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Activision becoming a 3rd party sparked the Video Game Crash of 1983

onQ123

Member

Loss of publishing control[edit]​

Prior to 1979, there were no third-party developers, with console manufacturers like Atari publishing all the games for their respective platforms. This changed with the formation of Activision in 1979. Activision was founded by four Atari programmers who left the company because they felt that Atari's developers should receive the same recognition and accolades (specifically in the form of sales-based royalties and public-facing credits) as the actors, directors, and musicians working for other subsidiaries of Warner Communications (Atari's parent company at the time). Already being quite familiar with the Atari VCS, the four programmers developed their own games and cartridge manufacturing processes. Atari quickly sued to block sales of Activision's products, but failed to secure a restraining order, and ultimately settled the case in 1982. While the settlement stipulated that Activision must pay royalties to Atari, this case ultimately legitimized the viability of third-party game developers. Activision's games were as popular as Atari's, with Pitfall! (released in 1982) selling over 4 million units.

Prior to 1982, Activision was one of only a handful of third parties publishing games for the Atari VCS. By 1982, Activision's success emboldened numerous other competitors to penetrate the market. However, Activision's founder David Crane observed that several of these companies were supported by venture capitalists attempting to emulate the success of Activision. Without the experience and skill of Activision's team, these inexperienced competitors mostly created games of poor quality.[6] Crane notably described these as "the worst games you can imagine".[7] While Activision's success could be attributed to the team's existing familiarity with the Atari VCS, other publishers had no such advantage. They largely relied on industrial espionage (poaching each other's employees, reverse-engineering each other's products, etc.) in their attempts to gain market share. In fact, even Atari themselves engaged in such practices, hiring several programmers from Mattel's Intellivision development studio, prompting a lawsuit that included charges of industrial espionage.

The rapid growth of the third-party game industry was easily illustrated by the number of vendors present at the semi-annual Consumer Electronics Show (CES). According to Crane, the number of third-party developers jumped from 3 to 30 between two consecutive events.[7] At the Summer 1982 CES,[5] there were 17 companies, including MCA Inc., and Fox Video Games announcing a combined 90 new Atari games.[8] By 1983, an estimated 100 companies were attempting to leverage the CES into a foothold in the market. AtariAge documented 158 different vendors that had developed for the Atari VCS.[9] In June 1982, the Atari games on the market numbered just 100. By December, that number grew to over 400. Experts predicted a glut in 1983, with only 10% of games producing 75% of sales.[10]

BYTE stated in December that "in 1982 few games broke new ground in either design or format ... If the public really likes an idea, it is milked for all its worth, and numerous clones of a different color soon crowd the shelves. That is, until the public stops buying or something better comes along. Companies who believe that microcomputer games are the hula hoop of the 1980s only want to play Quick Profit."[11] Bill Kunkel said in January 1983 that companies had "licensed everything that moves, walks, crawls, or tunnels beneath the earth. You have to wonder how tenuous the connection will be between the game and the movie Marathon Man. What are you going to do, present a video game root canal?"[12] By September 1983 the Phoenix stated that 2600 cartridges were "no longer a growth industry".[13] Activision, Atari, and Mattel all had experienced programmers, but many of the new companies rushing to join the market did not have the expertise or talent to create quality games. Titles such as the Kaboom!-like Lost Luggage, rock band tie-in Journey Escape, and plate-spinning game Dishaster, were examples of games made in the hopes of taking advantage of the video-game boom, but later proved unsuccessful with retailers and potential customers.

The flood of new games was released into a limited competitive space. According to Activision's Jim Levy, they had projected that the total cartridge market in 1982 would be around 60 million, anticipating Activision would be able to secure between 12% and 15% of that market for their production numbers. However, with at least 50 different companies in the new marketspace, and each having produced between one and two million cartridges, along with Atari's own estimated 60 million cartridges in 1982, there was over 200% production of the actual demand for cartridges in 1982, which contributed to the stockpiling of unsold inventory during the crash.[14]


https://en.wikipedia.org/wiki/Video_game_crash_of_1983

Edit: Video

 
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Barakov

Gold Member
And Activision becoming a part of a first party will cause another one.
Alanis Morissette Reaction GIF by MOODMAN
 

Elysion

Banned
Interesting, since in our time it seems the opposite is happening, and that the age of the 3rd party publisher is coming to an end. Activision’s independence in 1979 marked the beginning of the age of 3rd parties, and their (likely) loss of independence in 2023 will mark its end. So I guess we‘ve come full circle?
 
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onQ123

Member
Interesting, since in our time it seems the opposite is happening, and that the age of the 3rd party publisher is coming to an end. So I guess we‘ve come full circle?
They opened the floodgates & Nintendo saved the industry.

This also reminds me of Steam saving PC gaming.


The industry is pretty much healthy all around right now so it's strange that Microsoft is trying to disrupt it .

We have games selling 10 , 20 , 30 , 40 , 50 & even 100 million copies right now
 

yurinka

Member
The 1983 crash concepth is a too USA centric myth. It didn't exist specially outside USA, it simply was a handful top companies we're able to repeat huge success they had a few years before (Namco with Pac-Man or Galaxian, Taito with Space Invaders) but mostly from USA (Atari in both consoles and arcade, Activision hurt by a flood of companies joining them as 3rd parties for Atari consoles) that were making a ton of the market money and tanked,- but many other ones were very successful back then.

Several very successful classic games and important gaming platforms released or blossomed between 1983-1985 with microcomputers like C64, MSX (Sony and MS gaming platform debut, also made games for it), Commodore Amiga and consoles like NES and Master System, and also some very important gaming companies started or became popular in 1983-1985 like Capcom, just to name one as an example.

That 83-85 was a difficult generational transition as other ones like the 77-78 one or the 94-95 one (PSX/jump to 3D), 2009-2011 (PS3 struggle). But in the 83-85 there was the foundational period where there were released the main consoles and computers that defined today's home videogame market.

But more than a 83 crash it was a very rare 78-82 spike due to several super huge hits being released there (specially Space Invaders and Pac-Man but also Galaxian, Asteroids, Centipede, Tempest etc) and also the Atari 2600 being specially popular during that period in the USA (in EU and Asia was released in 1982, 1983 or later depending on the country).

Bloomberg-revenue-history.png

50-years-of-gaming-revenue.png

hSHDyoH.png


We have these US centric graphs, but they don't include the huge gray market of arcade and console clones and bootlegs that was pretty huge in Europe and Asia during the 80s, because the original ones were too expensive, back then wasn't a globalized world with internet as today so it was more difficult to control the copyright stuff and also the shipments and so on were difficult and expensive so many small local companies made their own (many times unlicensed clones or bootlegs) arcade versions of foreign games. There were also many small -but some of them very successful- companies in Europe who also made their own arcade or computer games that I highly doubt would be included here because even here in Spain we didn't track them and we're researching them today.

In places like here in Europe back in the '80s we didn't have gaming market specialized analysis firms, big gaming industry publishers or developer associations and many countries even didn't know how big their internal gaming market was.

They opened the floodgates & Nintendo saved the industry.
No, back then the gaming market was mostly arcades and microcomputers like Apple II, Commodore 64 (released in 1982, 12-17M units sold), MSX, Amstrad CPC, ZX Spectrum, Commodore Amiga, etc. After several failures in the console market, Nintendo released the NES in Japan in 1983, 1985 in NA and 1986 in some EU countries (in other EU countries like Spain was released later and wasn't as successful as its clones). Until then Nintendo had been very successful in the arcades with Donkey Kong and not that much with other games.

And it's been crashing ever since, good that we have Phil to undo this great wrong!
No, the yearly gaming market revenue has been in a growing trend since then. See the graphs above.
 
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SmokedMeat

Gamer™
Yes they did after Activision was created the market was flooded with other 3rd parties making low quality games for a quick buck

Ok? We have that today. The PC market had loads of third parties as well, yet the crash only affected the console market.

Some of those third parties like Parker Bros and Imagic put out popular games. Mattel was even putting their Intellivision games on Atari. we actually got some great games thanks to third parties.

Edit: I see the “Game Historian” who did the video is a young kid, who wasn’t even around back then. I knew that was going to be the case before I looked.
 
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onQ123

Member
You just now finding out about this old news?
No but it's interesting that Activision was a big part of the 3rd Parties becoming a thing now they are going back under the 1st party umbrella.

A few guys left Atari started Activision became way bigger than Atari & Atari as a console maker died now Activision is being bought out by another console maker.
 

onQ123

Member
Ok? We have that today. The PC market had loads of third parties as well, yet the crash only affected the console market.

Some of those third parties like Parker Bros and Imagic put out popular games. Mattel was even putting their Intellivision games on Atari. we actually got some great games thanks to third parties.

Edit: I see the “Game Historian” who did the video is a young kid, who wasn’t even around back then. I knew that was going to be the case before I looked.
I didn't find that video until after I posted the thread . The video is for those who would rather watch than read.
 

Clear

CliffyB's Cock Holster
This is incorrect. The primary cause of the crash was that every major toy manufacturer tried to jump in on the trend for home gaming, leading to a massive bubble in the perceived value of the market. The crash itself being precipitated by Atari making outlandish projections for sales despite the 2600 being well past its prime and massively overproducing carts, particularly E.T. carts.

When the bubble burst with the perceived market leader (Atari) taking huge losses, all the other contenders lost confidence and abandoned or scaled back their efforts in the space. Activision's input was seen as instrumental in that they were producing unlicensed carts based on reverse engineered hardware, but ultimately it was the staggering incompetence of Atari generally that sealed their fate.

If there ever is another "great crash" (monumentally unlikely as the business is way more globalized, with the events of 1983 only really impacting the US) it won't bear any resemblance causally to what happened back them.

Anyone who argues otherwise, or simply raises the spectre of 1983 as a potential "warning to the future" has unequivocally no idea what they are talking about. Its practically a litmus test for base ignorance of the history of the business.
 
Microsoft buying Activision / Blizzard / King, won't make a dent in the amount of Publishers there are for Mobile and how much money Mobile brings in. Microsoft will never have a monopoly on the market. The market is vast and diverse and it's not just made up of Nintendo, Sony, and Microsoft. Even home consoles when you consider Apple, nVidia and Amazon all have horses in this race. Streaming or not.
 
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Futurematic

Member
Jack Tramiel running Commodore’s insane price war against the industry was another key factor. Why buy a console when a full C64 computer with tons of games was nearly the same price.
 
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A.Romero

Member
I really don't understand why people are so concerned about this acquisition. Even if Sony loses access to CoD, how long until someone fills up the vacuum left by its departure?

People that still want to play CoD can still do it, they just need to buy a different console or even just pay for their favorite streaming service and play it.

I guess I'm having difficulties understanding because I'm not an Activision fan.
 

Clear

CliffyB's Cock Holster
I really don't understand why people are so concerned about this acquisition. Even if Sony loses access to CoD, how long until someone fills up the vacuum left by its departure?

The concern is that its going to result in further mergers, with the entire AAA space ending up balkanized. Basically if a deal worth $70b goes through, everything and everyone is up for grabs.
 
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A.Romero

Member
The concern is that its going to result in further mergers, with the entire AAA space ending up balkanized.

I see.

People are fearing for the publishers they usually complain about? (I'm thinking CDPR, Square, EA and Ubisoft). Who else is out there who is making AAA multiplatform and paying themselves?
 

Havoc2049

Member
There was a bunch of factors that contributed to the downfall of the industry leader Atari and the video game crash of late 1983/84. Atari was getting hit in every market they were involved in. The arcade market was also contracting. Commodore bought MOS and was able to aggressively price the C64 and to make matters worse, Texas Instruments dumped/liquidated their TI-99/4A computers onto the market at $99, leading to losses in the Atari computer division, as they tried to price match. Atari also didn't have the systems/infrastructure in place to control the VCS/2600 market and retailers over ordered product and the market became flodded.

Activision made some great games back then. I bought my 2600 in 1982 (well my parents bought it for me) and Pitfall was the first game that I bought. The output by Atari (silver label games), Activision, Parker Brothers, Imagic and a few other companies in 1982 and 1983 was great. 1984 had a couple of bangers by Atari and Activision on the 2600 and you could get liquidated games for dirt cheap, which was cool at first, but new game releases came to a crawl and as a gamer, I moved on to the 8/16 computer market, which was still getting cutting edge new games. Companies like Activision, Electronic Arts, Infocom, Lucasfilm Games, Epyx, Microprose, SSI, Sierra, Datasoft, etc., made some amazing computer games in the 80's.
 
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onQ123

Member
There was a bunch of factors that contributed to the downfall of the industry leader Atari and the video game crash of late 1983/84. Atari was getting hit in every market they were involved in. The arcade market was also contracting. Commodore bought MOS and was able to aggressively price the C64 and to make matters worse, Texas Instruments dumped/liquidated their TI-99/4A computers onto the market at $99, leading to losses in the Atari computer division, as they tried to price match. Atari also didn't have the systems/infrastructure in place to control the VCS/2600 market and retailers over ordered product and the market became flodded.

Activision made some great games back then. I bought my 2600 in 1982 (well my parents bought it for me) and Pitfall was the first game that I bought. The output by Atari (silver label games), Activision, Parker Brothers, Imagic and a few other companies in 1982 and 1983 was great. 1984 had a couple of bangers by Atari and Activision on the 2600 and you could get liquidated games for dirt cheap, which was cool at first, but new game releases came to a crawl and as a gamer, I moved on to the 8/16 computer market, which was still getting cutting edge new games.
Yeah Activision wasn't the problem it was the floodgates that they opened & companies that didn't give a damn about video games jumped in just to cash in on the market
 
Everyone gets this wrong, the gaming historian is also constantly being checked for his inaccuracies. (also lol wiki)

How can Activision cause a crash when third parties having glut of unsold stock was a RESULT of the crash not the cause?

How can we have an internet with access to documentation and people still get this wrong?

PRICE WARS caused the crash. There was no stores filled with bargain bins of games until after the implosion from the PRICE WAR because those companies went under and retailers were stuck with the stock, so they sold them at a discount which mean gamers were buying 5 games for $10 instead of 1 for $60 for example, which forced game companies who wanted to survive with few exceptions, to lower the price.

The consoles also had to lower the price because computers (which started the price war) also dropped in price their hardware and software, which is one of the reasons why Atari could not keep the 5200 going to they removed it early before the industry even crashed properly. Coleco survived because they didn't go too low and they had a selling point to keep sales flowing. Unfortunately, there bad execution and timing with the Coleco Adam computer almost eradicated their electronics apartment so they switched full-time to dolls despite CV still selling because they lose a crap ton on Adam.

The Pacman and ET thing are still made up added on years after the fact by taking some articles and repeating them over and over again going with the landfill myth which was said to be for E.T. when the landfill already existed before the crash and was used for defective and excess product across all of Atari. Despite all the books and people still alive providing the information the story still has not changed because certain groups of gaming journalists grew up with the fairly godmother fable and don't want it to leave because that would take away probably the biggest narrative surrounding one particular company and console that came out after the "crash".

Third parties had nothing to do with the crash. It was only the console market that crashed.

Mostly yes, Price wars, though games had to also eventually drop in rice to in the price wars.

Jack Tramiel running Commodore’s insane price war against the industry was another key factor. Why buy a console when a full C64 computer with tons of games was nearly the same price.

It was THE factor because it caused consoles to drop in price to avoid that which then spread to software. 5200 was pulled out of the crash for that reason because Atari was losing money and teamed up with a third-party for a replacement that was stronger but cheaper to produce and wouldn't hurt their bottom line.

This is incorrect. The primary cause of the crash was that every major toy manufacturer tried to jump in on the trend for home gaming, leading to a massive bubble in the perceived value of the market. The crash itself being precipitated by Atari making outlandish projections for sales despite the 2600 being well past its prime and massively overproducing carts, particularly E.T. carts.

98% incorrect.

Also most of Atari's losses weren't even in consoles, it was in home computers, they never made a dime, losing hundreds of millions a year.

Yes they did after Activision was created the market was flooded with other 3rd parties making low quality games for a quick buck

Wikipedia historian OnQ.

They opened the floodgates & Nintendo saved the industry.

Which never happened. Industry wasn't dead, new games coming out, new consoles, Atari was already producing to come back with 2 machines and to sell remaining stock of 5200, Coleco eventually left because of the Adam damage by CV was still selling until later 1985, in 1986 Atari 2600 which was remolded sold close to what the NES sold, even more so if 7800 combined, with less retailers carrying it and the Sega Master system, which had sold more than the 7800 but the 7800 sold out all Atari was able to produce while Sega had hundreds of thousands of consoles sitting on the shelves, and Atari kept selling well until Nintendo basically strong armed marketing companies, investment partners, and retailers to basically stop carrying the other two consoles by 1988. Which is one of the reasons why Atari went out to buy retail space, and Sega partnered with Tonka.

In addition, the "saved gaming" was a myth propagated by people outside the industry because of NES success along with the industry growing back in revenue (money) but that wasn't what the actual experts were saying, they were saying NES was leading in generating revenue, most of it, with it's NES. Not that the concept of "gaming" was dead, near dead, or coming back from ashes since millions were still buying and playing games (although some places did pull back but that happened during the middle of the NES boom too in several regions and with arcades, but it wasn't the ghost town people want you to believe) it was about money.

Atari was selling strong with demand for both of their consoles (and initially with the Xegs which sold out its production) from 1986 to 1988 (on a decline as Nintendo pushed Atari and Sega out of the market until in 89 when Sega would jump back in themselves with arcade revenue to push the Genesis without a partner) but was not bringing in half of the revenue the NES was. This is because the NES cost more, the accessories cost more, partnering with them cost more, and the games cost more.

If you were to take total US sales from 19-86 to the end of their peak in 1989, and then hypothetically said Atari 2600jr+7800 sold double that number, the NES would still be over 5x leader in bringing in money for the industry because of the costs. Atari was aiming to be accessible for profit, they weren't being aggressive to compete either once they were being pushed out of potential partners and retailers (outside the first year debatably) they instead wanted to sell many consoles, but at a profit, not to beat the NES. Yeah they were competing, but they weren't competing to win, which is why they had no issue with having 3 consoles on the market after 1987.

Outside of Sega finding away to stop Nintendos strong arming and bullying tactics (not likely given how much more money and connections Nintendo had, making those deals since before the test launch in 1985) and selling as much or more than the NES, there was never going to be a time, even if Atari ended up winning by 5 million units of Nintendos final number, even 10 million, that NES was not still going to be the number one revenue bringer in the industry. That is what the original "restore the market" analyst came from, which was converted to "gaming is dead they saved gaming" which isn't what was intended.

But by doing so some games that really weren't that special, or at least not as important as some claim they are, ended up being legendary, including some of the mixed reception games on the system. Because of the belief without it there would be no gaming. That myth hit so hard people even forgot home computers existed for years and just omitted them until C64 fans in the late 90s came online and you saw C64 vs. NES stuff, but that didn't make things better because people forgot about the Amiga which was an actual contemporary of the NES, not the C64, although the C64 does show how weak game consoles were at that time to even compare. I mean 7800 was 84, NES without chips was 83, SMS was 85 but based on a system from 83.

leading to losses in the Atari computer division, as they tried to price match.

Atari's computer division never made a single dime it's entire existence, them participating in the price war was the dumbest decision ever, and the reason and they should have avoided it as much as possible like Apple and TRS/Radioshack did. Atari computers only made money when Atari was brought out and became Atari corp with the ST.

While yes, that price matching accelerated their losses and probably contributed to the couple billion or so losses the computers division suffered in its existence until 1984 buyout, you have an implication here they were making money before then. they weren't.

Honestly, I think another big myth in gaming history was that Atari was a well-run company. it wasn't, never was until Ironically, the first version of it fell apart, and got replaced by Atari Corporation. Warner was also run but idiots who didn't understand or bother to try to understand the market. Jaguar and Falcon aside, Atari Corp was the only Atari that has real strategy and was generally run well in comparison.
 
I really don't understand why people are so concerned about this acquisition. Even if Sony loses access to CoD, how long until someone fills up the vacuum left by its departure?

People that still want to play CoD can still do it, they just need to buy a different console or even just pay for their favorite streaming service and play it.

I guess I'm having difficulties understanding because I'm not an Activision fan.

There have been many big FPS selling well and moving consoles. This belief COD is end all or not is very strange to me. Yes, it's the most successful FPS, yes on consoles it's the best selling and among the best selling franchises ever everywhere, but it's not a monopoly. There are other great selling FPS, and there can be new ones too.

Microsoft buying Activision / Blizzard / King, won't make a dent in the amount of Publishers there are for Mobile and how much money Mobile brings in. Microsoft will never have a monopoly on the market. The market is vast and diverse and it's not just made up of Nintendo, Sony, and Microsoft. Even home consoles when you consider Apple, nVidia and Amazon all have horses in this race. Streaming or not.

I don't even think King is top 3 anymore. Yes, they are huge and MS having them will help them enter in, but they would still have to follow-up to compete with other big mobile companies, and there are many raking in millions and billions.

The concern is that its going to result in further mergers, with the entire AAA space ending up balkanized. Basically if a deal worth $70b goes through, everything and everyone is up for grabs.

After all the trouble with this one and because of the time length, regulators learning more about the industry, I doubt there will be further mergers after this one if it goes through.

Why can’t people understand that this is not just about Call of Duty? It’s something that affects Sony’s business greatly, but Microsoft getting Activision will affect the entire industry in a very bad way.

So why with Activision, but not with Zenimax?
 

Trogdor1123

Gold Member
Why can’t people understand that this is not just about Call of Duty? It’s something that affects Sony’s business greatly, but Microsoft getting Activision will affect the entire industry in a very bad way.
Ok, how? Specifically
 

SmokedMeat

Gamer™
PRICE WARS caused the crash. There was no stores filled with bargain bins of games until after the implosion from the PRICE WAR because those companies went under and retailers were stuck with the stock, so they sold them at a discount which mean gamers were buying 5 games for $10 instead of 1 for $60 for example, which forced game companies who wanted to survive with few exceptions, to lower the price.

Mostly yes, Price wars, though games had to also eventually drop in rice to in the price wars.

This is interesting.

I don’t recall a price war, but I also wasn’t old enough to where I would’ve known as I was just a kid.

While going through the basement at my parent’s house several years ago, I found some old circulars that were used to wrap fragile items. I found some old retail circulars of Atari games, and to my shock they were $50 for new releases.

My only other personal experiences was getting Pac-Man for $30 and River Raid and Kaboom being on sale for $20.
I was also at a retailer back when they must’ve bought up loads of stock if other retailer’s unwanted Atari games. No boxes, just manuals and cartridges in bags, and they were cheap as well. That was at the time of the crash.
 
This is interesting.

I don’t recall a price war, but I also wasn’t old enough to where I would’ve known as I was just a kid.

While going through the basement at my parent’s house several years ago, I found some old circulars that were used to wrap fragile items. I found some old retail circulars of Atari games, and to my shock they were $50 for new releases.

My only other personal experiences was getting Pac-Man for $30 and River Raid and Kaboom being on sale for $20.
I was also at a retailer back when they must’ve bought up loads of stock if other retailer’s unwanted Atari games. No boxes, just manuals and cartridges in bags, and they were cheap as well. That was at the time of the crash.
Oh yeah, this is why back in the day you were lucky to get 2 games a year and for me it was on Christmas. A game my parents would buy and the money I got for Christmas would buy the other one. Only because there was no way in hell my parents were gonna buy me a $50 video game for my birthday in 1983.
 

Mokus

Member
It wasn't Activision fault that other companies flooded the market with bad games. Activision actually had talented game developers for the Atari 2600.
 

Evil Calvin

Afraid of Boobs
It wasn't Activision fault that other companies flooded the market with bad games. Activision actually had talented game developers for the Atari 2600.
Yep! Actually the Activision games were great quality and fun. Much better than Atari's own output actually.

The market was flooded with crap in the mid 80's.......Activision games were not the cause.
 

onQ123

Member
It wasn't Activision fault that other companies flooded the market with bad games. Activision actually had talented game developers for the Atari 2600.
They hated that other companies did that but they was the reason that the other companies was allowed to do so.

Even crazier after Nintendo came along & saved the industry with the seal of approval thing that kept the bad games out it was Atari ( who had tried to block Activision from being able to make 3rd party games for Atari ) that was trying to do the same thing to Nintendo because they didn't want to have to go through Nintendo to sale NES games 😂
 

Patrick S.

Banned
This is interesting.

I don’t recall a price war, but I also wasn’t old enough to where I would’ve known as I was just a kid.

While going through the basement at my parent’s house several years ago, I found some old circulars that were used to wrap fragile items. I found some old retail circulars of Atari games, and to my shock they were $50 for new releases.

My only other personal experiences was getting Pac-Man for $30 and River Raid and Kaboom being on sale for $20.
I was also at a retailer back when they must’ve bought up loads of stock if other retailer’s unwanted Atari games. No boxes, just manuals and cartridges in bags, and they were cheap as well. That was at the time of the crash.
Back in Spain, I used to buy MSX games on cassete at the gas station, for the equivalent of €3. Meanwhile, stuff like Secret of Mana for Nintendo cost like the equivalent of €100. Later on, when we gamed on the Amiga, we just copied our stuff or bought copies on Sunday's flea markets for little more than the price of a blank floppy... yeah, growing up, I knew like two people with a console, but dozens upon dozens with personal computers of different brands.
 

Drizzlehell

Banned
Yeah, yeah, keep dreaming. There won't be another crash because today's market is just too established and too diverse to ever go away.
 

Clear

CliffyB's Cock Holster
This is interesting.

I don’t recall a price war, but I also wasn’t old enough to where I would’ve known as I was just a kid.

It wasn't a price war so much as the home computer boom basically creating a bigger and more accessible market for video-games and consoles not being able to keep up.

The Atari VCS had been around for a long time by 1982, and for most of that time only selling modestly because it was prohibitively expensive - especially with the late 70's being a period of economic recession.

By the time it reached an acceptable mass price-point it was already outdated, and as its offer as a game console was narrower in utility than a home computer, it really needed to be keenly priced.

The plain truth is that in 1983 if you wanted to play arcade games at home, consoles were a shitty deal. And this was a situation that was effectively made even worse by cartridges being an exceptionally expensive delivery format for developers, publishers and for consumers.
 

onQ123

Member
Yeah, yeah, keep dreaming. There won't be another crash because today's market is just too established and too diverse to ever go away.
LOL I remember people thinking the console market was going to crash because of Smartphones then when the Wii U flopped they thought it was happening until PS4 hit & broke records
 

RCU005

Member
So why with Activision, but not with Zenimax?

It’s because they have Zenimax. They are hoarding the entire industry. What’s next? Ubisoft? So now they own everything?

That’s why it’s a big issue. Having both Zenimax and Activision would make Microsoft able to influence the industry with prices, timing, exclusives and whatnot. They would be able to control the industry. That is why it’s so dangerous that they get the Activision deal.

The saddest part: they believe that, in the case of Call of Duty -for example- everyone will be willing to switch to Xbox just to play it. They think that everyone will prefer to play the games on Xbox. The reality is that even with Activision, they will still be in third place because their problem is their culture and their mismanagement of studios and the brand itself.
 
That’s why it’s a big issue. Having both Zenimax and Activision would make Microsoft able to influence the industry with prices, timing, exclusives and whatnot.

You mean like how Sony did with none of them pushing influence for $70 games?

The saddest part: they believe that, in the case of Call of Duty -for example- everyone will be willing to switch to Xbox just to play it.

Source?
 
It wasn't a price war so much as the home computer boom basically creating a bigger and more accessible market for video-games and consoles not being able to keep up.

It was literally a price war that went from computers, to consoles, which forced some makers to drop their prices, which also applies to software. Nintendo themselves when they were about to launch in 1986 even said themselves they would avoid price cutting conflicts to try and appeal to companies.

The Atari VCS had been around for a long time by 1982, and for most of that time only selling modestly because it was prohibitively expensive - especially with the late 70's being a period of economic recession.

By the time it reached an acceptable mass price-point it was already outdated, and as its offer as a game console was narrower in utility than a home computer, it really needed to be keenly priced.

2600 was already selling in the mainstream, 1982 is the peak, you're confusing mainstream sales for peak sales. Modestly is an understatement since it was more than 20 million by the end of 1985 so around half the sales would have been outside of 1982 of whatever final total it was then.

Anyway outdated is true, but that had no impact on its sales. Which were not modestly before 1982.

Retailers were pissed during the crash because no one had money. Companies were mad because they also weren't making money despite good sales. Then there were gaming companies that went under because they weren't making money, leaving a bunch of stock retailers had to deal with, so because they had no idea what they were doing sold them at firesale prices to get rid of stock, which people ran out to get over more expensive games, who had to at least reduce their sales in some capacity to stay competitive, which led to more companies not making money. This is where the glut of games game from. The crash already happened, the games themselves did not cause the crash, the price war and companies biting it did.

Remember Atari pulled the 5200 out ahead of time despite whatever it sold, and partnered with another company for the stronger 7800 specifically because it would be cheaper and easier to take a hit on to offer stronger hardware for a cheap price to compete with a cheaper product in the face of the cost cutting.

Atari were not making products before the 7800 (which they were only partially involved with) where there was much margin to have a price war with Commodore, or with Mattel. Which both had products that could handle the war much better without taking as much of a loss.

Again as I mentioned earlier, Atari was not a well run company.

Even crazier after Nintendo came along & saved the industry with the seal of approval

lol

This is interesting.

I don’t recall a price war, but I also wasn’t old enough to where I would’ve known as I was just a kid.

While going through the basement at my parent’s house several years ago, I found some old circulars that were used to wrap fragile items. I found some old retail circulars of Atari games, and to my shock they were $50 for new releases.

My only other personal experiences was getting Pac-Man for $30 and River Raid and Kaboom being on sale for $20.
I was also at a retailer back when they must’ve bought up loads of stock if other retailer’s unwanted Atari games. No boxes, just manuals and cartridges in bags, and they were cheap as well. That was at the time of the crash.

Sometimes more than $50, but that changed when they had to be sold at $20 and $30 to get moving or less.

Ok, how? Specifically

He has none. He's acting like the activision purchase is like Disney buying Viacom. It's not that big.
 
Everyone gets this wrong, the gaming historian is also constantly being checked for his inaccuracies. (also lol wiki)

How can Activision cause a crash when third parties having glut of unsold stock was a RESULT of the crash not the cause?

How can we have an internet with access to documentation and people still get this wrong?

PRICE WARS caused the crash. There was no stores filled with bargain bins of games until after the implosion from the PRICE WAR because those companies went under and retailers were stuck with the stock, so they sold them at a discount which mean gamers were buying 5 games for $10 instead of 1 for $60 for example, which forced game companies who wanted to survive with few exceptions, to lower the price.

The consoles also had to lower the price because computers (which started the price war) also dropped in price their hardware and software, which is one of the reasons why Atari could not keep the 5200 going to they removed it early before the industry even crashed properly. Coleco survived because they didn't go too low and they had a selling point to keep sales flowing. Unfortunately, there bad execution and timing with the Coleco Adam computer almost eradicated their electronics apartment so they switched full-time to dolls despite CV still selling because they lose a crap ton on Adam.

The Pacman and ET thing are still made up added on years after the fact by taking some articles and repeating them over and over again going with the landfill myth which was said to be for E.T. when the landfill already existed before the crash and was used for defective and excess product across all of Atari. Despite all the books and people still alive providing the information the story still has not changed because certain groups of gaming journalists grew up with the fairly godmother fable and don't want it to leave because that would take away probably the biggest narrative surrounding one particular company and console that came out after the "crash".



Mostly yes, Price wars, though games had to also eventually drop in rice to in the price wars.



It was THE factor because it caused consoles to drop in price to avoid that which then spread to software. 5200 was pulled out of the crash for that reason because Atari was losing money and teamed up with a third-party for a replacement that was stronger but cheaper to produce and wouldn't hurt their bottom line.



98% incorrect.

Also most of Atari's losses weren't even in consoles, it was in home computers, they never made a dime, losing hundreds of millions a year.



Wikipedia historian OnQ.



Which never happened. Industry wasn't dead, new games coming out, new consoles, Atari was already producing to come back with 2 machines and to sell remaining stock of 5200, Coleco eventually left because of the Adam damage by CV was still selling until later 1985, in 1986 Atari 2600 which was remolded sold close to what the NES sold, even more so if 7800 combined, with less retailers carrying it and the Sega Master system, which had sold more than the 7800 but the 7800 sold out all Atari was able to produce while Sega had hundreds of thousands of consoles sitting on the shelves, and Atari kept selling well until Nintendo basically strong armed marketing companies, investment partners, and retailers to basically stop carrying the other two consoles by 1988. Which is one of the reasons why Atari went out to buy retail space, and Sega partnered with Tonka.

In addition, the "saved gaming" was a myth propagated by people outside the industry because of NES success along with the industry growing back in revenue (money) but that wasn't what the actual experts were saying, they were saying NES was leading in generating revenue, most of it, with it's NES. Not that the concept of "gaming" was dead, near dead, or coming back from ashes since millions were still buying and playing games (although some places did pull back but that happened during the middle of the NES boom too in several regions and with arcades, but it wasn't the ghost town people want you to believe) it was about money.

Atari was selling strong with demand for both of their consoles (and initially with the Xegs which sold out its production) from 1986 to 1988 (on a decline as Nintendo pushed Atari and Sega out of the market until in 89 when Sega would jump back in themselves with arcade revenue to push the Genesis without a partner) but was not bringing in half of the revenue the NES was. This is because the NES cost more, the accessories cost more, partnering with them cost more, and the games cost more.

If you were to take total US sales from 19-86 to the end of their peak in 1989, and then hypothetically said Atari 2600jr+7800 sold double that number, the NES would still be over 5x leader in bringing in money for the industry because of the costs. Atari was aiming to be accessible for profit, they weren't being aggressive to compete either once they were being pushed out of potential partners and retailers (outside the first year debatably) they instead wanted to sell many consoles, but at a profit, not to beat the NES. Yeah they were competing, but they weren't competing to win, which is why they had no issue with having 3 consoles on the market after 1987.

Outside of Sega finding away to stop Nintendos strong arming and bullying tactics (not likely given how much more money and connections Nintendo had, making those deals since before the test launch in 1985) and selling as much or more than the NES, there was never going to be a time, even if Atari ended up winning by 5 million units of Nintendos final number, even 10 million, that NES was not still going to be the number one revenue bringer in the industry. That is what the original "restore the market" analyst came from, which was converted to "gaming is dead they saved gaming" which isn't what was intended.

But by doing so some games that really weren't that special, or at least not as important as some claim they are, ended up being legendary, including some of the mixed reception games on the system. Because of the belief without it there would be no gaming. That myth hit so hard people even forgot home computers existed for years and just omitted them until C64 fans in the late 90s came online and you saw C64 vs. NES stuff, but that didn't make things better because people forgot about the Amiga which was an actual contemporary of the NES, not the C64, although the C64 does show how weak game consoles were at that time to even compare. I mean 7800 was 84, NES without chips was 83, SMS was 85 but based on a system from 83.



Atari's computer division never made a single dime it's entire existence, them participating in the price war was the dumbest decision ever, and the reason and they should have avoided it as much as possible like Apple and TRS/Radioshack did. Atari computers only made money when Atari was brought out and became Atari corp with the ST.

While yes, that price matching accelerated their losses and probably contributed to the couple billion or so losses the computers division suffered in its existence until 1984 buyout, you have an implication here they were making money before then. they weren't.

Honestly, I think another big myth in gaming history was that Atari was a well-run company. it wasn't, never was until Ironically, the first version of it fell apart, and got replaced by Atari Corporation. Warner was also run but idiots who didn't understand or bother to try to understand the market. Jaguar and Falcon aside, Atari Corp was the only Atari that has real strategy and was generally run well in comparison.

I had a C64 before the NES. I loved the C64 too. But the C64 was no NES. Sure the SID chip was neat for its time, but its analog nature limited its scope a bit (sound effects, overreliance on arpeggios), and aside from sprite count, the NES has superior graphics dedicated hardware, not to mention the amount of games with little balance. I mean, the NES had its share of clunkers too in that department, but a ton of games on C64 made them look like Yoshi's Story.

There were games that were as good if not better than their NES counterparts on C64. But to say they NES was nothing special by comparison is more than a little contrarian.
 
There were games that were as good if not better than their NES counterparts on C64. But to say they NES was nothing special by comparison is more than a little contrarian.

You're completely misreading what I wrote.

You read where I said that C64 showed how weak game CONSOLES were at the time (not just NES) and stopped there and didn't look before or after that line form the looks of it,

C64 vs. NES stuff, but that didn't make things better because people forgot about the Amiga which was an actual contemporary of the NES, not the C64, although the C64 does show how weak game consoles were at that time to even compare.

Amiga was fare ahead of Sega, Atari, and Nintendo, too far i would argue. Those consoles were basically an extension of the previous hardware, not the jump that consoles needed. C64 and Atari 8-bit computers even being a subject of comparison shoed how weak those consoles were, which was my point. not that the C64 was stronger than the NES. Amiga came out in 1985, a year before the nationwide release of the NES in the US. C64 came out in 1982 based off 1980 parts.

I'm not saying NES should have been Amiga strong, but it should have been a bigger gap from the Colevovision (without cartridge chips) than it was. By the the end of NES first year in the US the PC Engine was out.
 

Clear

CliffyB's Cock Holster
It was literally a price war that went from computers, to consoles, which forced some makers to drop their prices, which also applies to software. Nintendo themselves when they were about to launch in 1986 even said themselves they would avoid price cutting conflicts to try and appeal to companies.

When someone says price war I kinda think of a battle in the same product category. Here its a case of people back in the early 80's deciding between getting a console or getting a home computer.

Once home computers entered the same price point, it was game over. Because the offer is just better and more broadly appealing.

Video game systems were a familiar concept at this point, but crucially they were considered toys or novelties. Expensive ones at that because the software wasn't cheap.

A home computer on the other hand, was kinda unprecedented, a tool as much as an entertainment product.

Once the idea of bedroom coding became widespread, and the fruits of that began to filter through to the market via small publishers (enabled by no longer having to deal the risk of manufacturing cartridges), consoles as they were understood at that point were done. Period.

Remember at this point there were no mascots, there were just approximations of arcade favourites. Consoles had branding to differentiate them but no real identity to speak of. So when people started to see clones or variations of these same arcade staples albeit usually under a new name on home computers, they were undercut every which way.

Until NIntendo came along and successfully reframed the idea of what a console is anyway! But even then I'd say that it took until some way into the 4th gen of consoles for them to really overtake the home computers in terms of being the perceived best way to play videogames outside of the arcades again.
 
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