Panasonic M2

Lore & Background

The M2 hardware was co-designed by Dave Needle and RJ Mical, the same designers behind the 3DO Interactive Multiplayer. First announced as a peripheral chip for the 3DO with a custom PowerPC microprocessor, it evolved into a standalone console and was exhibited at the 1995 Electronic Entertainment Expo. For a time, it was scheduled to be released both as a standalone unit and as an add-on chip, though an M2 developer later stated that an add-on chip was not possible because the two architectures were too different. In October 1995, 3DO sold exclusive rights to Panasonic for $100 million, and Matsushita formed a new division in April 1996 named Panasonic Wondertainment Inc. to develop software in-house. Several third-party developers expressed concern that Panasonic would not provide the same quality of development support as 3DO, leading some to reconsider their involvement. Panasonic and Sega discussed a partnership over the M2, but talks broke down in the second quarter of 1996; 3DO president Trip Hawkins said, 'The deal was virtually done. It only fell apart at the last minute.'

Reader's Guide

The M2's significance lies in its trajectory from a high-profile console contender to a cancelled project whose technology found second lives in arcade boards, kiosks, and industrial systems. Despite being several times more powerful than any gaming console on the market at the time of its preview, the M2 failed to appear at the 1996 Electronic Entertainment Expo, and by the end of that year third-party developers stated it was not significantly more powerful than the Nintendo 64 in practice. Matsushita cancelled the project in mid-1997, unwilling to compete against Sony's PlayStation and Nintendo's Nintendo 64, both of which had recently released several top-selling games. The cancellation came so close to release that marketing flyers had already been distributed and gameplay screens of prospective launch titles were in circulation. The M2's technology was later integrated into multimedia players aimed at professionals, a Konami arcade board (which suffered from long load times and high failure rates, yielding only five games), interactive kiosks, automated teller machines, and coffee vending machines in Japan. Development kits and prototypes became valuable collector's items.

Did You Know?

• The M2 could generate 1 million polygons per second with graphics features turned off and 700,000 with features on.
• The M2 technology was used in automated teller machines and coffee vending machines in Japan.
• Only five games were developed for the Konami M2 arcade board due to long load times and high failure rates.

From Chip to Console

The M2 began life not as a standalone machine but as an expansion chip meant to bolt onto the 3DO Interactive Multiplayer. Co-designed by Dave Needle and RJ Mical, the project was built around a custom PowerPC microprocessor and was first unveiled at the 1995 Electronic Entertainment Expo. For a period, 3DO planned to ship the M2 in two forms: as a dedicated console and as an add-on cartridge for existing 3DO hardware. That dual strategy quickly unraveled. By 1996, a developer working on the platform made it clear that the architectural gap between the two systems was simply too wide to bridge with a single add-on chip. The M2 was, by that point, its own creature—a full multimedia terminal with ambitions far beyond what a peripheral could deliver. The shift from accessory to successor system set the stage for the corporate drama that would follow, as 3DO looked for partners to bring the hardware to market.

The $100 Million Handoff

3DO's original business model for the M2 mirrored what they had done with the 3DO Interactive Multiplayer: license the hardware to multiple manufacturers. Both Matsushita and GoldStar signed on to produce units. But that plan collapsed when 3DO sold exclusive rights to Panasonic for $100 million in October 1995, then gradually withdrew from the project over the following months. Panasonic responded by creating Panasonic Wondertainment Inc. in April 1996, a Tokyo-based division dedicated to in-house M2 software development. The transition alarmed third-party studios, several of whom warned they were losing the high-quality development support they had received from 3DO and were seriously weighing whether learning the M2 toolchain was still worth the investment. Meanwhile, Panasonic and Sega were deep in partnership negotiations, but those talks fell apart in the second quarter of 1996. 3DO president Trip Hawkins later described the near-deal as "virtually done," breaking down only at the last minute. The M2 was left without a clear publishing backbone.

The Console That Almost Was

The M2's final months were defined by uncertainty and slow erosion. At the 1996 E3, the console was conspicuously absent; a Panasonic representative admitted the company had not yet decided whether the M2 would even ship as a gaming platform. By late 1996, no release date existed, and developers were openly telling the press that the hardware was not meaningfully more powerful than the Nintendo 64. Electronic Gaming Monthly captured the mood perfectly, describing months where the project seemed to be afloat—rumors of demos, tantalizing hints from executives—followed by months where developers were "scrambling to get off the boat." The cancellation came in mid-1997, with Matsushita unwilling to go head-to-head against Sony's PlayStation and Nintendo's N64, both of which had just posted strong sales. The news leaked in late May but was not officially confirmed until July, when Matsushita president Yoichi Morishita made the announcement. The timing was cruel: promotional flyers had already been printed, and gameplay screenshots from several planned launch titles were circulating publicly.

A Second Life in Silicon

Though it never reached living rooms, the M2's silicon found surprising new homes. In 1997, Matsushita rebranded the hardware as an industrial platform for custom multimedia simulations. By 1998, its technology powered the FZ-21S and FZ-35S multimedia players, devices aimed squarely at professionals in medicine, architecture, and sales rather than consumers. Konami also built a short-lived arcade board around the M2, an arrangement agreed well before the console's planned launch with the expectation that arcade titles would eventually port to the home system. In practice, the board's reliance on CD-ROM for game data caused punishing load times and a high hardware failure rate, limiting its library to just five titles. In the late 1990s and into the 2000s, the M2 appeared in interactive kiosks, automated teller machines, and even Japanese coffee vending machines. PlanetWeb even offered software in 2000 to repurpose the system as an Internet appliance. All kiosk applications were built with CDMotion for M2/M2X, a point-and-click, codeless SDK—a far cry from the Macintosh-based development tools originally envisioned for the console.