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Introduction to ATARI, INC - Part 1


Starting with the ATARI 2600. In this video we learn about about the beginnings of ATARI, the false starts, the people behind it, and the launch of the ATARI VCS.

January 24, 2021

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On December 25th, 1981, at the age of six. My two brothers and I received an Atari VCS, along with three games. Asteroids, Space Invaders, and Superman… and apparently some boxing gloves. I remember being punched in the face a few times with those gloves, but mostly I remember spending a lot of time in front of the tv with my family… playing Atari.

Atari Inc, was founded in 1972, in Sunnyvale California by Nolan Bushnel and Ted Dabney. They first met while working at Ampex, an American electronics company in San Francisco, now known as Ampex Data Systems. It was there they bonded over their appreciation of the game Go, a strategy board game originating from China more than 2500 years ago, along with an interest in the more recent electronic games.

Bushnel and Dabney partnered together to develop a concept for a standalone computer with a monitor to play games on, and takes payment using an attached coin slot. The two partnered with Nutting Associates to manufacture the units, while they developed a game called Computer Space, based on the existing game Spacewar! This partnership with Nutting would ultimately fail due to disappointing sales having only sold 750 units of the 2300 produced.

Before leaving Nutting, the two started a new venture called the Syzygy Game Company, and began seeking out new partners, and soon found Bally Manufacturing, a pinball manufacturer. Showing interest in Bushnell and Dabney’s arcade games, Bally paid them $4000 a month for six months to design a new video game, and pinball machine. With their new investment they hired Allan Alcorn, another previous Ampex employee. Allan worked on a game using Dabney’s video circuit concepts, creating the game Pong, based on a tennis game which was included with the Magnavox Odyssey. It impressed the two so much, they wanted to offer the game to Bally, but first needed to incorporate the firm. Luckily Syzygy was already being used by another company in California, so they would need to choose something else, so they chose the word Atari, a word when used in the game Go, refers to a game piece or group of pieces which are in imminent danger.

Luckily the name Atari was not already used in California, which allowed them to incorporate on June 27th, 1972. With their freshly incorporated Atari, Inc., they offered to license the game Pong to Bally…and were rejected. So the pair created a test unit, installed it at a local tavern in Sunnyvale named Andy Capp’s, where the game proved itself to be very successful.

They quickly distributed ten more test units to local establishments and brought in on average $400 per week. In fact, the game was doing so well, when the bar owners complained about the machines malfunctioning, they opened them up to find the coin boxes were overflowing with quarters which shorted out the coin slot mechanism. With the great success of their test units, they once again approached Bally about licensing the game. However, once again they declined. Bushnell and Dabney offered the license to several other companies but to no avail.

The two decided that Atari would release Pong themselves. However, in 1973 Dabney left the company he co-founded due to a stressed relationship between the two, and after discovering that Bushnell had patented Dabney’s video circuit concept, excluded him as inventor.

In 1976, while developing the Atari VCS, Bushnell realized it would take a massive amount of money to bring the console to market, and eventually sold the company to Warner Communications for $28 million. This brought much needed capital into the company for the Atari VCS launch in August of 1977 The ATARI VCS was released on September 11, 1977.

With a retail price of $199 USD, the ATARI VCS sold 350,000 and 400,000 units during 1977, and 550,000 units in 1978. However, by 1979 The Atari VCS was the best-selling console of the holiday season, selling more than 1 million units.

The ATARI VCS was so successful in its early years that the word “Atari” was synonymous with video games in general. In the early 80’s, you didn’t tell your friends to come over to play video games, you asked them to come play ATARI.

Thanks for stopping by and learning a little bit about the early history of Atari, Inc. We’ll follow up in the future with more videos on the later years, as well as specific moments, and the technology behind the consoles. Specifically for now, the ATARI 2600. Join along by subscribing to the channel as we begin our journey to learn how the ATARI 2600 works, how to program for it, and to ultimately create a game.

I want to know your first memories of ATARI. Did you have a 2600, and what game do you remember playing over and over again? Comment below, I’d really be interested to know.

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