What I don't understand is why they made the 32x at all. Sega should have instead delayed the Sega CD, made it as powerful as the Saturn (except without the excessive complexity), and then release it sometime around 1994-1995. Then cancel the Saturn entirely and tout the Sega CD as a next gen addon for your current console. Sell the addon for $199. Then maybe they would have stood a chance against the Playstation.
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