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Damien McFerran

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Located on a rather nondescript industrial estate in a suburb of Leicester you'll find an equally nondescript warehouse unit. Nestled amongst the usual glut of logistics companies and scrap metal merchants, the building in question once housed a firm that was poised to dramatically alter the world of interactive entertainment as we know it, and worked with such illustrious partners as Sega, Atari, Ford and IBM.

That company was Virtuality. Founded by a dashing and charismatic Phd graduate by the name of Jonathan D. Waldern, it placed the UK at the vanguard of a Virtual Reality revolution that captured the imagination of millions before collapsing spectacularly amid unfulfilled promises and public apathy.

The genesis of VR begins a few years prior to Virtuality's birth in its grey and uninspiring industrial surroundings. The technology was born outside of the entertainment industry, with NASA and the US Air Force cooking up what would prove to be the first VR systems, intended primarily for training and research. The late '80s and very early '90s saw much academic interest in the potential of VR, but typically, it took a slice of Hollywood hokum to really jettison the concept into the global consciousness and create a new buzzword for the masses.

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Arcade gaming might have flat-lined here in the West, but in Japan it continues to endure, despite the fact that the coin-op industry is a shadow of its former self.

The infectious vibrancy and energy of this culture has inspired Canadian filmmaker Brad Crawford to create 100 Yen: The Japanese Arcade Experience: a movie that delves deep into the country's obsession with location-based entertainment.

"The film's title is inspired by the fact that Space Invaders caused a nation-wide 100 Yen coin shortage; people were literally spending coins faster than they could circulate," Crawford told Eurogamer.

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When Sega discontinued production of the Dreamcast console in 2001 and withdrew from the domestic hardware market, it marked the conclusion of one of the most tumultuous and error-strewn periods in the company's 72-year history. Sega Enterprises' spectacular fall from grace during the course of the 1990s remains a tragic spectacle of overconfidence and woefully misguided business practice.

At the start of the decade, Sega stood astride the gaming world like a colossus; it had smashed Nintendo's vice-like stranglehold in the US and conquered Europe with its street-smart marketing. But by the close of the '90s, the company's reputation was in tatters, its user-base had all but collapsed and it was driven dangerously close to the yawning abyss of insolvency.

This is the story of how The House That Sonic Built came crashing down in spectacular fashion.

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