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Phantasmagoria is, undoubtedly, a key point in gaming history.
Phantasmagoria's concept is nothing new - a haunted house, ghostly possession, some gore and mystery added to the mix and that's that. The story is predictable, characters are bland, heck, even the puzzles are nothing much.
However, besides the obvious nostalgia factor for most of us, there is one thing that separates Phantasmagoria from the rest and that is, in my opinion, mood. The tone and setting of the game, the epic castle filled with corridors, hidden rooms, odd devices... Every chapter of the game shows a new aspect of the castle, and things...change throughout. There is some non-linearity to be found as well, as some events are not bound to specific chapters, while some are. There are few key events and items needed to fully complete the game, and it is intentionally easy to miss them; whether this is good or bad, I leave that to you. Also of note is the wild ending sequence which actually does scare you a bit, along with one particularly striking and infamous rape scene (which I hope is included in GOG's release, uncensored).
Phantasmagoria was a technological leap forward back then, and even though it looks and feels downright silly today, with it's cheesy acting, horrible script, eye-crunching 'real-time graphics' and such, it is still a milestone in gaming's development, and should be seen as such. You might not like it for the plot or the relatively easy playthrough, but if you're into some history and acknowledge the 'so bad it's good' theory, then by all means, play it and enjoy it. We who loved it back then already have our copy. :)