Haha. Poor, poor Sega. Outside of the Genesis, all of their consoles pretty much tanked. As one of the hardcore Sega fans, I must admit I would be pretty much excited if there was such a thing.
Unfortunately, the reality remains that the industry cannot afford to support multiple console formats. Yes, we are used to the 3-console format wars for a while now, but even then, there will always be a dominant winner. And unfortunately, most console gamers do not favour Sega.
Let's see.....
1. SNES vs Genesis: SNES won. Technically, they were equal. In the US. But overall? The SNES won by a landslide. Except in Europe, where the Megadrive was more popular.
2. Saturn vs PlayStation vs N64: Huh. PlayStation pretty much won by default, if numbers are to be believed. N64, despite having an expensive cartridge format, came in second. Leaving Sega to be 3rd. My, how sad.
3. Dreamcast vs PlayStation 2. Like this battle needs an introduction. Honestly, the Dreamcast was supposed to be the console to win the crowd over. Beautiful graphics, web browsing capabilities, online play (in 1999!), killer launch line-up. But this battle was dead before it ever began. Why? Since a lot of people already gave up on the Sega name, and would rather go to PlayStation. That, and of course, the killer PS2 games announced at E3 2000: Devil May Cry, Ico, and a little title called Metal Gear Solid 2. We all know what happened to the people who were still deciding on Dreamcast or PS2.
OK, now that I got all that off my chest, here's the real reason I think they will fail: Nintendo is too dominant. It's been proven time and again. Back in 1989, Sega released their handheld console, the Game Gear. Beautiful LCD screen, colourful graphics, good games line-up.... marred by absolutely terrible battery life. Nintendo pretty much won the handheld wars pretty easily.
Heck, even other companies have tried and died terrible, terrible deaths; Atari, Tiger Electronics, SNK, and more recently, Bandai. With so many casualties, you'd think other companies have pretty much given up getting into the handheld market. Sony is the only company that has actually given Nintendo a run for their money, but still? Right now, DS is outselling PSP by a huge margin.
As for Sega, I wholeheartedly accept that they are no longer in the console business. They still make killer arcade hardware though, which, in my opinion, is far more profitable (in Japan anyway). I love how Chihiro and Lindbergh games look compared to the System-256 arcade hardware.
Ahem. After all that rambling, the bottom line is that no, I don't think it's a hot idea for Sega to release a handheld console. After all, we already know Sega will be supporting the Wii's virtual console with some of their back catalog of great games. I could be wrong though, given that I am a Sega nut. SEGA!!
I am a die hard SEGA fanboy myself. Having own every peice of SEGA hardware available expect the Game Master and SEGA PC. Ya, I have the obscurde MEGA CD too.
It all boils down to which console has the most pirated game will dominate the market.