Donkey Kong: Arcade (Left); Famicom (Right)
Once other publishers joined Nintendo in releasing Famicom carts, owners of that machine could enjoy Pac-Man, Space Invaders and even, for some reason, Front Line in the comfort and safety* of their own living rooms. Throughout 1984 and 1985, the Famicom subsisted almost entirely on ports; original titles from third party publishers began appearing in late 1985, and didn't really edge out ports until well into 1986. This was partially due to publishers realizing the demand for original games after the success of Super Mario Bros. But, as arcade hardware became increasingly powerful, the technology gap between arcade machines and the Famicom became increasingly wide.
However, this cycle seems to be repeating itself with the Master System. Recall the SMS's launch titles were Hang-On and Teddy Boy Blues. Since then, Sega has been rolling out releases of both grade A and grade B arcade games, often with a bit of marketing hoo-hah: Out-Run introduced the FM sound chip and After Burner - with 4 megabits of ROM - more than doubled the size of the largest carts available at the time.
Hang On: Arcade (Left); Master System (Right)
But by 1987, Sega was stuffing truckloads of scaling, rotating sprites into their latest arcade games. The Master System's Hang-On looked very impressive in 1985 and Fantasy Zone looked darned good in 1986. But by the time After Burner was released for the SMS in December of 1987... well, it was clear the jig was up. Four megabits or not, the After Burner port was a pretty sad looking beast. Alien Syndrome, from October of the same year, was not any better, despite the arcade version not displaying too many fancy graphical tricks.
After Burner: Arcade (Left); Master System (Right)
So Sega is at a crossroads of sorts. Should they continue to focus on producing a series of neutered ports of arcade titles? Or devote more resources towards making better, more substantial console-only games? The second choice seems to be a viable possibility with the release of Phantasy Star a few days after the SMS After Burner.
Alien Syndrome: Arcade (Left); Master System (Right)
Similar attempts at "console-style" games were made with Aztec Adventure, a vaguely Zelda inspired romp, and Zillion II: The Tri Formation, a considerably less inspired sequel to Sega's would be Metroid killer. Neither game succeeded in making much of an impression. All these titles will be covered in the upcoming Chronsega Episode 4. Whether the Master System will be able to reinvent itself as something other than a repository for middling arcade ports remains to be seen.
*Arcades were apparently havens for junvenile delinquents and shady characters. Or so we were informed by the mass media.