The Tragedy of 3DO

This is the story of a video game console that tried to make a big change in the market but failed, and the man who dreamed it all up.

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Episode Transcript

Speaker 1 (00:04):
Welcome to tech Stuff, a production from I Heart Radio.
Hey there, and welcome to tech Stuff. I'm your host,
Jonathan Strickland. I'm an executive producer with I Heart Radio
and I love all things tech and Back in three
a new video game console created by the founder of

(00:27):
Electronic Arts launched, and just three years later that console
would be discontinued and essentially taken off the market. It
was a massive failure. The company that made the console
would stick around a little longer, ultimately closing up shop
in two thousand three. This is the story of the

(00:48):
three d O Company and the console that wasn't meant
to be. Now, for this episode, We're going to focus
a lot early on at some prehistoric and Eastern terms
of three d OH information, because I think it's helpful
to get an understanding of the man who championed the
idea of the three d O to kind of see

(01:10):
where he was coming from, what his thought process was.
If I just focused on the console or even the
company all by itself, it would be kind of unusual, strange.
You wouldn't understand why anyone would make these decisions. So
it's helpful to have the background. Also, I just think
it's kind of an an interesting story with lots of

(01:33):
ups and downs. And that story begins with William M. Hawkins,
the third a k a. Trip Hawkins. He was born
in nineteen fifty four. He grew up in California, and
his mother, Dr. Helen Hawkins, was a producer and host
at a California public broadcast station. She was also a

(01:54):
prominent feminist and a publications director, very much a influential woman.
And his father, William Hawkins Jr. Had earned a degree
in physics before becoming a sales and marketing executive for
various companies in California, primarily those in the tech sector.
In the late fifties and then into the sixties. Trips

(02:17):
father would take a job with a company called Spectral
Dynamics Corporation, which employed another person who will be an
important figure early on for the young Trip, that being
a man named Lane Hawk. But we'll get back to him. So,
as a kid, Trip loved games, not just playing them,

(02:38):
but kind of learning how they worked right, What were
the mechanics behind the games? What was the theory behind
the games? What led to making a game a fun
playing experience? You know, it's not easy to develop an
actual game that is rewarding that balances everything out, and

(02:59):
he was really interested in that model, and when in
high school, he would attempt to make his own version
of various types of games, like he would take inspiration
from games that existed that he enjoyed and try to
make his own. He was particularly interested in games that
simulated sports. He himself loved sports, and so these games

(03:21):
kind of gave him an outlet to kind of imagine
himself being part of, like a top class athletic team.
According to later interviews, Hawkins enjoyed board games but saw
that many of his friends preferred to spend their spare
time watching stuff on television, and during a visit to
the home of his father's coworker that the aforementioned Lane Hawk,

(03:45):
he saw something that would spark his imagination for a
future industry. So Lane was fascinated with games as well,
just like young Trip Hawkins. And he was also really
into computer systems, which at the time were not a
consumer product. This is the early seventies. This was even
before there were hobbyist kits to purchase. Lane had spent

(04:08):
a lot of money, like more than five grand, which
in the nineteen seventies, wasn't even more princely some than
we would think of today, And five thousand dollars is
a lot of money, but he spent that to buy
what today would be an incredibly primitive mini computer. But
at the time it was well, it was kind of
showing its age at the time, but it was at

(04:28):
one point state of the art. It was called the
PDP eight. Now, when this computer first debuted in the
nineteen sixties, when it really was, you know, cutting edge
type of technology, it costs a whopping eighteen thousand, five
hundred dollars, but this was well beyond the heyday of
the PDP eight. And it was also a really big computer.

(04:50):
It was like the size of like a cabinet, like
a wardrobe, or a small refrigerator. It was a twelve
bit machine, meaning it could handle a range of in
jurors from zero to four thousand ninety five, or you
could do from negative two thousand forty eight to two
thousand forty seven. Zero would be taking up that pesky

(05:11):
spot in the middle. And programming for the machine was,
from what I understand anyway, not intuitive. It was not
an easy thing to program for. But Lane wanted something
that he could kind of work on in his spare
time to putter around with. It was almost like a
project car for someone who's a gear head. For Lane,
it was a PDP eight and he hooked up this

(05:34):
computer to a teletype printer. There was no display, There
was no monitor for the PDP eight, so you couldn't,
you know, look at a screen and see what you
were working on. And instead you used a teletype printer
and the printer would print out the information that you
were working on. With the computer, you would read it,
you would make changes, it would print on a new page.

(05:54):
It's a pretty painstaking process. Well, Lane created a game
he called MoU Oo, as in what cows say, at
least in the United States, and the game was pretty simple.
The game would generate a four digit number and it
would keep that number secret. So the game has a
four digit number and it was your job as the

(06:14):
player to figure out what that four digit number was,
and you would submit your own guests. You would put
in a four digit number and the computer would tell
you how many digits, if any, you got right, and
whether or not any of those digits were in the
right place. So let's say that the secret number the
computer comes up with is eight to nine five, and

(06:37):
my guess is one five nine three. The system would
tell me I got one correct digit in the right
location because I got the nine correct and it's in
the right spot. And I got a second digit correct,
but it's not in the right spot. My five is
in the wrong position of that four digit number. So

(06:58):
it's similar to a board game that would come out
a little later called Mastermind. That one uses colors, not numbers,
but it's a similar idea. Now, move did this using
moves and cows. A cow would indicate that you had
the right digit, but it was in the wrong place.
A move would indicate that you had a right digit,
but and it was in the right place. But you

(07:20):
wouldn't be told which one was which right. You wouldn't
be told which of the digits was the correct one.
You would just know, Oh, I've got, you know, two
moves and a cow, and then my fourth digit is wrong.
So I've got to start changing this out and narrowing
down what that four digit number could possibly be. And
I assume you had to do it in a certain

(07:41):
number of turns, But none of my research found anything
about that. But for our story, The important part is
when Trip Hawkins saw Lanes set up, something must have
switched on in Trip's brain. He saw the potential for
computers to bring together the world's of television and bore
to games. He imagined a world where one day people

(08:03):
could play games on computers with displays, and that's what
he wanted to do. He wanted to make games for computers.
There was no real way to do that at that time.
There was no way for the average consumer to even
get hold of a computer at that stage, but Hawkins
was certain this was where things were going to go,

(08:23):
and Lane Hawk would go on to develop some early
arcade games, but that's a story for another time. According
to Trip Hawkins himself, around nineteen seventy five, he laid
out a long term plan that would lead towards the
founding of a computer game company by the year nineteen
eighty two, but he had a lot of challenges to

(08:45):
overcome to actually make that happen. Now. He applied and
was accepted at Harvard and he was a student there
in the early nineteen seventies, and he wanted to work
in an industry that just didn't exist yet, and that
also meant he face a love challenges when it came
to his studies. It's not like there were degrees and
what he wanted to do, because the thing he wanted

(09:06):
to do wasn't a thing yet. So he started to
kind of put together his studies in a piecemeal fashion,
you know, taking classes and computer science and programming and
related topics. And at the end of his stay at
Harvard he hadn't just earned a degree, he had essentially
invented a degree in applied game theory and design. Hawkins

(09:31):
then went on to pursue postgraduate work at Stanford, where
he earned an NBA in nineteen seventy eight. By this time,
technology was slowly starting to build the foundation that Hawkins
would need to pursue his dream of creating a video
game company. UH the twenty hundred he debuted the year

(09:51):
before he got his m b A, and that took
a leading position in the new field of home video
game consoles. That same year, in nineteen seventy seven, Apple
would unveil the Apple two computer, which was the first
personal computer from Apple that took aim beyond the relatively
small harp hobbyist market. The original Apple computer was a

(10:11):
kit you might even see pictures of old Apple one
computers in wooden cabinets. That's the original Apple. But the
Apple two was the first real consumer personal computer, and
it was still too soon for Hawkins to really pursue
his plans to make a video game company. In addition,

(10:32):
while in college, Hawkins had made, marketed, and sold his
own board game after taking a loan from his father.
His father loaned him the princely some of five thousand dollars,
which again that's a lot of money. And people liked
the game that Hawkins made, but there weren't enough people
who actually bought it to make it a success. It

(10:54):
was a failure. And that failure, I think convinced Hawkins
that he really needed to be methought iCal and patient
before launching his business. It would be a bad idea
to rush into things. He had already seen what you know,
a misstep could do. It could be a very expensive mistake.
So Hawkins would conduct the first complete study of the

(11:15):
personal computer market in nine and that's back when it
was a very young field. There were a lot of
different computers out there, the Apples, the trs a D
or trash a D computer, the you know, the Tandy,
the Commodore sixty four. Those were coming out around this time,
some of them a little later, and he started to

(11:37):
get a feel for where things were headed and how
he might best be able to take part in a
technological revolution. While in school, he attended a computer fair
and he actually saw the Apple two debut in person.
He was at that computer fair and he decided that
he would apply to work for a computer company upon graduating,

(11:59):
and he did. He applied to a lot of different places,
and the one that gave him an offer that he
accepted was Apple. The company was happy to bring him
on board. He was the first MBA in the company,
which he joking Lee said, is always a scary thing.
You never want to be the first NBA in a company.

(12:19):
But he joined when there were somewhere between twenty five
and fifty people working there. Sources don't fully agree on this,
which is often the case when I researched stuff in
computer history, though Hawkins himself has said there were about
fifty employees. However, twenty five of them were primarily responsible
for physically assembling the computers, so maybe really the sources

(12:41):
kind of agree. It's just that some of the sources
ignore the assembly line workers and only focus on the
you know, the Apple management and officers. That seems a
bit elitist to me, but maybe that's what's going on anyway.
This was right as the Apple two started to get
some traction. As one of the earliest successful personal computers
that was available on the market. At Apple, Hawkins would

(13:04):
gain a lot of real world experience while taking on
an increasing amount of responsibility. He helped guide Apple's efforts
to getting computers into workplaces, and he encouraged the development
of various productivity applications like spreadsheet programs. Hawkins has said,
quote I didn't invent the spreadsheet, but I did bring
the first spreadsheet apps into Apple end quote. This would

(13:27):
allow Apple to compete in markets where previously IBM was
really the king of the castle. Four years after joining
Apple Trip, Hawkins was the director of Strategy and Marketing, Which,
you know, that's a heck of an achievement to go
to a director level position within four years, even if
you and you know, take into account the fact that
the office staff had really only numbered twenty five employees

(13:49):
when he joined the company and Apple had just held
its initial public offering, and that ended up making Hawkins
a pretty healthy amount of cash. But this means that
we were just getting up to two. And if you
remember what I said a little earlier in this episode,
that was the year that Hawkins had predicted way back

(14:11):
in n that he would launch a computer game company,
or at least that's what his plan had called for,
and other computer game companies were already getting off the
ground around this time. At home video game consoles like
the AD had spawned numerous game development companies. Hawkins made

(14:32):
his move to follow through on his plan that his
younger self had created, and he left Apple to found
his computer game company, now Trip. Hawkins says that at
the time, he thought video game developers were, on the
whole not treated so well. They were frequently treated like

(14:53):
cheap contract labor on a game by game basis, and
Hawkins aimed to create a company that turned that on
its head. And that was the birth of Electronic Arts
better known today as e A. And it was back
in two. When we come back, we'll give a super
high level overview of hawkins vision of e A and

(15:17):
how that would lead him to found another company, the
three D O Company. But first let's take a quick break. Today.
The name E A has I guess it's fair to
say a little bit of baggage along with it. The

(15:38):
company has a reputation for doing some stuff that rubs
gamers the wrong way, the big one being that it
has a history of scooping up smaller video game developers
and then kind of sapping the intellectual property those video
game developers had created and just draining it dry and

(15:58):
having the developers anguish a bit before shutting them down.
U e A has done this to companies like Origin,
which made The Wing Commander and Ultimate Series, Maxis Pandemic
Bull Rug Studios. The list is long. In two thousand
and twelve, e A even made headlines for a really
not super awesome reason. It was voted the worst company

(16:22):
in the entire United States. But back in two it
was a very different company. Hawkins said that he funded
e A out of his own pocket for the first
six months, and at the very beginning he was the
only employee and he was working out of his home
until he was able to secure some office space in California,

(16:45):
and then he started to hire on employees, and it
was only in October, months after he had started. He
got started in the spring of nineteen eighty two. So
the fall of nine two he got together with his
twelve employees. This is starting sound a little biblical, and
together they brainstormed up the name of the company Electronic Arts.

(17:06):
And Hawkins had really wanted to stress that games can
be a form of art and that video game developers
are artists and they should be recognized as such, and
Electronic Arts was born. E a's early identities centered around
compensating and crediting game developers above and beyond what the
competition offered. You know, like most video games at the time,

(17:30):
you had no idea who worked on that game. If
you found out, it was only because some industry magazine
wrote up an article about the person. Chances are you
just knew which titles went with which companies, if you
were even paying that close attention. Hawkins wanted to change that.
He wanted to say, no, you will start to recognize

(17:50):
the work of specific video game developers and the ones
that make the stuff you like, you'll know to keep
getting their stuff. That was the idea, and the company
launched early titles like Mule m u l E. It
was a combat simulation game, and Our Con, which was
one of my favorite early computer games. It was a

(18:11):
chess like game in which players would control pieces that
represented different sort of magical and mythological creatures and characters,
and you were trying to take control of a board
by controlling the space occupied by your opponent. So you
can move a piece into an opponent's square, and that

(18:31):
would initiate an arcade style dual where you would try
to beat the other player or your computer opponent in
a little arcade style game, a little shootout, and different
pieces had different abilities. Some of them were super fast
but not very powerful. Some shot very powerful beams but
moved slowly, and so on. Anyway, I'm getting off track,

(18:53):
but it was a great game. It's again one of
my favorites. Any ar Con fans out there give it
a shout out. The as Man that was one of
my favorite early computer games. Hawkins, however, his favorite games
were still sports titles. One early e A sports game
was Dr J and Larry Bird Go One on One, which,

(19:14):
if you're not you know, up on the sports ball,
it's a basketball game. Uh you know. Dr J and
Larry Bird both famous basketball players, amazing basketball players, and
Hawkins himself designed the game, or at least was very
heavily involved in the design of the game, and he
also brought both of the basketball stars into the design

(19:36):
phase and the marketing of the title, and that gave
it some prestige in the market to actually, you know,
attach real world athletes to this video game title. And
if you know your video game history, you also know
that this early period of e A coincided with a
catastrophic market event around the home video game market began

(19:59):
to wobble, and by it was in the shambles. And
I've done full episodes about the video game crash of
eight three, but the short version is that there were
a confluence of problems from a flood of bad games
by fly by Night developers. There were a series of
terrible business decisions at multiple companies. There was the overproduction

(20:21):
of titles that meant that the once lucrative industry imploded.
Then there are other elements to like licensing popular games
or or entertainment franchises that ended up being a cost
that you could never recoup that kind of thing. There
are a lot of really bad decisions and entire companies

(20:43):
disappeared within a year, and video games in general we're
seen as a failure so much so that retailers didn't
want to carry video games or video game consoles. And
it was only by kind of pivoting toward computers that
companies related to the video game space could stay afloat.
And you know, e A had primarily been developing titles

(21:05):
for computers, but it wasn't immune to this problem either.
The company shifted a little bit in its initial strategy.
You know again that was originally to promote games by
associating those games with the designers who made them. But
now e A was focusing more on promoting specific game
titles and making franchises out of them, rather than saying, oh,

(21:27):
this is a game by so and so. The company
focused exclusively on developing games for various computer platforms like
the Apple computers you know, IBM PCs, the Commodore sixty four,
and others at that time. Then Nintendo came along and
managed to do what most analysts thought was impossible. Nintendo
was able to bring consoles back from the dead. The

(21:50):
Nintendo Entertainment System here in the United States, also know
as the Famicom, became a Grand slam home run of
a hit. I thought I would use an analogy that
Trip Hawkins himself would probably appreciate, but it would take
many years for e A to start to develop games
for console systems in earnest because Hawkins was one he

(22:12):
was wary of consoles after the Crash of three and two.
He was pretty sure the PC was going to be
the future of gaming. When Sega launched the Sega Genesis
a k a. The Mega Drive in nineteen eighty nine,
at least in North America, it launched in different parts
of the world at different times. It launched in Japan earlier,
for example, but trip Hawkins would relent a bit and

(22:34):
negotiated a favorable but not perfect deal with Sega for
the e E for e A tow to publish games
on Sega's console, and at that point e A would
also develop a few games for the Nintendo Entertainment System
and got a little bit out of that niche market
of just developing computer games. Now we get to a

(22:55):
point where we start to see where the three D
O company idea starts to creep into hawkins mind. Now
to understand why Hawkins would try to get into the
console market after he had kind of grown wary of
it after the Crash of three, you have to know
a bit about the relationship between video game developers and

(23:15):
the companies that actually manufacture the hardware that those games
run on, the main the console manufacturers. In other words,
Sega in particular was kind of a thorn in the
industry side, particularly for Trip Hawkins. Sega would insist on
steep royalties. Now that meant that game publishers would have

(23:36):
to pay a certain amount of money per game sold
back to Sega in order to have the games run
on Sega machines. So let's say that you, as a consumer,
are going out to buy an e A game for
the Sega Genesis. Who is getting paid, Well, it turns
out a lot of people are getting paid. First, there's
the brick and mortar store where you bought your game,

(23:58):
because again this is back in the late eighties, there's
not really any other opportunity. But those merchants in turn
had to spend money to get the stock to sell
in the first place. So they would buy their copies
of the games that they sell to consumers like you
from e A or from a video game distributor. But

(24:18):
let's not get too complicated. E A in turn would
have to share a portion of each of those sales
two retailers back with Sega. Sega demanded high royalties, so
that meant a smaller percentage of the money would go
to e A. E A would develop the games, but
some of that money was gonna go to Sega, not

(24:41):
to e A. And Hawkins felt that there was a
big power imbalance there and he wanted a way to
address it. And he thought if he could make a
company that designed video game systems and he didn't impose
such high royalties on publishers, then creators would have a
later degree of freedom and a large incentive to develop

(25:04):
games for that system, and it would usher in a
new era of amazing games. This was keyed back into
that artist's first mentality and let's face it, a desire
to keep more of the revenue for the publisher, not
send it off to, you know, the console maker. The
three D O model was to impose a flat three

(25:24):
dollar royalty rate per games sold, which was much lower
than the royalties that were being imposed by Sega or
Nintendo at the time. Hawkins had a fairly radical idea. Now,
the standard practice for console hardware is for a single
company like Nintendo or Sega or Sony to design and

(25:45):
manufacture the systems themselves. These companies could have their own
in house development studios, but they would also negotiate deals
with external video game studios to publish titles on those consoles.
And Hawkins wanted to kind of turn that model on
its head, and his idea was to create a company
that would design the specs and architecture for a video

(26:07):
game console, but then that company would license out the
design for other manufacturers to actually make to fabricate those consoles.
So if you listen to my episode about ARM processors,
you'll recognize this model as ARM followed the same pathway.
It's something that in Vidio does with graphics cards, although

(26:28):
in Video also will manufacture cards in house in addition
to licensing out the designs to other fabricators. To focus
on three d O, Hawkins stepped down as the CEO
of e A, which would come back to haunt him later.
He would remain the chairman of the Board of Directors
for a while, but he would become the CEO of

(26:49):
three d O now and all these initialisms are really
wearing me out. Beyond the goal of creating a design
for a new console, there were a few other considerations
going in to the three d OH. But it helps
if we take a snapshot look of where the video
game console industry was in ninete. That was the year

(27:09):
of three d O s founding. So what was going
on with video game consoles in ninety one, Well, generally speaking,
the consoles of we're in what we would refer to
as the fourth generation of video game consoles. The first generation,
which started in the nineteen seventies, had largely been consoles
with games that were hardwired onto the systems, meaning you

(27:33):
couldn't switch out games or anything. The console would have
one or more games programmed on it and that was that.
That was what you were limited to. The second generation
of consoles is the one that had the Atari twenty
hundred in it. That was part of the second generation.
This was the generation that was around during the Crash
of nineteen eighty three. A lot of these consoles had,

(27:56):
you know, cartridge based system so you could switch out
games and that kind of stuff. The third generation included
the Nintendo Entertainment System, the Sega Master System, and a
few other consoles. Now keep in mind, these generations aren't
like hard and fast with solid boundaries. It's not like,
you know, after seven you go from one generation to

(28:16):
the next, they're a little more fuzzy. But while Hawkins
was working on the design of the three D O,
the leading consoles on the market included the Super Nintendo
Entertainment System which came out in nine, the Sega Genesis,
which had actually come out in nine, and the Turbo
Graphics sixteen. These were all fourth generation video game consoles. Uh.

(28:39):
There were others that were on the market as well,
they just weren't as popular. There was the Phillips c
D I UH, Sega would include the Sega c D
as a type of system, and there were a couple
of other systems that were on the horizon in nine
one when three D A was coming together. But while
the systems like the S and E S, the Genesis,
and the base Turbo Graphics six team, we're all cartridge

(29:01):
based games where the game is you know, hard coded
onto the circuit board of a video game cartridge. The
future was moving toward optical discs compact discs in the
game space. That was clearly where things were going, although
some companies cough Nintendo cough would resist that longer than others.

(29:24):
Now the standard of the time, the fourth generation consoles
was for sixteen bit graphics with processors that ranged on
the low end with eight bit CPUs. The Turbo Graphics
sixteen had an eight bit CPU, and eventually the fourth
generation would include a couple of systems that had thirty
two bit CPUs with like the sake of thirty two X.

(29:45):
Although thirty two bit systems saw limited release in the
fourth generation and limited success, they really came in on
the tail end of the fourth generation that would play
a bigger part in the fifth generation of games. It
would take a couple of years to design the three
d O and land licensing deals with manufacturers interested in
making the new console. The launch of the three d

(30:06):
O would put it in direct competition with consoles that
belonged to the fifth generation of game systems. More in
those in a minute, so the pressure was on. The
three d O would need to be better than the
existing consoles in the fourth generation or it would quickly
be left behind by the next generation of systems from
other manufacturers. So the lead designers for the three d

(30:29):
O were a couple of guys named Dave Needle and R. J. Michael,
both of whom had worked on systems or other companies together.
In fact, Needle and Michael had both worked with Commodore
to design the Amiga computer system. I've done episodes about Amiga,
and that story is pretty darn interesting. I really recommend

(30:49):
you look into it. It's a fascinating story. So I
recommend checking out those episodes. In particular, I think I
did a bang up job, if I don't mind saying so,
And you can see how that particular project came about
and how it gradually faded away. But the two had
also designed the Links handheld system for Atari. That's l
y n X because Atari was naming their systems after

(31:12):
cats for a while, and now they would be designing
the three D O specs for trip Hawkins now. According
to at least some versions of the story, the design
for the three D O really got to start in
nine nine, when Needle and Michael had sketched out their
ideas on a napkin and Trip Hawkins had known these

(31:34):
two for for years, and after learning about what they
had in mind, he decided he wanted to join forces
with them in an effort to shape this into the
three D O idea he was kind of thinking on.
So together they formed the three D O Company. The
full name for the console would become the three d

(31:55):
O Interactive Multiplayer, but a lot of people just call
it the three d O. That does make things a
little confusing because that was also the name of the
company as well, and we'll learn the company managed to
stick around a little longer than the console did, so
it gets a little, you know, fuzzy when used to
just use three d O as the name. Hawkins looked

(32:15):
to partner with different electronics manufacturers to license the design
for the actual production of the three d O Building
a hardware company would have been monumentally expensive, so he
decided that licensing it just made more sense, and he
approached in particular Panasonic, Sony and Sego. Now, Sony had

(32:36):
recently had a really bad experience with Nintendo. The two
companies were supposed to introduce a CD ROM peripheral that
was intended for the Super Nintendo system and Sony was
gonna make it, and they had gone really far in
the in the whole process, but then Nintendo backed out
of the deal. Worse than that, they backed out uh

(32:57):
in public at CS and switched to a different company.
They chose Phillips instead, and ultimately that didn't really go anywhere.
That product just kind of faded away, so it was
all for nothing. But Ken Kutaragi, a Sony executive who
was in charge of this super disc project, pivoted with
the intent to use the super disc technology as the

(33:20):
backbone of a new product from Sony, the first PlayStation prototype,
which actually was very different from the PlayStation that would
officially debut a couple of years later. But not surprisingly,
Sony declined Hawkins's offer to license the three d O
design for manufacture because they already had their PlayStation in development. Sega,

(33:42):
which if you recall, was the company that had kind
of inspired Hawkins to pursue the three d O project
in the first place, also passed on the opportunity to
make the three D O. Apparently, Sega executives felt it
would have been too expensive with too small of a
profit margin to really get into the three d OH
manufacturing game. And this is one of those cases where

(34:04):
Sega made the right call. Uh. Those often can seem
few and far between if you know a lot about
Sega's history, but this was the right decision. Panasonic, however,
was a different story. This electronics company was one of
the biggest in the world, but they didn't have a
video game console. They didn't develop those. There was an

(34:25):
entire sector of the electronics market out there that Panasonic
was not serving. So the company became the first to
license the three D O design and start on fabrication.
A little bit later, another Japanese electronics company called Sanio
would start making their own three D O consoles. They
also licensed it from three d O. Now. Snio started

(34:48):
off in n during what was effectively a purge at Panasonic.
It was a post World War two purge of the
Japanese company. For that whole story, you should listen to
my episodes about the history of Panasonic because I mentioned
it there. I just find it interesting that the first
two companies that would sign on to to fabricate three

(35:11):
D O s also shared d n A in their
corporate history. Also, while this doesn't really play into our
three D O story, I thought I would just go
ahead and mention it. Those two companies would join up
in two thousand nine when Panasonic would acquire Sanio, which
is just evidence that we live in a really weird world.
And there was a third company that would manufacture three

(35:34):
D O consoles and this one was gold Star, a
South Korean company. Gold Star is still around today, except
it's by a totally different name, and it's a name
that you would recognize. That name is LG Electronics. It
changed its name in so the company is still around,

(35:55):
but under a different name. While Panasonic, Sanio and gold
Star would produced three D O consoles, there were a
few other companies that had agreed to license the design
and build their own three D O s, but those
consoles just never materialized in the marketplace. Uh. Game Pro
magazine was a great resource for this episode when I

(36:16):
was looking into this. According to one issue, Samsung was
one of the companies that signed on to produce three
D O s, although they didn't announce any sort of
timeline for production and ultimately it didn't go anywhere. Another
Game Pro issue revealed that the electronics company Toshiba had
secured a licensing deal they were going to actually manufacture

(36:37):
a handheld or portable three D O system that also
never went anywhere. And and yet another issue of Game
Pro but they were really big into covering the development
of three D O back in the day. But I
found that A T and T apparently showed off a
prototype three d O system of their own at the

(36:58):
Consumer Electronics Show. But uh, as far as I know,
nothing beyond the prototypes that A T and T made
ever got produced. I do wonder if there are any
of those A T and T three d O s
floating around out there anyway. Gold Star, Panasonic, and Sonio
would each release a few different versions of the three

(37:19):
d O s they produced. Some were never meant to
be consumer products. They were rather designed to help game
developers who needed, you know, actual hardware to test their
games on, essentially debug kits for their games. Others would
swap out basic parts on the systems. A lot of
the early three d O s had a motorized c

(37:40):
D tray, which is both expensive and it's a point
of failure. You know, eventually the motor is going to
give out and the tray is not going to extend
or go back in, and so some of them in
the subsequent models of the three D O replace that
with a top loading c D tray, so you just
flip open the top and put a c D in

(38:00):
that way, as opposed to ejecting a tray. Now, when
we come back, I'll run down what the basic spects
were for the three d O console, what set it
apart from other consoles of that era, and why the
console ultimately failed, as well as give a brief rundown
on what happened to the company three d O, which
again hung on for a few years after the death

(38:22):
of the console. We'll get to that after this quick
break So what makes a three d O a three
d O? Let's learn about the specs of the console. Now.
For the purposes of this breakdown, I'm really just gonna

(38:45):
focus on the first consumer model of the three d
O console to hit the market. That would be the
Panasonic three d O Interactive Multiplayer f Z one. This
is the system that first debuted. In the rains of
the machine was a thirty two bit CPU that was
a risk style processor r I s C that is

(39:08):
reduced instruction set computer. Now I talked about this with
the story of ARM, but basically, it means that the
instructions that this style of CPU handles are relatively simple,
and that means that each step, each instruction is easy
to carry out and therefore it goes pretty fast. More
complicated instructions might require lots more steps, and that slows

(39:31):
things down. The clock speed, or the number of pulses
the CPU has per second to carry out instructions, was
twelve point five mega hurts. That's twelve million, five hundred
thousand pulses per second. That sounds like it's really fast,
but by comparison these days, we talked about processors that
are in the giga hurts range with more than a

(39:53):
billion pulses per second, so we've come a long way.
Paired with the CPU were a couple of video coprocessors
meant to offload some of the heavy lifting when it
comes to graphics processing. In a way, it's similar to
what graphics cards would do for PCs in the late
nineteen nineties. By handing off tasks like texture mapping to coprocessors,

(40:16):
the CPU could focus on other tasks while running games
on the three D O. It also had a math
coprocessor in addition to those to also kind of spread
out the load. Now, this was in the dark times
before h D t V was even a thing, though
Hawkins has said on occasion that the three d O
could have been upgraded to h D t V. I

(40:38):
I don't know if that's true based on what I've seen. However,
as it was sold. The three d O would generate
images that would be shown at a resolution of sixty
pixels by FO pixels you know, essentially, you know, standard definition.
It was capable of replicating sixteen point seven million colors.

(40:59):
The three d os of or did Dolby surround sound.
It had two megabytes of d RAM, one megabyte of
v RAM, and of s RAM. But what the heck
does that mean? Well, d RAM stands for dynamic RAM,
which at the time was the standard RAM of machines.
It must be continually refreshed, or rather occasionally refreshed I

(41:21):
should say, not continually occasionally refreshed by the microprocessor or
else the memory deterior rates. V RAM is video RAM,
a type of RAM that the computer can actually read
and write to simultaneously, and it was particularly useful for
handling graphics. And s RAM stands for static RAM, which

(41:41):
was a much faster form of RAM than d RAM.
But if it's better, why don't just why don't you
just use s RAM? Man? Well, it's because it was
also way more expensive, so it would drive up the
cost of productions. That's why the three d O also
had some expansion ports and had a single control part,
but it allowed for daisy chain can actions of up
to eight peripherals, so you could have multiple controllers plugged

(42:04):
into it. But it had the one port that you
used to do that with. Uh now when the system
went on sale. Oh and it also had a CD
ROM drive. I mentioned that earlier, but you know I
should throw that in there too. When I went on sale.
It did so for six hundred nine nine dollars. That
is a lot of money. If we adjust for inflation

(42:27):
in today's US dollars, it would be equivalent to about
one thousand, two hundred sixty bucks or so. So imagine
that you go into a store and you see a
video game console and its ticket prices one thousand, two
hundred sixty dollars. This is not a fully fledged computer.
It's not like a gaming rig or anything. It is
a video game console akin to something like the PlayStation.

(42:50):
By comparison, the Sega Genesis, which was again already on
the market. It had been since the late eighties that
one cost a hundred eighty nine dollars winn't launch, and
the Super Nintendo Entertainment System, which was the reigning champ
at the time, had cost one when it launched, so
the three d O cost more than both of those combined.

(43:12):
It almost cost twice as much as both of those
put together. Now, granted, the three d O was a
thirty two bit system, whereas the S and E S
and the Sega Genesis the regular Sega Genesis were sixteen
met systems, So the three d O could run more
sophisticated games with better graphics. But at that steep price point,

(43:34):
would anyone actually buy one? And why was that price
so high? Well, it goes back to the three d
O business model. See Hawkins idea was to leave the
manufacturing to other people, and then to make money through
licensing the technology to those manufacturers and later to develop
games for the system itself and to collect on royalties

(43:56):
for all the consoles and games that were sold for
the manufacturers. That meant that the three d O was
inherently more expensive than if those companies had actually developed
their own hardware in house. Manufacturers, we're going to have
to pay three d O for every console they sold
to consumers. So to make up for that cost, that

(44:18):
loss and revenue, they increased the price of the consoles,
but that ended up pricing the systems well out of
the budgets of most video game fans who are out
there now. Typically, the way video game console manufacturers make
money is through software, not hardware. Most companies will actually
sell the hardware the consoles and a loss, so the

(44:40):
retail price will actually be below what it costs to
make and ship those consoles to consumers. Now why would
you do this, Well, it's because consoles are really no
good without content to play on those consoles, so the
manufacturers would use the consoles to secure customers for stuff
like video games and other content. Microsoft and Sony and

(45:03):
Nintendo can stand to lose money on console sales if
they can make it back by selling enough first party
games or making royalties off of games that are licensed
to run on those systems. But since these manufacturers, like
Panasonic didn't own the i P, they couldn't rely on
that same model. They weren't going to make royalties off

(45:25):
of game sales the way that three d O would. Heck,
if if Panasonic had made a game for the console
that they were manufacturing, they would have to pay a
royalty to three d OH. Now, sure it was a
lower royalty than what it would be if you were
to make a game for Saga or Nintendo. But since
Panasonic was actually fabricating the three d O, that's a

(45:47):
big difference, and so the company passed the costs onto
the consumer. Understandably, that meant that the sales of the
three d O were modest at best, while the Royal
lt fees meant that, you know, developers were interested in
making games for the console. The fact that the consoles
weren't really selling well was a huge problem. Developing a

(46:10):
game is a time consuming and expensive process, and if
you see that very few people have bought the console
in the first place, well there's not a lot of
incentive for you to make games for it. I mean,
if you do spend that time and money, there's a
really good chance you won't see a return on that investment.
There's literally not enough people with the console out there
to buy enough copies of your game for you to

(46:32):
make a profit. So the three d O had sort
of defeated itself. Now this wasn't because of the hardware, though,
to be fair, other systems that could go toe to
toe with the three d O were soon on the
market afterwards, like the Sony PlayStation, But the failure was
more in the business model. Hawkins, for his part, has
said that most retailers actually marked the price down to

(46:54):
five dollars, not six, because the ret oller said, we'll
never be able to sell these things if it's that expensive,
So I guess that's something. But even so, at five
nine it was far more expensive than the consoles that
competitors on the market had. Heck, when the Sony PlayStation

(47:16):
would debut in two years after the three d O
at first hit the market, Sony priced it at two
hundred nine dollars, and like the three d O, the
PlayStation had a thirty two bit processor and had comparative
amounts of RAM. The f Z one would be the
most expensive three d O console to hit the market,

(47:36):
that was the first one, but even the less expensive
ones were still more expensive than the competition. Gold Stars
three d O would debut at three dollars. Even the
expensive f Z one would drop to four dollars later,
but the damage had been done. Adding to the enormous
problem of a high price was the fact that developing

(48:00):
games for the system was a new process. It was
a brand new set of hardware, and that meant that
game development was gonna a little more slowly than what
the three d O team had hoped, and that meant
that some titles that had been intended to be launch titles,
like a Jurassic Park game, trailed behind by several months

(48:20):
as developers tried to work out bugs in their code.
In fact, the only title that was available at launch
was a game called Crash and Burn, a futuristic racing game.
The console would fare a little bit better in Japan,
where there were six whole launch titles to go along
with it when it went on sale in n but

(48:41):
after an initial interest in three d O, that interest
in Japan died down and sales died with it. And
one bitter part of the story is that e A,
the company that Trip Hawkins had founded back in two,
ultimately bailed on three d O to develop more software
for Sony play station. Hawkins found out his old company

(49:02):
would not be developing exclusive titles for the three d
O console, but they would be doing it for the
Sony PlayStation, and that had to be a knife in
the back to see the company he had founded undercut
the next company he had found it yikes, the three
d O company was looking at a new console design

(49:23):
to try and salvage things They code named it the
M two. This was going to be the successor to
the three d O and it was intended to be
backwards compatible with the three d O systems, so that,
you know, you wouldn't totally irritate all the three d
O fans out there. And the M two was needed
because other game consoles were hitting the market that could
compete on a technical level pretty effectively with the three

(49:47):
d O and they were much cheaper, and that, unfortunately,
was just never meant to be. The company stopped development
of the M two and sold it off to Panasonic.
It's probably a good thing because they avoided the sunken
cost fallacy. By the writing was on the wall and
the three d O system was discontinued. The three d

(50:08):
O Company switched gears and instead of designing hardware specs
and then licensing those out the fabricators, the company would
focus solely on developing software for other existing consoles like
the Sega Saturn and even the Sony PlayStation, as well
as for other computer platforms. The company restructured, layoffs followed.

(50:29):
I mean, there's no need for the hardware design teams
at that point, and by the company had sold off
its hardware business division to Samsung. Hugh Martin, who had
been president while Hawkins was serving as CEO and chairman,
left the company at that time, leaving Hawkins with the
full leadership of the three D O Company. The three
DO Company would go on to develop games like the

(50:50):
Army Men franchise, the Mind and Magic Series, and High
Heat Major League Baseball, which was possibly another nod to
hawkins love of sports. But while some those franchises would
do well, ultimately the company was unable to stay in business,
and in two thousand three, ten years after they had
founded the company, Three D O had to file for

(51:11):
Chapter eleven bankruptcy protection. Its assets were sold off, with
different franchises going to other game developers, and our story
comes to an end. Well. As for Trip Hawkins, he
ran to some other challenges. In two thousand eleven, the
i r S, that is, the Internal Revenue Service in
the United States, the agency kind of in charge of

(51:31):
overseeing federal taxes. They alleged that Hawkins owed around twenty
million dollars in back taxes and that number would steadily
go up. A judge said that Hawkins quote continued to
spend money extravagantly with knowledge of his liabilities. In the quote,
essentially he was saying that Hawkins was using a personal

(51:53):
bankruptcy to kind of shield his wealth and was still
spending money like crazy on a lavish lifestyle, or, as
an old timey type person might say, he was making
hay while the sun was Shannon. He was doing this
with the help of a little accounting company called KPMG.
By the way, this sort of financial gymnastics that Hawkins

(52:15):
was accused of performing are not that dissimilar from the
allegations leveled against a certain United States president. Right now,
Hawkins would go on to pay some of those back
taxes back, but he would be embroiled in various legal
proceedings regarding the bulk of those taxes. As for Electronic
Arts or e A, it is now the second largest

(52:37):
video game publisher in the world, right behind Activision Blizzard,
another behemoth in video game publishing, and as I mentioned earlier,
EA has built up a pretty spotty reputation over the years.
Oh and as for Apple, you know, the first employer
of Trip Hawkins after he got out of college. Well,
Apple is still doing pretty good these days. I hear

(53:00):
they actually have a new phone out so good on them.
And that wraps up the tragic tale of the three
d O and the three d O Company and the
misadventures of Trip Hawkins, which I think would make a
great title of a choose your own adventure novel. What's
next for Hawkins? I don't know. He founded another company

(53:21):
called Digital Chocolate, which well maybe I'll talk about in
another episode. Uh, and you know he's still active out there.
But yeah, this was one of those stories where like
he had some great ideas and he had a real
passion for games, something that I think is is really noteworthy. Um,
and he made some great moves, but not everybody you know,

(53:41):
bats a thousand. In fact, very few people do, and
this is a reminder of that. Anyway, that wraps up
this episode. If you have suggestions for future episodes of
tech Stuff, reach out to me. You can find me
on Twitter to handle his text Stuff hs W and
I'll talk to you again really soon. Yeah. Text Stuff

(54:05):
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