Let’s hop in the wabac machine and set it for 1988. Nintendo was the only company with a console (technically Sega had a console, but it didn’t sell at all in America). How many great games were released? Well, plenty, but no more than we’ve seen on PS1 or PS2. How many bad games were released? Plenty there, too. More importantly, though, since Nintendo was the only company out there, there were some pretty strong regulations on the game makers. For example, each 3rd party licensee was only allowed to make 3 games per year. If they wanted to make more than that, they had to wait until the next year (eventually companies got around this by making wholly owned subsidiaries, like Konami’s “Ultra Games,” and Acclaim’s “LJN”). Companies were threatened with losing their license to publish Nintendo games if they tried to make games for another system, like the Sega or Commodore (which Acclaim got around by forming “Flying Edge,” and Capcom sold the rights to many of their games to “US Gold”).
The most important part, however, is that games then cost $79.99 or higher. When Atari was the only name on the market, you could buy a copy of Asteroids for $99.99 and up. Fortunately, my family got that game on clearance for $59.99.
The point is that the competition is good for the market. And consoles aren’t coming out any faster than they used to. Handhelds are, but that’s because more companies are trying to compete. Let’s look at the timeline here (all dates US):
1977: Atari 2600
1980: Intellivision
1982: Atari 5200
1982: Colecovision
1982: Commodore 64
1984: Atari 7800
1985: Nintendo Entertainment System
1986: Sega Master System
1989: Sega Genesis
1989: TurboGrafx-16
1991: Philips CD-i
1991: Super Nintendo Entertainment System
1992: TurboDuo
1993: 3DO Interactive Multiplayer
1993: Atari Jaguar
1993: Sega CD
1994: Sega 32X
1995: Sega Saturn
1995: Sony Playstation
1996: Nintendo 64
1999: Sega Dreamcast
2000: Sony Playstation 2
2001: Microsoft Xbox
2001: Nintendo Gamecube
That’s just consoles, and that’s only the more promonent ones that came out in the US. Here’s a look at memorable handhelds worldwide:
1989: Atari Lynx
1989: Gameboy
1990: TurboExpress
1991: Game Gear
1995: Gameboy Play It Loud!
1996: Gameboy Pocket
1997: Game.com
1998: Gameboy Color
1998: Neo Geo Pocket
1998: Neo Geo Pocket Color
1999: Wonderswan
2000: Wonderswan Color
2001: Gameboy Advance
2001 (?): SwanCrystal
2003: Gameboy Advance SP
2004: Nintendo DS
2005: Sony PSP
Again, that’s just promonent ones. There’ve been others. My point is, there’s almost never been a time when there was only one console/handheld on the market, and whenever there was, the only advantages were lack of innovation and high prices.