SEGA's Virtual Reality - A Brief History Of Hardware and Software

SEGA has been around for almost 65 years, with it’s video game history dating back to the 1980’s with the SG-1000. Alongside their extended experience within the hardware business, they’ve attempted to push the limits of technology with add-ons that tested concepts years before they would catch on by the rest of the industry. From the SEGA Modem allowing online gaming on the SEGA Mega Drive in 1990, to SEGA Channel which allowed players to download exclusive titles for a monthly fee back in 1994.

However, some of these concepts never made it to market, the most interesting being an accessory for the Mega Drive, which tried to bring a piece of technology to consumers well before the mainstream book of the early 2010’s. One that still struggles to find wide-scale success today: VR. From hardware in the home and arcades, to revivals and original titles, I’ll be exploring (briefly) the history of SEGA and VR.

SEGA VR (1991 – 1994)

(SEGA VR IDEO Concept Design)

SEGA’s history with VR starts in 1991 with SEGA Of America riding a new high with the Mega Drive, SOA began development on a low-cost peripheral for the system to launch in October of that year. It didn’t take long to figure out the direction, the direction being Virtual Reality; with the rapid growth in computer graphics, computers were able to display large numbers of polygons in real-time; and due to the detail improving each year, there was a desire to directly interact with the worlds developers and designers were creating. SEGA was keen to address this urge to outdo their rival, Nintendo, and capture the attention of players and casuals alike.

IDEO, a design company, was brought onto the project to help create the initial concepts of the headset, with one design featuring a black and silver style heavily influenced by Sci-Fi media. Further developed concepts resulted in a black and red headset, featuring a strap over the head, a X-Men Cyclops inspired front, and over the ear headphones. SEGA would choose American screen manufacturer, Koplin Corp. to supply the headset with dual LCD screens.

A start-up company, Ono-Sendai, caught wind of SOA’s search for an affordable headset provider, and wanting to gain a high-value partnership, developed prototype sensors which could be produced at a good enough cost for consumer markets. October 1992 rolls around, and SEGA and Ono secure a demonstration on the first version of the hardware and upon its conclusion the response was overwhelmingly positive, so SEGA agreed to fund development towards a more updated version of the hardware. In an interview with SEGA-16 on 25th July 2006, Ono-Sendai engineer “Bandit” recalled –

"Sega had been talking to a couple of other groups for this project. It seems we were the only ones who could do what they needed (at the price point?) and even though we left the box with Sega, they could not figure out how we did it."

(SEGA VR IDEO Final Concept Design)

After some time, Ono would leave a second-generation prototype at SOA to provide an example of what could be expected of the final product. Eventually, Ono’s sensors provided reliable tracking functions at a low unit price of just $1, leading to an offered and signed a contract by SEGA, and the project being awarded $250,000. While the headset was said to “never crash during any demo”, complications arrived due to a lack of software, leaving multiple tests of the hardware without the appropriate software. SEGA had commissioned the development of 4 VR titles at the launch of the system, however rumours circulated about 2 extra titles.

Nuclear Rush

Nuclear Rush was the first title to be produced, planned to be the pack-in title for the hardware. The gameplay was like Atari’s Battlezone and Stellar-Fire. The player took control of a vehicle shooting enemies in an open environment and would use the headset to allow the user to look around their surroundings, which would be necessary to shootdown targets either above or below the player’s usual line of sight. It’s the only SEGA VR title preserved and as of November 2020, you can play it, and yes, with a VR headset.

Iron Hammer

Iron Hammer was a tank combat game developed by NovaLogic, a team who would later create a similar title as part of the SEGA Away Team on Saturn. The game used the VR headset like Nuclear Rush but had a smoother performance and scaling sprites like Space Harrier. The game would include 30 levels through several terrains, like grass, ice, rock and water. The game also featured a digitized speaker acting as a co-pilot, assisting the player through their travels.

Matrix Runner

Matrix Runner was a 3D polygon title where the player hacked the “Matrix” and zip across cyberspace to solve a murder. Only one screenshot exists from SOA’s 1993 Trade Catalog, with gameplay lost, but was described as inspired by Hideo Kojima’s Snatcher. The project reached two-thirds completion before SEGA killed it, and because of KCT’s contract, all code, video, test data and whatever else was relevant was destroyed. The only thing we have left is the plot.

“Play an elite super hacker in this unique cyberspace voyage. You have to explore the dark, winding databanks of the Matrix to solve the mysterious disappearance of your colleagues, knowing that you might be the next victim. In your travels, you will collide with strange semi-humans and vulture-like beings."

Outlaw Racing

The last publicly announced title was Outlaw Racing by Artech Digital. The game was a racing title where with the VR headset, you could look around your cockpit to see other racers driving past you, but due to limitations, the title struggled to keep a stable framerate, as the engine used could only run at 7 fps, and drawing the ground in 3D would drop it to nearly half, which led to cancellation. A 32X port was planned, but never got into development. Alexander G.M. Smith, the game’s lead and developer said in a interview –

“The idea was to see if the Genesis could do 3D fast enough to make a game which could use a 3D headset. That's why you can look all the way around the car's cockpit, and look up and down too. The end result wasn't fast enough to be a good game, so that's why the project was ended.”

All that’s left was some screenshots and title screens.

Two other titles were reported. The first was Chameleon, a potential follow-up to Nuclear Rush, starting preliminary work on the project in late 1993 upon the near completion of the first title. However, due to the looming concerns surrounding SEGA VR, it was cancelled. With only models revealed by Artist Rick Lucey being shown. The other title was a first-party SEGA title. Virtua Racing.

The headset would be revealed to the public at Summer CES 1993 with a price tag of $200. A working title of Virtual VR was announced, and region launches too. North America would see a release in December 1993, and the UK would follow in 1994. The event only had prop systems, highlighting the comfortability of the hardware, and if journalists wanted to play games on the system, they’d have the opportunity, privately. Upon screenings, a SEGA Spokeswoman described them as “ropey”. European outlets, apart from a few Mean Machine SEGA writers, weren’t allowed entry, with SOA claiming it was due to the system not being scheduled until 1994, basically saying that it wasn’t important to cover at the time but behind the scenes, it was because the headset was having issues converting to PAL systems.

Outside of the CES reveal, SEGA VR had some advertisements, with concept art used in the background on a September 1993 episode of Mighty Morphin Power Rangers, and a more prominent cameo in Spike Lee’s Clockers film from Sept 1995.

Despite early buzz, the looming issues mounted up, with health concerns taking hold, to the point an article by The Independent on Sunday, a British newspaper, claimed that the headset could cause eye damage for young players, a claim so damaging that SEGA lawyers were informed of the article and later got the paper to publish an apology, but damage was already done. Alongside the infamous congressional hearing on violent video games, which SEGA was already on heat for, a headset that gave players motion sickness would have given them worse press, and with a delay till August of 1994, it seemed the hardware looked less and less appealing. Eventually, the project was cancelled, with possible health concerns over motion sickness in children being the main point towards the death of the SEGA VR headset.

Even with the project going under, SEGA Of Japan was also exploring potential ways to profit of the VR craze, and unlike SOA, SOJ managed to bring their efforts to market.

Mega Visor Display (1993 – 1995)

(Mega Visor Display Promo Photo 1994)

Virtuality, a UK company established in 1985, had been very keen to explore the commercial use of VR, and had success within their 1000CS and 1000SD systems in the early 1990’s. In 1993, while SOA worked on their SEGA VR hardware, SOJ were also interested in implementing VR hardware and software into their business, and after some searching up until August, Virtuality won a £3.5 million contract to collaborate with the company. SEGA would begin development on one title, later to be called Dennou Senki Net Merc, which was developed at SEGA AM3, however SEGA AM4 and AM5 also got involved, with AM4 handling the creation of the headset, and AM5 would plan the use of the technology for an attraction for SEGA’s indoor theme park’s.

Development on software and hardware went smoothly, enough so that by July 1994, the Mega Visor Display was publicly available to the public with the VR-1 system and it’s first title, Space Mission.

Space Mission

Space Mission was a rail shooter developed by SEGA’s AM3 team which would have you sitting in a large unit with 3 other players, where you’d watch FMV cutscenes leading to gameplay. The game ran on SEGA’s Model 1 technology, meaning the environments and enemies reached the visual quality of titles like Virtua Racing. The game was very well received and led to the development of another title.

 Dennou Senki Net Merc

Developed In collaboration between AM3 and Virtuality, DSNM was a shoot-‘em-up, with the player using a large un controller to eliminate enemies. The game featured 4 stages, based on a desert, CPU, City and Space Station, with you fighting robots big and small. Due to the nature of the cabinet, a staff member would have to help players with putting on the headset, and for onlookers, included a monitor showing the player’s view.

Upon it’s showing at AOU Show 1995, it received negative reception, but despite delays, released in May of that year, as a successful location test at Ikebukuro GiGO had been the reason no worries were made according to main programmer, Andy Reece. However, due to a shortage of parts for the Model 1, it limited the production of units, leading to SEGA only shipping 2,000 VR units. The main places the unit were installed were SEGA’s own amusement centres, like O2 Park SEGA World and Osaka ATC Galbo, however managed to reach out to the UK, Korea and New Zealand.

Planet Adventure

Planet Adventure was another VR title developed by AM3, which came from a new update to the first unit at Yokohama Joypolis in September 1995. The game is said to have been another on-rail shooter, like Space Mission, however the only thing we have of the title is a screenshot showing off a robot in front of a recreation of the seating the players would be resting in.

Even with the positive reception, issues arose when SEGA tried to attempt to bring VR-1 worldwide, due to issues within SEGA by the early 2000’s. Majority of Joypolis and two SEGA World parks were closed, and as a result, no VR-1 units are in operation nowadays. SEGA, currently, still have one Mega Visor Display in their office, as well as a promotional booklet.

VR Agent & VR Distribution

(VR Agent Promotional Photo)

Despite SEGA falling back to third-party development in 2001, SEGA Amusements continued SEGA’s work within the arcades. SEGA Amusements distributed their first VR title, Ubisoft’s Virtual Rabbits in 2019, and in 2024, would also distribute Asphalt 9 Legends. However, the first title to be published by SEGA, was VR Agent.

VR Agent is a single and multiplayer first-person shooter, powered by Unreal Engine and developed by 3 Mindwave. The game had you killing terrorists in 5 levels, with the VR headset built into a gun plastic meld. You had a choice between three weapons, a pistol, shotgun and machine gun. The arcade machine could be linked to other cabinets for multiplayer, and a family friendly mode was included where the humans were replaced by robots.

While not much is known about the game’s development, the game received positive reception at several Expos and was released in November 2021.

Rise In Mainstream VR

2013 saw the release of the Oculus Rift, which finally got VR into the home at a somewhat reasonable price, but it wouldn’t be until 2016 with the release of Sony’s answer to consumer VR, the PlayStation VR would we finally see major companies release software for that platform. From Doom VFR to Resident Evil 7, it seemed that virtual reality would be a priority for companies to cater too, and SEGA was one of them. This started a new wave of VR projects by developers, either internally or through a license.

Hatsune Miku: VR Future Live (2016)

In 2016, SEGA announced what would be their first ever published VR title for consumers in the home, with Hatsune Miku: VR Future Live. A rhythm game where the player would be a member in an audience, using your glowsticks to wave in time with the rest of the crowd, cheering Miku on during her performance, and if your performance was good enough, you’d get a one-on-one encounter with Miku.

The game was aimed for Sony’s yet to be released PlayStation VR on PS4, and was arriving in October, with a playable demo at Gamescom. This came around the time that Project Diva X got a VR patch added too.

Upon release the game featured Stage 1 for £14.99, with two extra stages added in the future. Reviews were mixed, with a 61 Metacritic score and a 7.1 user score. Reviews brought up the lack of song choice and the lack of audience interaction from Miku, however the atmosphere of the concert setting was received positively.

Rez Infinite (2016)

During PlayStation Experience 2015, Enhance Experience announced Rez Infinite, a remaster of the original SEGA Dreamcast title, including brand new content. Due to SEGA licensing out their legacy IP for developers to toy with, Enhance, with key staff from the original Rez had an opportunity to revive the IP. One major addition was a VR mode utilizing PlayStationVR. The game features on-rail shooter gameplay, with a synergy between how the player interacts with the level and it’s soundtrack.

Rez Infinite would later be released for PC, allowing VR support with headsets like Valve Index, HTC Vive and more, and eventually Meta Quest. With the release of the PSVR2, support was added too, making it the most available to play. Reviews were very positive, with the VR mode being a highlight for critics, with an 89 Metacritic score and 7.4 user score.

Sonic Forces VR (Cancelled)

Okay, so this is more speculation rather than fact, but it’s something overlooked, and I want to bring this to attention. In 2017, Sonic Team released Sonic Forces, which was the first 3D Sonic game to be released on PS4 and Xbox One, and simultaneously on PC. Fans investigated the game for datamining and modding, and this was found. A title card for Sonic 2017: VR Demo Version, with a stamp exclaiming “2^nd Rom Confidential”.

It's unsure if this was a proper VR demo or related to the Virtual Reality concepts seen within the game, but if this was a full attempt to make a VR Sonic game, you must wonder what it would have looked like. I doubt the gameplay would have been the conventional Sonic style, maybe you would play an OC character shooting badnicks with Sonic characters fighting around you in a scripted sequence? If this is what is to be believed, this would have been the first ever Sonic VR experience, and most likely be exclusive to PSVR and SteamVR, however, whatever this demo was, it was later scrapped, and the only remnant is the title screen.

SEGA Mega Drive Classics (2018)

By 2016, SEGA had been releasing several roms of previous titles from under a brand of “SEGA Mega Drive Classics Hub”, featured in a big bundle for people to purchase, however SEGA decided to repackage the titles into a proper collection, and would bring it to other platforms, like PS4, Xbox One and Nintendo Switch later. D3T was brought on to take on this task, to not only port these titles, but provide new features, including achievements, Steam Workshop support, online multiplayer, and VR Support.

VR Support reached across PlayStation VR, Oculus and Vive, and took advantage of the 3D menu that allows you to reach settings, titles etc. The 3D menu is based on an old 90’s bedroom, featuring posters and comics based on SEGA titles, a CRT TV, a model of the Mega Drive and games, and the addition of changing the time of day. VR allowed you to look around and tried to emulate the experience of playing on the mega drive faithfully, with the games playing properly on the TV. It’s a neat edition, and reminds me of what would later be done with EmuVR, a emulator featuring the same features of the Classics Collection releasing last year in July.

Panzer Dragoon Voyage Record (TBA)

Panzer Dragoon Voyage Record is a VR remake of several chapters of the SEGA Saturn Panzer Dragoon games, including the first two titles and the RPG, Saga. Being developed by Wildman, Inc, it was revealed on the 25^th Anniversary of the original title on 10^th March 2020. While the game was scheduled for a 2020 Japanese Fiscal Year, but was delayed for crowdfunding until 2021, with a final date unknown.

While making appearances at some VR Gaming shows, not much was revealed, with concept art and 3D models being shown. The last major development was back in October 2021. The Panzer Dragoon Voyage Records twitter account was hijacked, and the hijacker falsely stated the game was cancelled, and that Wildman, the lead developer, had passed away. The situation was solved, and contact with the Metropolitan Police for an investigation was requested. It’s been a long time since the game’s been mentioned, and while Wildman is active on his personal account, the dedicated Panzer Dragoon VR account hasn’t, being last active in April 2021.

This is as far as I’ll go, as It’s a topic I want to talk about in the future if the opportunity arises, but for now, that’s where the story rests.

Space Channel 5 VR Kinda Funky News Flash! (2020)

Just like Panzer Dragoon Voyage Records and Rez Infinite, another team at Grounding Inc came to SEGA to acquire the license to create a title based in VR from a legacy IP, this time, being Space Channel 5. Space Channel 5 Part 3 was a constant desire for the development team, and plans for a entry on either Nintendo Wii or Xbox Kinect were considered, as they didn’t want to make the exact same title as before, but something involving a new gameplay feature, and VR was the answer.

Announced for PSVR on 15^th March 2019, the game featured two player co-op, with you dancing alongside protagonist Ulala in remade environments from the original Dreamcast game. The game was released on 10^th February 2020 for PSVR, and ports to Steam, Oculars and Vive followed. Limited Run Games also launched a physical release and collector’s edition, and later, a Miku DLC pack was released. For reception, it was mixed, as the game was criticized for it’s short length and price, with other critics praising the music, visuals and use of the controls for the PSVR version, which utilized the PlayStation Move controllers.

C-Smash VRS (2023)

Announced on the 13^{th of} February 2023, published by RapidEyeMovers and developed by Wolf & Wood, it was revealed that Cosmic Smash, a cult classic sports game developed by SEGA for arcade and Dreamcast was coming back in a VR revival for PlayStationVR2. The game has players playing a game of squash, where you hit a ball onto target tiles, clearing the room to progress. C-Smash VRS would continue to be supported with updates, and would migrate to new platforms like Meta Quest 2, 3, Pro and Pico 4. A Flatscreen version will be available on 26^th September for PS5 but keeps it’s VR roots with VR and flatscreen multiplayer, and a physical version by Limited Run is available for pre-order.

The game received positive reception, with scores mainly ranging between 70 – 80 on Metacritic, and even gained some nominations for best VR game for 2023.

Samba De Amigo: Virtual Party (2023)

Revealed at Meta Quest Gaming Showcase in June, SEGA made the surprise announcement of Samba De Amigo VR for Meta Quest. Being built from Party Central which was revealed at a Nintendo Direct earlier that year for Nintendo Switch, this was a fully developed VR title published by SEGA and developed internally by SEGA CS2, aka, Sonic Team.

Shun Nakamura, the Producer, explained why they wanted to jump to VR:

“Samba de Amigo was the first work I directed, and one that I wanted to make again if I had the chance. I was also very interested in VR hardware and wanted to challenge myself as a creator. There is a big trend in the gaming industry to revive past IPs, and I thought this might be a good opportunity, so I proposed the revival of Samba and was able to take up the challenge.”

Nakamura has mentioned the issues faced when adapting Samba to VR. How do you get the timing right for the rhythm balls flying towards you? How far forward should the ball be displayed when you're posing? How far away should the screen be displayed even when pausing? It’s things that needed to be tackled to make sure the experience in VR was positive for players. Critics agreed, and in one interview by Upload VR, said that it “greatly benefited from an impressive VR transition.”

Future Of SEGA VR

Despite major pushes into VR from many companies, with the crown jewel being Half-Life: Alyx, the technology has taken longer to reach mass success, and while some have or are coming close, like PlayStation VR or Meta Quest, it’s created a vacuum of compelling software. SEGA’s main successes in VR have come from providing the license of legacy IP to passionate developers, like Rez Infinite or C-Smash VRS, however these titles, while solid, don’t reach a larger audience that it desperately needs, and SEGA themselves have been slow to adapt, with only two titles being produced directly from the company since the introduction of consumer affordable hardware hit the market.

SEGA are aware of the challenges that come with VR development, and that it’s these hurdles that are stopping a consistent growth of support by major publishers. In a 24^th April 2023 interview by The Worldfolio, SEGA Sammy CEO, Haruki Satomi, was asked about VR as a future market, and if he believed In VR personally. He said:

“VR headsets are still too heavy for a lot of people, and currently, the most suitable platform for them is arcades and not home use. VR still makes people nauseous or tired after playing for an hour, so I believe that advances in technology will help us solve those issues sooner than later. The new Google Glass is quite light, but the best VR headgear is still a bit heavy. Hopefully, the devices will get lighter, like sunglasses. That would make it easy to switch from VR to AR, or mixed reality. I think then everybody will want to play VR games. However, it is still too soon for most. It is mainly early adopters or innovators that are enthusiastic about VR, but it is not yet popular in mass markets.”

Speculation.

SEGA does believe in VR. It’s very clear. But the risk of releasing high-profile software on a platform that many are physically unable to cope with is a tough sell. Valve only managed to make a title like HL:A due to them being a private company and their immense revenue streams, the cost doesn’t matter much, but to other typical companies, it absolutely would, and what we see are VR modes for titles that are made for flatscreen displayers, rather than exclusive, built for VR experiences. Indie games have supported that market and ran with it, getting the most out of VR players with games like Gorilla Tag and Beat Saber.

Is it possible for the hurdles to be jumped over? Can VR really become mainstream? Motion Sickness, one of two main obstacles to VR does have remedies, from medication, gum chewing and extra devices to mitigate symptoms, however for a normal consumer who expects it to work, in-game settings need to be improved to accommodate for more players. Movement options are a must, from teleporting, to analogue control and camera tracking movement, options help the player customize and tailor the gameplay to their liking. Built-in warnings or improved hardware compatibility would also aid in combating motion sickness.

Another hurdle is price. When PlayStation VR was released, it cost a total of £349. While for many enthusiasts and hardcore gamers it’s a normal, satisfactory price, for many casual consumers though, might not be cheap enough to dip into their pockets. Especially with rising costs on important necessities, current prices for not just VR but for high-end gaming seems less and less feasible, especially when trying to capture an audience to an even still infant market.

Despite this, I do believe SEGA will continue with VR development. Even with current lingering issues, VR still has a large enough userbase to chase. Meta Quest 2 as of March 2023 sold 20 million units, and especially for a niche that Is VR, it’s healthy.

Currently we don’t know what the future of SEGA and VR development will lead to, but hopefully, with VR becoming cheaper and more available, the future, while unknown, looks to be as bright as it can be.

-------------------------------- BUT --------------------------------

All this was written months ago, and in the recent weeks, SEGA Amusements have announced a brand new VR arcade title.

Developed by Kaizen Entertainment called Alpha Ops VR Strike, a on-rails first person shooter fighting lizard robots being built in Unreal Engine 5. Here's the fill description.

"Introducing Alpha Ops VR Strike, SEGA Amusement’s brand-new attendant-free, coin-operated motion VR game that takes the arcade shooting experience to a whole new level.

Players are placed right in the action as they ride ‘shotgun’ in an armoured vehicle with their fellow ‘Alpha Ops squad’. Using different weapons to attack the enemy, players must break through the pursuit circle and eliminate the powerful boss, all while driving through high-intensity locations. Three visually stunning environments are brought to life in exquisite detail using the power of Unreal Engine 5, immersing players in the action. The cabinet captures attention with its unique ‘armoured vehicle’ design, motion base, and captivating LED lighting. Featuring two massive 86” 4K displays, it not only creates an unparalleled experience for players but also encourages spectators to watch the action unfold as players enjoy the immersive VR experience."

It's great to see SEGA continuing to have an interest in VR, however, the question now rests on if their still willing to push that interest into the console and PC landscape. The company holds many IP that could benefit from the experience of VR. Titles like The House Of The Dead, After Burner or any SEGA Racing title could be given a whole new level of immersion just from that single change. We could also see brand new IP be birthed from that change. It's something worth looking into in the future, and a keen interest to keep up with.

Regardless, the future of SEGA and VR seems good and healthy, and hopefully will grow as the medium of VR grows. Thanks for reading, and take care!

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Big thanks to Kat for proof-reading the script and providing feedback!

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