There was several problems with SF3.
Like SSJ stated, CPS3 was unpopular and killed wallets, and people were turned off by the "freakshow" characters(despite only about 4/5 really apply to that.)
The other problem was it took 3 iterations to finally get it right(NG and SI I enjoyed, but they had severe problems), and even then 3rd Strike goofed up in some places (What up Chun, Poor Sean).
Another problem was it came at a very bad time, as 2D fighters and arcades in general at the time were in decline.
The biggest problem with 3S was that it..really wasn't street fighter per se, since Zoning was more or less nonexistant. Footsies were still there and very dominant but Zoning was all but gone, that may have pissed off lots of people.
But despite its flaws, I still go crazy for 3S.
3SOE though.......way to goof it up guys.
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Nice catch BlAcK TuRtLe.
But too bad your ass got SAAAAAAAAAAACKED.*tackles*