Yes. The same is said about the Sega-Sony deal, which Sega is often criticized for not following up on. The accounts of former executives make it clear, however, that it was too risky to work with Sony due to their ultimate motives. Sony wanted to dominate the market from the beginning, and they wanted to use established companies as an entry point.
Also, the contract between Nintendo and Sony was signed in 1989, and Sony would have received all royalties from CD-ROM sales. This was at a time when it was still not clear that CD-ROMs would soon dominate the market. However, that had changed by 1991 when the Nintendo Play Station was revealed.
Then-president of Sony, Norio Ohga, said the following in his autobiography: “What we learned later was that Yamauchi’s son-in-law, then the head of Nintendo’s U.S. operations, had apparently nixed the deal. The son-in-law, Minoru Arakawa, had witnessed firsthand the stunning growth in U.S. sales of CD-ROM drives and disks. Arakawa knew that Sony had built a strong position in CD-ROM products. And he apparently feared that Sony would get the better of Nintendo in a collaboration.”
Also, the contract between Nintendo and Sony was signed in 1989, and Sony would have received all royalties from CD-ROM sales. This was at a time when it was still not clear that CD-ROMs would soon dominate the market. However, that had changed by 1991 when the Nintendo Play Station was revealed.
Then-president of Sony, Norio Ohga, said the following in his autobiography: “What we learned later was that Yamauchi’s son-in-law, then the head of Nintendo’s U.S. operations, had apparently nixed the deal. The son-in-law, Minoru Arakawa, had witnessed firsthand the stunning growth in U.S. sales of CD-ROM drives and disks. Arakawa knew that Sony had built a strong position in CD-ROM products. And he apparently feared that Sony would get the better of Nintendo in a collaboration.”