Dreamcast: Huge sales but plagued by disc problems

Despite celebrating a $98m first-day sales record with its Dreamcast next-generation game platform, Sega of America had major headaches on Friday: Disc manufacturing problems were freezing up some games, frustrating consumers.

Sega confirmed that an initial run of its proprietary GD-ROM discs pressed at one of its four stamping plants had defects in them. According to the company, the affected discs include Sega's Web browser disc shipped with the Dreamcast and two game discs -- Blue Stinger and Sonic Adventure. "We have been able to track the faulty software," said Jennifer Walker, a spokeswoman for Sega of America, adding that less than 1 percent of the discs manufactured so far have problems.

The returns threatened to turn the enthusiastic wave that the Dreamcast is riding after launch into a ripple. On Friday, Sega announced that it had sold $98m (£58m) worth of Dreamcast hardware, peripherals and software in a 24-hour period. That amount doubled Sega's projected revenues for the first day of sales. By way of comparison, "Star Wars: Episode One -- The Phantom Menace" brought in $28.54m in its first day at the box office.

For that reason, Sega is taking the incident seriously, said Walker. "Consumers can swap out any problem discs with retailers," she said. The Software store in California that hosted one of the four nationwide launch parties -- generating $167,000 in revenue on Thursday -- had customers flocking back to return games, said store manager Mat Kuwitzky. "(We have) massive returns," he said, listing the problem games. "Sonic, Blue Stinger, NFL 2K and Ready 2 Rumble are all coming in. Probably one out of five of those games (sold) are defective. One out of 10 easily."

According to Kuwitzky, some Blue Stinger, Sonic Adventure, and Ready 2 Rumble discs freeze the device at startup, while some NFL 2K discs have audio problems. Activision, the publisher of Blue Stinger, confirmed the problems on a "small percentage of discs," said a spokesperson. Activision will overnight discs to affected consumers who call their toll-free hotline in the US.

Reports that some game discs work on store's demonstration machines, but not at home, had consumers worried that perhaps their Dreamcast machines were the problem. Sega adamantly denied that the unit caused the problems. "This is not a hardware problem," said Sega's Walker, adding that consumers can trade defective discs into retailers for working discs or, in the case of the Web browser, contact Sega or through customer support.

Online, some consumers vented over the defective discs. "I am truly amazed there could be a screw up like this," said one poster to the alt.video.games.sega-dreamcast Usenet group. "In all my years of buying things on CD -- games, music, software -- I've never encountered a screwed up disc." Yet, more than anger, the defects evinced sympathy from the Dreamcast users. "What a huge mess for (Sega)," said the poster. "Ouch."

In addition, almost all the Usenet posts were supportive of Sega. "As for system problems, I seem to share the same as everyone else," said another poster under the name "Jim," listing problems with Ready 2 Rumble and Sonic Adventure. "Unless there is anything more severe, I can live with it. All in all, I have to say, I'm 110 percent happy."