Conception The 3DO format was the brainchild of
Electronic Arts (EA) founder
Trip Hawkins; while at EA, he found himself frustrated with the limitations of developing software for different platforms that were incompatible with each other. Hawkins was inspired to create his own platform from his repeated recollection of a
cartoon he saw on a wall at his previous employer,
Apple Computer: it consisted of two
vultures on a branch, with one suggesting to the other that they kill something instead of waiting to
scavenge. Hawkins formed a unit within EA to work on the platform, but when it was spun off as
The 3DO Company on September 12, 1991, he found no one willing to oversee it; he ultimately relinquished his role as
chief executive of EA to oversee it himself while remaining at EA as its
chairman. The 3DO name itself was an abbreviation of "three-dimensional optics", though it was also a play on the words "audio" and "video". industry analysts considered them unprecedented compared to those of contemporary consoles and personal computers.
Licensing model The 3DO Company lacked the resources to manufacture consoles, and instead licensed the hardware to other companies for manufacturing. Trip Hawkins recounted that they approached every electronics manufacturer, but that their chief targets were
Sony and Matsushita (now named
Panasonic), In contrast, Matsushita agreed to partner with the company as it was seeking reassurance for its investment in
MCA Inc., which owned
Universal Pictures and had yet to see substantial success since its acquisition by Matsushita in 1990.
Toshiba, and
AT&T, who went so far as to build prototype AT&T 3DO units and display them at the January 1994
Consumer Electronics Show. Licensing to independent manufacturers made the system extremely expensive. The manufacturers had to make a profit on the hardware itself, whereas most major game console manufacturers, such as Sega and Sony, sold their systems
at a loss, with expectations of making up for the loss with software sales. The 3DO was priced at , far above competing game systems and aimed at high-end users and early adopters. Hawkins has argued that 3DO was launched at , and not "higher myths that are often reported". In a later interview, Hawkins clarified that while the
suggested retail price was , not all retailers sold the system at that price.
Competition Hawkins' belief was that the 3DO system could become a dominant standard in a similar way to that achieved by the
VHS video cassette format, with several companies being able to promote the standard effectively against individual competitors with their own technologies. It was also believed that companies would be able to more effectively compete by being able to leverage a common standard, as opposed to having to attract developers to individual formats, with Hawkins noting that this would be "tough for Atari and Sony". Indeed, Hawkins believed that the failure of NEC to establish its
TurboGrafx system, and yet being "much bigger than Sony", illustrated the difficulties faced by new entrants to the console market and thought that Sony, in following the business model of Sega and Nintendo, "would have had a better chance if it had partnered with some of the others". Meanwhile, other products were not regarded as competitive threats: the
Atari Jaguar was perceived as "primitive" and "slightly better than a 16-bit system", and the
Philips CD-i was regarded as "really obsolete by today's standards". Both 3DO and Philips, seeking to pioneer the broader concept of interactive entertainment, aimed to sell in the order of one million units during 1994 and into 1995. Hawkins claimed that the console was
HDTV-capable, and that the company could use its technology for a
set-top box. It was believed the platform would appeal to cable companies seeking to provide digital interactive services, with broadcasts being accompanied by digital information, eventually leading to the development of video-on-demand services on what was described as a "client-server interactive network", with an interactive networking trial having been announced in collaboration with
US West in Omaha, Nebraska for the autumn of 1994. The only 3DO software available at launch was the third-party game ''
Crash 'N Burn''. The system was released in Japan in March 1994 with an initial lineup of six games. The Japanese launch was moderately successful, with 70,000 units shipping to 10,000 stores.
Computer Gaming World reported in January 1994 that 3DO "is poised for an avalanche of software support to appear in the next 12 months", unlike the
Atari Jaguar and
Pioneer LaserActive. The magazine predicted that "If 3DO's licensees can get enough machines and software out in the market, this could very well become the interactive gamer's entry level machine" and possibly "the ideal plug-and-play solution for those of us who are tired of playing circuit board roulette with our personal computers". Electronic Arts promoted the console in two-page advertisements, describing it as a "technological leap" and promising "twenty new titles ... over the next twelve months". The 3DO's claim to the title of most advanced console on the market was lost with the 1994 Japanese launches of the
Sony PlayStation and
Sega Saturn. The 3DO Company responded by emphasizing their console's large existing software library, lower price (both the Panasonic and Goldstar models were by this time), and promised successor: the
M2. To assure consumers that the 3DO would still be supported, the M2 was initially announced as an
add-on for the 3DO. It was later revealed that the M2 would be an entirely separate console, albeit one with 3DO
backward compatibility. Eventually the M2 project was cancelled.
End of 3DO Unlike Panasonic, Goldstar initially produced only 3DO hardware, not software. This made it difficult to manage competitive price drops, and when the price of the Goldstar 3DO dropped to in December 1995, the company took a loss of more than on each sale. Goldstar tried switching to the usual industry model of selling hardware at a loss and profiting on software, but though a handful of Goldstar games were published for the 3DO, Goldstar's software development operation arrived too late to allow them to turn a profit on the 3DO. This lack of a profitable business model, combined with Panasonic acquiring exclusive rights to the M2 technology, were cited as the two chief reasons for Goldstar dropping support for the 3DO in early 1996. The 3DO system was eventually discontinued towards the end of 1996, with a complete shutdown of all internal hardware development and divestment of the M2 technology to
Panasonic. The 3DO Company restructured themselves around this same time, selling off their hardware division to become a multi-platform company focused on software development and online gaming. After The 3DO Company sold its "Opera" hardware to
Samsung in 1997, It competed there against Samsung's local version of the
Sega Genesis and
Hyundai's "Comboy"
Super Nintendo. The initial high price is considered to be one of the many issues that led to the 3DO's failure, along with lack of significant funding that larger companies such as Sony took advantage of. ==Licensed systems==