What If?

Our hypothetical history lesson examines what would happen if Pong, the 1983 industry crash and the Game Boy had never happened.
11/4/2008 5:30 PM | 0 Comments | Page 2 of 3

Following the money, other electronics companies try to copy Magnavox's success, including an underfunded Atari. Magnavox will have none of it, though, unleashing its massive legal department to defend its patents against anyone with the temerity to try to create an interactive game designed for the television. This strident legal wrangling gives Magnavox a near-monopoly over the domestic videogame market for over a decade. In Japan, however, a traditional card and toy company has developed a videogame system of its own...

What if Atari had avoided the "crash" and faced Nintendo head-on?

In early 1982, a forward-thinking Nolan Bushnell begins to recognize that an increasing flow of low-quality, third-party software could cause permanent damage to the image of the Atari 2600. To extend more control over the market, Bushnell spearheads development of what will become the Atari 2700. The new unit plays all old Atari 2600 games but also introduces a new, more-powerful chipset that supports an improved two-button joystick. The 2700 also includes a revolutionary lockout chip, which allows Atari to block games from companies that don't pay a hefty licensing fee. The system launches in time for the 1982 holiday season and quickly becomes a must-have item thanks largely to Pitfall!, an amazing new run-and-jump game developed by Atari's first first-party developer Activision (rumor has it that Atari paid over $50 million to acquire the fiercely independent company). Soon, games designed for the 2600 are considered "old-fashioned" and "boring," and a dozens of third-party developers are clamoring to pay for access to the 2700's new chipset and constantly growing base of gamers.

By 1985, when Nintendo first tests its new Entertainment System in America, Atari has had uninterrupted control of the lion's share of the home console market for nearly eight years. At first, the NES fails to cause much concern at Atari, but the company slowly begins to take notice when the revolutionary Super Mario Bros. starts dominating industry chatter and the sales charts. Shaken by this brash foreign newcomer, Atari speeds up its plans for the long-planned Atari 2800, an incremental update to the 2700. The newest Atari system is technically slightly less powerful than the NES, but it comes with a lower price tag (subsidized by years of Atari profits) and a copy of Pitfall III, the sequel to the first videogame to sell 10 million copies.

In the great console war of the late '80s, most game-makers are forced to stick with Atari's proven success, thanks to restrictive non-compete clauses in the Atari 2700 licensing agreement. Still, Nintendo attracts support from Japanese companies like Capcom and Konami that have never operated in America, thus securing exclusive rights to the home versions of some of the biggest arcade hits of the late '80s. Nintendo also attracts some new up-and-coming American developers, who use the NES' power and lower licensing fees to experiment with bold new experimental gameplay genres. While "in-the-know" gamers tend to prefer the unique, import-infused library for the NES, the masses prefer Atari's well-known domestic brand, which is bolstered by a massive advertising campaign that buries Nintendo's largely grassroots efforts. By 1990, Nintendo has managed to carve out a niche that represents an impressive but relatively insignificant 25 percent of the market. But Nintendo has a new system in the works...