The TurboGrafx-16.

If you mention the system to hardcore retro game fans, they'll know it -- but these days, 25 years on from its launch, it's barely even a footnote in the histories of the console wars. People still talk about the knock-down, drag-out battle between Nintendo and Sega. But NEC…

NEC made video games?

Now best known as a provider of network infrastructure, the Japanese giant was once a consumer electronics and personal computing force. While Sega and Nintendo battled for supremacy with the Genesis and the Super Nintendo, NEC provided a third option -- one that was smaller and sleeker and, in the West, almost totally ignored. By now, it's just about been forgotten.

Just about.

The TurboGrafx-16 went on sale in the U.S. in August of 1989. By the middle of 1994, it had been discontinued. I've spent weeks interviewing people who were there at the time, major players and minor, each of whom had a connection to the system.

They speak of a console that performed great in Japan. With a strong software lineup and an eye-catching design, it was assumed it would be a "slam dunk" in the West. But with a team that didn't understand the video game market, and major tactical mistakes, the TurboGrafx never even got off the ground. Its fans were passionate, but they were few in number, and Japanese management lost faith in the console, choking off support years before finally withdrawing it from sale.

This is the story of the TurboGrafx-16.

The Prehistory: "Weird, Wonderful, Wild"

Just like in the United States, Nintendo was all-conquering in Japan's 8-bit era. As with the NES, hits like Super Mario Bros. meant that its Family Computer, or Famicom, reigned. But the system had been introduced to the Japanese market in 1983. Its technology was creaky. Even as it ascended to the heights of global popularity, some developers were beginning to worry.

One company did more than worry about it. Hudson Soft, the first third party publisher for the Famicom and developer of the Family BASIC programming software and keyboard set that Nintendo released in Japan, turned its hand towards creating a new generation of NES.

Family BASIC

"They were worried that the Family Computer was starting to go a little bit stale," says Rich O'Keefe, an engineer who worked at NEC in the U.S. on the TurboGrafx's development tools and developer relations.

Hudson was an unusual, experimental company that tried a lot of different things in the 1980s. Based in Sapporo, on Japan's northernmost island of Hokkaido, it was founded by the Kudo brothers, Yuji and Hiroshi.

Despite its early successes, Hudson wasn't as buttoned-down as many Japanese companies. "These guys are not the straightforward Japanese business types as you would think," says O'Keefe, a veteran of the 1980s Japanese game industry. He traveled to Japan to pow-wow with Hudson staff on technical issues prior to the TurboGrafx's U.S. release, after joining NEC. After he quickly showed that he understood the tech, one of the Hudson founders took him fishing -- in the December snow. "Hudson's a pretty unusual company," O'Keefe observes.

"They made a few mistakes, but basically they really did things that were always different, strange, weird, wonderful, wild. It was a real game company as opposed to a marketing company," says John Greiner, Hudson Soft's first American employee.

The Family BASIC relationship is "why they thought they could get away with designing Nintendo's next video game system," O'Keefe says. Problem was, Nintendo wasn't interested in Hudson's design, and the company wasn't large enough to manufacture a console on its own -- just engineer one.

Undaunted, Hudson approached Sega and other companies with its console. It finally found a buyer in 1980s home electronics giant NEC. The two had an existing relationship, because Hudson had built productivity software for the company's PCs.

"NEC said, 'Well, we're looking for a way to get in with kids, so we'll call this thing "heart of the computer," or the PC Engine,'" says John Brandstetter, who worked on the TurboGrafx in the U.S. "I think they got talked into this deal by Hudson Soft, and then it looked like a good market to them because they saw how much money Nintendo was making," O'Keefe says.

But the PC Engine's origins made it unusual in the marketplace: designed by Hudson and manufactured and marketed by NEC, it had two masters -- and distributed decision-making. Both companies supported it as first party software studios, though Hudson was more a force for original software, while NEC frequently released ports of games from other platforms.

The Hudson-designed PC Engine CPU, a derivative of the NES' processor.

Photo credit: Wikipedia

The business relationship between the companies was unusual, too. Hudson got a royalty for every PC Engine manufactured, since it designed the CPU and GPU that powered the system; it also got a royalty on each and every game sold in the PC Engine's HuCARD cartridge format, which it also designed. The games were manufactured in Japan by Mitsubishi on behalf of Hudson, while NEC handled hardware production, and made its profits from selling systems.

A Hudson HuCARD, PC Engine's sleek cartridge format.

The size of a credit card, It was retained for the TurboGrafx-16.

Photo credit: Bryan Ochalla

In October 1987, NEC launched the PC Engine in Japan. The system was an instant success; according to Steven Kent's book The Ultimate History of Video Games, the PC Engine outsold Nintendo's Famicom in 1988. Once the company was sure it had a hit on its hands, it decided to launch the system in the U.S. But it needed a team to do it.

1988 - 1989: Moving West

It wasn't just NEC that needed to staff up to sell the PC Engine to Americans. In 1988, Hudson began to put together a team to help it market the PC Engine in the West.

In January of '88, Hudson co-founder Yuji Kudo hired John Greiner, an American who was traveling in Sapporo after college, to act as a liaison and product manager, and also recruited bilingual Japanese staff to handle other duties. The company needed English-speakers to interface with NEC, interpret for its staff, choose the games to send West, and localize them.

"They had no foreigners, they had very little English skill, so they needed somebody to help them," Greiner recalls. "Hudson created this international division because when NEC brought the system over to the United States, they needed expertise of Hudson Soft to market the software, and they needed to translate the text," says Sonoko Saito, who was hired to translate games and interpret for meetings between NEC and Hudson Soft.

The credits for the U.S. version of Ys Book I & II. In Japan, at Hudson Soft, Saito translated the text and Greiner polished it.

NEC Japan had directed its U.S. branch to sell the PC Engine, so in Chicago, NEC Technologies boss Keith Schaefer put together a launch team. Schaefer, along with Ken Wirt and Bob Faber, had joined the company after having fled Atari's home computer division. "At the time we went to NEC, we didn't have any idea about doing video game stuff anymore," Wirt says.

Under Schaefer's direction, Wirt shifted gears from NEC's PC business to become the general manager of the TurboGrafx unit, with Faber working on the project too. As Wirt has it, "it just turned out they had these three guys who knew a lot about the video game business -- they were already working for them!"

The problem: The Atari team had worked in the company's home computer division, which mostly sold hardware; its game business was based on ports of arcade games that were already successful. The management team's expertise in the home console market was very limited. "They needed the software expertise. They were not software people," Greiner remembers.

I asked Carol Balkcom about NEC's strategy for the TurboGrafx. After conversing for awhile, I began to get the idea. I asked her, "The people at the company were not generally very well versed in the game business, in other words?"

"That's a very good way to put it," she replied.

The team did, however, have a bead on consumer marketing. Wirt and his team began to put together plans to launch the PC Engine in the U.S., and that included focus testing the system and its games with U.S. consumers. "The good news was we had a product that had already been introduced in Japan. So we were able to test that in the United States," he says.

Initial results were mixed, but promising: "People liked the gameplay, it was very fast, and it was the first system with 16-bit graphics," Wirt says. "But there was not a lot of enthusiasm for the name. People thought it was confusing."

The PC Engine box. Take note of the control pad, and compare to the TurboGrafx-16 on the next page.

Photo credit: Bryan Ochalla

The company made the decision to redesign the PC Engine's casing for its introduction to the U.S. Compared to other consoles of the era, the PC Engine was tiny, thanks to its well-engineered internals and the credit card sized HuCARD format. However, "there was a feeling" that American consumers wanted something bigger -- and something more futuristic, Wirt says.

"We did a bunch of research around the name and we decided we had to change the name and the industrial design," Wirt says. The name was a simple change: "TurboGrafx" to refer to the system's speed and the strength of its visuals, which were clearer and much more colorful than earlier systems; "16" to refer to its 16-bit GPU, as "16-bit" was the keyword for that console generation. (Accessories became "Turbo" everything: TurboPad, TurboTap, TurboStick, and the HuCARD now the "TurboChip.")

"The marketing and advertising company came up with some sketches, and they conducted focus groups," says Carol Balkcom, who was part of NEC's launch team. Once the externals were designed, engineering began: "it takes time to do a redesign and a re-layout of stuff," says O'Keefe. "Plastic's not exactly a quick-turnaround item, especially if you're changing the design every so often."