Master System
Sega's first real swing at Nintendo began in Japan in 1985 as the Mark III, then got this black-and-red restyle and the Master System name for North America in 1986. It never shook the NES's grip in the United States, but it did well in Europe and became a phenomenon in Brazil, where Tectoy kept selling versions of it for decades. Alex Kidd in Miracle World was built into later models, and Phantasy Star showed what its hardware could manage.
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