rather than considering the franchise’s world wide success.
Despite Sega Model 2 being a success on its own rights, Sega was always pushing their arcade hardware further. If Nintendo has an obsession to introduce 3D to home hardware, then Sega had an obsession to push the 3D hardware at arcades. Hang-On, OutRun and Space Harrier are all examples of 80’s Sega finding ways around to introduce 3D-like effect to their games, and you could even argue that Sega’s teams became master of sprite scaling in this fashion.
Sega didn’t cut much corners with their arcade hardware, and Sega Model 3 supports this approach, as it was the most powerful arcade system board of its era. As Sega’s last piece produced by their partnership with Lockheed Martin, it contained graphical hardware designed by Real3D and Mitsubishi, which was a spin-off company from Lockheed Martin. However, Real3D only saw success with Sega, and their partnership with Intel and SGI ended up as market failure, and in the end was sold completely to Intel in 1999 due to changed arcade markets.
The reason why Mitsubishi was brought into the partnership was Real3D had a series of delays with their GPU. Originally, the Model 3 was supposed to be released in 1995, but had to be pushed back to 1996, with Yu Suzuki claiming it would deliver the best 3D graphics thus far.
Model 3, of course, ran the latest Virtua Fighter