In the history of computer and video games, the fourth generation (more commonly referred to as the 16 bit era) began on October 30, 1987 with the Japanese release of Nippon Electric Company's (NEC) PC Engine (known as the TurboGrafx-16 in North America). Although NEC released the first fourth generation console, this era was dominated by the rivalry between Nintendo and Sega's consoles; the Super Nintendo Entertainment System (the Super Famicom in Japan) and the Mega Drive (named the Sega Genesis in North America due to trademark issues). Nintendo was able to capitalize on its previous success in the third generation and won a dominant market share in the fourth generation as well. Sega was also successful in this generation and began a new franchise, Sonic the Hedgehog, to compete with Nintendo's Mario series of games. Several other companies released consoles in this generation, but, with the exception of the Neo Geo, none of them were widely successful. Nevertheless, several other companies started to take notice of the maturing video game industry and began making plans to release consoles of their own in the future.

Home consoles

TurboGrafx-16

The PC Engine was the result of a collaboration between Hudson Soft and NEC and launched in Japan on October 30, 1987. It launched in North America during August 1989, under the name TurboGrafx-16.

Initially, the PC Engine was quite successful in Japan, partly due to titles available on the then-new CD-ROM format. NEC released a CD add-on in 1990 and by 1992 had released a combination TurboGrafx and CD-ROM system known as the Turbo Duo.

In the USA, NEC used Bonk, a head-banging caveman, as their mascot and featured him in most of the TurboGrafx advertising from 1990 to 1994. The platform was well received initially, especially in larger markets, but failed to make inroads into the smaller metropolitan areas where NEC did not have as many store representatives or as focused in-store promotion.

The PC Engine failed to maintain its sales momentum or to make a strong impact in North America. The TurboGrafx-16 and its CD combination system, the Turbo Duo, ceased manufacturing in North America by 1994, though a small amount of software continued to trickle out for the platform. NEC released the 32-bit PC-FX console the same year in Japan. Plans were underway for a North American release of the PC-FX, but an already flooded market of platforms, including the more powerful 3DO and Atari Jaguar systems, caused TTI, who by then had the US rights to the TurboGrafx platform, to halt its North American release plans.

In Japan, a number of more adult titles were also available for the PC-Engine, such as a variety of strip mahjong games (such as the Super Real Mahjong series), which set it apart from its competitors.

Sega Mega Drive/Genesis

The Sega Mega Drive was released in Japan on October 29, 1988. The console was released in New York City and Los Angeles on August 14, 1989 under the name Sega Genesis, and in the rest of North America later that year. The Mega Drive was launched in Europe and Australia on November 30, 1990.

Sega initially had a hard time overcoming Nintendo's ubiquitous presence in the American consumer's home. That changed in late 1990, as Sega built their marketing campaign around their new mascot Sonic the Hedgehog, pushing the Genesis as the "cooler" alternative to Nintendo's console and inventing the term "Blast Processing" to suggest that the Genesis was capable of handling games with faster motion than the SNES. Their advertising was often directly adversarial, leading to commercials such as "Genesis does what Nintendon't" and the "'SEGA!' scream".

When the arcade game Mortal Kombat was ported for home release on the Genesis and Super Nintendo Entertainment System, Nintendo decided to censor the game's gore, but Sega kept the content in the game, VIA a code entered at the start screen (A,B,A,C,A,B,B). Sega's gamble paid off, as its version of Mortal Kombat received generally higher and more favorable reviews in the gaming press and outsold the SNES version three to one. This violence also led to Congressional hearings to investigate the marketing of violent video games to children, and to the creation of the Interactive Digital Software Association and the Entertainment Software Rating Board. With the new ESRB rating system in place, Nintendo reconsidered its position for the release of Mortal Kombat II, and this time outsold Sega's version. Sega, however, ran into a minor roadblock with the popularity of fighting games with advanced controls, because its controller only featured three action buttons. In response, Sega introduced a 6-button controller. Most new games could still be played with the original 3-button controller, however, but the company suggested its gamers buy and adopt the new 6-button model.

Despite the Genesis's success in North America, the Mega Drive was never popular in Japan. By late 1995, Sega was supporting five different consoles and two add-ons, and Sega of Japan chose to discontinue the Mega Drive to concentrate on the new Sega Saturn. While this made perfect sense for the Japanese market, it was disastrous in North America: the market for Genesis games was much larger than for the Saturn, but Sega was left without the inventory or software to meet demand.

Super Nintendo Entertainment System

Nintendo executives were initially reluctant to design a new system, but as the market transitioned to the newer hardware, Nintendo saw the erosion of the commanding market share it had built up with the Famicom (called Nintendo Entertainment System outside Japan). Nintendo's fourth-generation console, the Super Famicom, was released in Japan on November 21, 1990; Nintendo's initial shipment of 300,000 units sold out within hours. The machine reached North America in August or September 1991, and Europe and Australia in April 1992.

Despite stiff competition from Sega's Mega Drive console, the Super NES eventually dominated the American 16-bit console market, and would even remain popular well into the 32-bit generation. Nintendo's market position was defined by their machine's increased video and sound capabilities.

Neo Geo

Released by SNK in 1990, the Neo Geo was a home console version of the major arcade platform. Compared to its console competition, the Neo Geo had much better graphics and sound, but the prohibitively expensive launch price of $649.99 USD made the console only accessible to a niche market. A less expensive version, retailing for $399.99, did not include a memory card, pack-in game or extra joystick.

Add-ons

Nintendo, NEC and Sega also competed with hardware peripherals for their consoles in this generation. NEC was the first with the release of the TurboGrafx CD system in 1990. Retailing for $499.99 at release, the CD add-on was not a popular purchase, but was largely responsible for the platform's success in Japan. Sega made two attempts: the Sega Mega-CD (renamed Sega-CD in North America) and the Sega 32X, neither of which were very successful. The Mega CD was plagued by a high price tag ($300 at its release) and a limited library of games. The 32X faced a number of problems, primarily technical and commercial: the peripheral would occasionally not work with some consoles, and some retailers were not able to meet the initial demand for the add-on, leading to shortages. A unique add-on for the Sega console was Sega Channel. Sega Channel was a subscription based service hosted by local television providers. It required hardware that plugged into a cable line and the Sega.

Nintendo made an attempt with their successful Satellaview and Super Game Boy. The former was a satellite service released only on the Japanese market and the latter an adapter for the Super Nintendo that allowed Game Boy games to be displayed on a TV in color. Interestingly, Nintendo, working along with Sony, also had plans to create a CD-ROM drive for the Super NES, similar to the Sega CD, but eventually decided not to go through with that project, opting to team up with Philips in the development of the add-on instead. Sony decided to go ahead with the CD-ROM development and used the name "PlayStation" for their own stand-alone CD-based console, overseen by former SNES sound-chip engineer, Ken Kutaragi. The PlayStation went on to badly hurt CD-i sales, and Philips dropped the product line in 1998.


European and Australian importing

The fourth generation was also the era when the act of buying imported US games became more established in Europe, and regular stores began to carry them. This was especially popular with SNES games, due to several reasons, including the fact that the PAL region has a refresh rate of 50Hz (compared with 60 Hz for NTSC) and a vertical resolution of 625 interlaced lines (576 effective), compared with 525/480 for NTSC.

This fact meant that a game designed for the NTSC standard without any modification would run 17% slower and have black bars at the top and bottom when played on a PAL television. Developers often had a hard time converting games designed for the American and Japanese NTSC standard to the European and Australian PAL standard. Companies such as Konami, with large budgets and a healthy following in Europe and Australia, readily optimised several games (such as the International Superstar Soccer series) for this audience, while most smaller developers did not.

Also, few RPGs were released in Europe because they would have needed to been translated into many different languages. RPGs tend to contain much more text than other genres, so one of the biggest problems was simply fitting all of the full translations into one cartridge. The cost of creating multiple full translations was also prohibitive. Only the UK and Australia saw any number of RPG releases, and even then the number was a fraction of what was being released in Japan. For the Mega Drive, there were numerous PAL releases of RPGs. Example includes Phantasy Star II, III and IV, Shining in the Darkness, Shining Force and its sequel, Sword of Vermilion, Super Hydlide, Landstalker, Story of Thor, Soleil and Light Crusader. A few of them received French and German translations.

Popular US games imported at this time included Final Fantasy II (known in Japan as Final Fantasy IV), Final Fantasy III (known in Japan as Final Fantasy VI), Secret of Mana, Street Fighter II, Chrono Trigger, and Super Mario RPG.


Worldwide sales standings

Console/Units sold
Super Nintendo Entertainment System/Super Famicom     49 million (as of August 4, 2007)
Sega Mega Drive/Genesis     29 million (as of May 15, 2007)
TurboGrafx-16/PC Engine     10 million (as of July 30, 2007)
Mega-CD (Mega Drive/Genesis add-on)     6 million (as of July 30, 2007)
CD-i     570,000 (as of July 30, 2007)
Sega 32X (Mega Drive/Genesis add-on)     200,000 (as of July 30, 2007)

Handheld systems

The first handheld game console released in the fourth generation was the Game Boy, on April 21, 1989. It went on to dominate handheld sales by an extremely large margin. Despite featuring a monochrome screen, when its closest competitor, the Atari Lynx, included color graphics, a backlight, and networking capabilities, its comparatively short battery life and high price proved to be the Lynx's undoing. Two major franchises made their debut on the Game Boy; Tetris; the Game Boy's killer application, and Pokémon. The third major handheld of the fourth generation was the Sega Game Gear. It featured graphics capabilities comparable to the Master System, but it also inherited the same shortcomings as the Lynx. While it did not sell as few units as the Lynx, its bulky design and low battery life caused it to be pushed to the sidelines.

Other handheld consoles released during the fourth generation included the TurboExpress, a handheld version of the TurboGrafx-16 released by NEC in 1990, and the Game Boy Pocket, an improved model of the Game Boy released about two years before the debut of the Game Boy Color. While the TurboExpress was another early pioneer of color handheld gaming technology and had the added benefit of using the same game cartridges or 'HuCards' as the TurboGrafx16, it had even lower battery life than the Lynx and Game Gear; about three hours on six AA batteries; and numerous hardware problems, selling only 1.5 million units by 2007.

Software

While many of them originated in the 8-bit era, many of the major franchise titles came of age and solidified their grip on the market in the 16-bit era. Metroid, Zelda, Star Fox, Kirby, Dragon Quest, Final Fantasy, Seiken Densetsu (Secret of Mana), Sonic the Hedgehog, Donkey Kong, Street Fighter, Mortal Kombat, Mega Man X, and many others had either their first releases or some of their most popular titles during the 16-bit era.

Sonic the Hedgehog was Sega's bid to compete head-to head with Nintendo's Mario franchise. Debuting in 1991, Sega's marketing of the Sonic franchise was key to Sega's success in the video game market during the early years of this generation. Though a critical and commercial success, Sonic the Hedgehog and later series games were not able to surpass Mario in popularity.

Metroid II was released for the Game Boy and Super Metroid was released in 1994 on a comparatively large 24 megabit cartridge for the SNES. Super Metroid still is regarded by many gaming organizations as one of the "best games of all time."

The Legend of Zelda: A Link to the Past, courted popularity that was larger than that of its predecessors on the NES. It was one of the few action-adventures to be released early in the SNES's lifecycle. Zelda II on the NES had been mostly action-based and was side-scrolling, while A Link to the Past drew more inspiration from the original Zelda game with its top-down adventure format.

Dragon Quest V and VI were released on the Japanese Super Famicom, as well as remakes of the first three games originally released for the NES and a dungeon crawler spin-off: Torneko's Great Adventure, which started Chun Soft's popular Fushigi no Dungeon series.

Star Fox was the first SNES game to feature the Super FX chip. This game also marked the first quest to stop the evil Andross from taking over the Lylat System. There had been a Star Fox 2 with new characters in development for the SNES, but this game was canceled in the beta stages because of the approaching release of the N64.

Final Fantasy V was released only in Japan, while Final Fantasy IV and Final Fantasy VI were released in North America with their original numeration shifted. While the series was very successful in Japan early on, it was not until the release of Final Fantasy VII on the PlayStation that it reached blockbuster status outside Japan.

Secret of Mana reintroduced the Seiken Densetsu series, originally conceived as a Final Fantasy spin-off, to Europe and North America.

Street Fighter II, an SNES port of the arcade original, was the second game in the series that produced a lasting fanbase and set many of the trends seen in fighting games today, most notably its colorful selection of playable fighters from different countries across the globe. As of 2008, it is Capcom's best-selling consumer game of all time.

Phantasy Star was Sega's RPG franchise that was established 1987 on the Sega Master System. It was the first console RPG game to reach Europe; almost a decade before Final Fantasy VII. Three sequels were released to the Mega Drive. With its sci-fi theme, the franchise was unique from fantasy-themed Dragon Quest and Final Fantasy.

Thunder Force II, III and IV were all released for the Mega Drive, but the third game never reached Europe and the fourth was called Lightening Force: Quest for the Darkstar (sic) in the US.

Seeking to follow the example of the above titles, several more franchises were born during this era, many of which have not survived to the present day. While game sequels were far from uncommon during the 8-bit era and even before, it was at this time that the potential for continuing series games was realized.