I will forever wonder why 8-bit computers of the 80s didn't have more powerful video hardware. It's not that the technology wasn't available, since most arcade machines at the time had a lot more powerful graphics hardware than 8-bit home machines. (I will also forever wonder why Sega's 16-bit console didn't have hardware sprite scaling and rotation, since that was the main attraction of Sega games at the time...) I…
It's my understanding, that the reason why arcade boards were so much more powerful was because they were a lot more complex thus much more expensive to design, source components and produce in large scale. More colors, background layers and sprites with slow CPUs and graphics chips in the 80s usually meant having several RAM chips to have multiple memory buses and parallel accesses to video memory and more video mem…
The effect is arcade machines almost never had custom chips, but often had duck-taped-together designs that threw in extra chips to accomplish tasks.
Contrast to a machine like the Commodore 64 or Nintendo which had custom sound and graphic chips but where the overall chip count and unit cost was ruthlessly controlled.