The problem that the 3DO console had was that it was not manufactured by them directly. They licensed this to Panasonic, Sanyo, and Goldstar, resulting in a massive MSRP. 3DO had those too, but since nobody was taking a hit on the hardware, it went straight to the consumers. No, it was worse, because the hardware manufacturers had to make a profit themselves! Therefore, what should have been an entry at say $300-350 with later discounts became $599-699 or somewhere in between. That killed the system really from day one. Sony, Nintendo, Sega all sold their hardware at a loss, with profits coming from software licenses. Meanwhile, 3DO charged a pittance comparatively, meaning that low sales generated them even worse revenue.

The initial library was not superb, that's for sure, but also no worse than what the PS1 had on debut, or the Saturn. However, like SEGA, 3DO simply did not have the capital reserves of Sony, and need a big splash right away. People were still buying 16-bit consoles at a bargain, with games getter better and better on those consoles.