Well, the DC had a few huge problems going for it.
1) The release date, as Sov already mentioned. They released it far too early, and in order to try and keep up with competitor sales, they had to drop the price so low that it looked like a bargain bin console. Really damaged the Dreamcast's image.
2) The game selection was pretty bad. Yeah, it had Soul Calibur, Skies of Arcadia and some apparently badass football games. That won't keep an entire console alive for very long.
Hybrid Mode
