An excerpt of the cover of Atari's E.T. The Extra-Terrestrial

Excerpt of the cover of E.T. The Extra-Terrestrial, Atari 1982

The Great Video Game Crash - End Game

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Entire Industry, 1983-1984

High Hopes

Image of the show floor from the 1983 Winter Consumer Electronics Show (CES)

The Winter CES show floor, January 1983, Las Vegas

In 1983, sales in video games across the board have risen from 950 million dollars the previous year to $3.2 billion. Atari itself accounts for $900 million of that total. 25% of US homes have at least one system. There have been 12 million 2600‘s sold by Atari, the clear market leader owning 70 percent of the market, a company that employs almost 10,000 people in a huge sprawling system of buildings around Silicon Valley. There are over 200 games available their system, with new batches hitting the market every week. There are a million Intellivision’s sold by Mattel, with another million and a half ColecoVision sales for Coleco. By the end of the year, it was unraveling. In early 1984, it all comes to a crashing halt, with every major videogame system up to that point either being sold to independents or discontinued altogether. A public that had once seemed to possess an insatiable appetite for any new game or console to come down the pike now collectively turns their backs on the game makers. An industry that had practically sprung up overnight to dominate the entertainment sector crashes just as quickly.

Pac-Mess

Atari, comprising 2/3 of the industry, bears the brunt of the shakeout. The first sign of trouble comes with the 2600 version of Pac-Man, released in March 1982. It is designed by Tod Frye, who’s previous claim to fame is being the programmer of the Atari 400/800 port of Asteroids. Thanks to the words “Pac-Man” on the box, along with a $15 million advertising blitz, the game goes on to become the biggest selling Atari cartridge ever. It becomes rapidly apparent, however, that the quality of the game is awful, bearing only a very passing resemblance to the coin-op.

JUMP: History of the arcade version of Pac-Man

The graphics in the VCS port are horribly blocky, with the title-character a malformed circle with a bad case of lockjaw; his mouth opens and closes at a painfully slow rate, with the movement more like a mashing than a gobbling. Moving sluggishly around a maze that bears no resemblance to the coin-op game, the player gums thick dashes called “video wafers” to death instead of dots. The uni-coloured ghosts are a vision of massive flicker, almost invisible as they move around the maze, their eyes rotating meaninglessly. When one of the flashing square “power pills” are swallowed by Pac-Man, the ghosts turn a purple-ish shade of colour indicating their vulnerability to consumption, although the flickering makes it hard to tell the difference. The various prizes that Pac-Man can gobble up for points in the arcade game are represented by a two-tone coloured block called a “vitamin” that never changes shape. The only redeeming aspect of the game would be plenty of different game variations, but there are only eight, simply changing the speed at which the Pac-Man and the the ghosts move. As for sound, there is the grating three-note starting sound, the incessant clang-clang-clang as the Pac gums the rectangle “dots” to death, and the flat-as-a-pancake death sIt is painfully apparent that the game is a rush job, in order to quickly recoup the money paid by Atari to Namco for the Pac-Man license. Frye is ensconced in a room by himself to code for the four month deadline, and his end product results in a million dollar paycheque, which he cockily staples to his office door. Better versions are eventually released for other platforms like Atari’s own 400/800 computers and the 5200 Supersystem, as well as other manufacturers’ game platforms like the Commodore 64. Atari is eventually redeemed with the vastly improved Ms. Pac-Man on the 2600, released in February of 1983  The original, however, is an undeniable creative stumble by Atari, and no other game better demonstrates how overwhelmed the 2600 is graphically by emerging systems than Frye’s Pac-Man. Accompanying the game’s release is a massive backlash from critics and users alike, users who have had a cold splash of reality thrown into their face about just how obsolete the VCS has now become. There is a massive amount of returns of the cartridge back to stores by disappointed players, which gives pause to retailers when it comes time to place other game orders from Atari.

Of course, not every game released by the company is a turkey, as shown by the marvellous Yars’ Revenge, released in May of 1982. The game is originally conceived as a port of Cinematronics’ hit vector arcade game Star Castle until the licensing deal falls through. The designer is Howard Scott Warshaw, creator of some of the more complicated 2600 games, including Raiders of the Lost Ark and The A-Team, which starts out as a game called Saboteur until the graphics are altered and the name of the hit early 80′s Mr. T vehicle is slapped on the cartridge. He juggles the play mechanics of the now-license-less Star Castle port around a bit, and the result is one of the most original and involving games in the 2600 library. The title character’s name is taken from Atari president Ray Kassar, to show his triumph over the failed license deal. Yar’s Revenge is heralded with a two-minute commercial run in movie theatres, featuring state-of-the-art CGI by Robert Abel and Associates.

Extra-Terrible

Their next big fumble is E.T.: The Extra-Terrestrial. Warner chairman Steve Ross negotiates a 21 million dollar deal with Steven Spielberg and Amblin Entertainment for the exclusive worldwide coin-op and home game rights to the film, and Atari expects their game to match the success of the movie, at the time the highest-grossing ever made. The company also announces that Spielberg will be directly involved in the game’s development. Following his success with Yar’s Revenge, game designer Howard Scott Warshaw accepts the breakneck six week deadline to get the 2600 game out for December 1982. The resulting product nets Warshaw a $200,000 payment, but is torture for gamers, featuring frustrating control over the lost alien, along with endlessly confusing gameplay. Expecting a windfall of sales, around five million cartridges are manufactured and released to stores. Only one million eventually sell, leaving Atari with a massive inventory of unsold or returned cartridges as the game becomes one of the greatest videogame flops in history. Under cover of night sometime in 1983 a convoy of 14 tractor-trailer trucks are loaded with millions of unsold Pac-Man, E.T., and other surplus cartridges, along with various hardware prototypes and limited production runs littering Atari’s warehouses. The trucks are driven to a secret landfill site in Alamogordo, New Mexico, home of another big bomb; nearby was the site of the 1945 Trinity test, the first explosion of a nuclear device. The cartridges are ground up and then buried in huge cement sarcophagi. Atari later insists the midnight burial was done to dispose of “defective” inventory. If only they could bury the lack of confidence the abject failure of the E.T. videogame fosters in shareholders and consumers alike as easily. They’re not the only culprit, however, as both Mattel and Coleco overproduce cartridges in a market becoming less and less able to support them.

JUMP: E.T. commercials by Atari, YouTube playlist

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Comments >>

  1. avatarSawdust

    Enjoying reading your video game history. What is the “one special exception” mentioned in the shutdown of Atari game development?

    Reply

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