Read Replay: The History of Video Games Online
Authors: Tristan Donovan
The challenge to Atari’s control of the games released on its console started with a memo innocently sent by the company’s product marketing group to the game developers in the home console division. The memo detailed the sales figures for 2600 game cartridges and was meant to help the team understand what types of video game were most popular. But instead of inspiring more successful products, it sparked a rebellion. The hackles of the division’s game developers were already up when the memo landed on their desks. “The frustration began when Atari refused to pay a bonus program that was believed to be in place,” said David Crane, the programmer who had converted Atari’s bomb-dropping arcade game
Canyon Bomber
to the 2600. “Our department manager had negotiated a small royalty based on unit sales and when he later asked about that, he was asked ‘what royalty?’. To stop the grumbling, managers went through and gave raises to key employees, but a line had been crossed.” The product marketing group’s memo reopened the royalties issue. “The memo was a one-page list of the top 20 selling cartridges from the previous year, with their per cent of sales. The purpose of the memo was the hint: ‘These type of games are selling best…do more like these’. But this memo also showed us whose games did well, not just the game type. We noticed that four of the designers in a department of 30 were responsible for over 60 per cent of sales. And since we knew that Atari’s cartridge sales for the prior year was $100 million, it was a shock to know that four guys making $30,000 per year made the company $60 million.”
The four guys in question – Crane, Larry Kaplan, Alan Miller and Bob Whitehead – decided enough was enough and took the matter straight to Kassar. Miller put together a revised employment contract to present to Kassar, based on the kind of deals record labels gave their artists. “The four of us took this little sales statistic up to Kassar,” said Crane. “Our point was that the statistics showed we must be doing something better than others. Since a game is a creative product, it is possible that one person is more creative than another and, therefore should be compensated accordingly. We were told that ‘you are no more important to Atari than the guy on the assembly line who puts them together – without him we have no sales either’.”
Furious at Kassar’s dismissal of their arguments, the four quit Atari a few days later. With help from former music industry executive Jim Levy and $750,000 of venture capital investment the four rebels formed Activision, a company that would create and publish games for the 2600. It was a bold step. Until that moment only the manufacturers of video game consoles released the games. Indeed, Atari never even thought anyone else would make games for the 2600 and so had created nothing within the console that could prevent it. Activision’s founders had declared war on their former employer and set out to smash Atari’s monopoly on 2600 games. When Activision went public with its plans, Atari sued, hoping to crucify the fledging company and maintain its iron grip on the lucrative pool of 2600 owners it had spent millions cultivating. Atari’s legal challenge backfired. The court backed Activision and ruled that Atari had no right to stop others developing games for the 2600. In July 1980 Activision’s first three games – Crane’s
Fishing Derby
and
Dragster
plus Whitehead’s
Boxing
– reached the shelves packaged in distinctive boxes that prominently displayed the names of their creators.
Activision’s public promotion of each game’s creator addressed one of the main complaints of Atari’s programmers about their employer: the policy of keeping their names out of the public eye. “The fear was either that another company would try to steal them away or that the engineers would get an inflated sense of their worth and start making outrageous demands,” said Howard Delman, co-creator of
Lunar Lander
. The reasoning may have made sense to Atari’s management, but it angered its game developers who were starting to see themselves as the artistic pioneers of a new form of entertainment. The policy would prompt another of the company’s leading VCS 2600 developers to resign in late 1979.
Warren Robinett joined Atari in 1977 after completing a masters degree in computer science at Berkeley University, California. After completing
Slot Racers
, a car-themed remake of
Combat
, Robinett was searching around for an idea for his next game when he encountered Don Woods and Will Crowther’s text game
Adventure
. “I played
Adventure
at the Stanford Artificial Intelligence Lab in early 1978. My housemate Julius Smith was a grad student at Stanford and he took me up there,” said Robinett. “Crowther and Woods’ game took the nerd world by storm in 1978. I was just finishing
Slot Racers
then and needed to come up with an idea for my next game. The idea of exploration through a network of rooms, with useful objects you could find and bring with you and obstacles to get past, and monsters to fight – I thought this could work as a console game.”
The 2600’s limited capabilities and lack of a keyboard
ruled out a direct remake of the text game, so Robinett reworked the ideas into visual form. The turns-and-text original was transformed into an action game where players ran around the screen dodging and fighting monsters and finding objects to allow them to access new areas as they searched for an enchanted chalice.
[6]
Officially there were 29 rooms in Robinett’s
Adventure
, but, unknown to his colleagues, there were actually 30. The secret room was Robinett’s protest against Atari’s attempts to hide away its game creators. “Atari was keeping us game designers anonymous, which I found irritating,” he said.
To access the 30th room players had to discover a hidden
dot and use it in the right place to open an invisible doorway. Inside awaited the flashing words: ‘Created by Warren Robinett’. “Atari had the power to keep my name off the box, but I had the power to put it on screen,” he explained.
Adventure
’s concealed message was one of the earliest ‘easter eggs’ – a hidden secret within a video game for players who search carefully enough to discover.
[7]
Such secrets have since become a standard part of video games. Robinett was proud of his game. During its development, Atari’s management felt he was being too ambitious and tried to stop him working on it. Halfway through its development, his boss told him to turn it into a game to tie in with the Warner’s 1978
Superman
film. His colleague John Dunn stepped in and used a copy of the half-finished game to create the
Superman
game, so that Robinett could finish his game. When
Adventure
Robinett, however, had already quit by the time it came out: “I thought I had done a pretty good job in creating the
Adventure
cartridge and did not get the slightest bit of positive feedback when I completed it. My boss initially thought it was impossible to do and told me not to do it; when I went and did it anyway, he did not see this as a good thing. He told me I was ‘hard to direct’. When I told him I was quitting, he smiled. I guess I forgot to tell him that I had my name hidden in the final game code for
Adventure
that I had handed over to him.” Robinett went on to join educational software publisher The Learning Company, where in 1982 he would create
Rocky’s Boots
, one of the first successful educational games that taught Boolean logic using a puzzle game format.
* * *
Activision’s decision to muscle in on Atari’s console audience was well timed. Atari had released its
Space Invaders
cartridge a few months before the first Activision games arrived, causing 2600 sales to rocket. Activision’s clever marketing coupled high-quality games such as the bomb-catching action of
Kaboom!
and the jungle adventure
Pitfall!
soon gouged out a sizeable share of the multi-million dollar 2600 game cartridge market. In 1981 Activision had achieved sales of $6.3 million, in 1982 this soared to $66 million.
The public profile of their developers soared in tandem with sales, leaving the company snowed under by thousands of fan mail letters every week. “Publicising our names provided all of the positives of celebrity and none of the negatives,” said Crane. “I was never chased by the paparazzi but, in certain circles, there was pretty good name recognition. But the real thrill is hearing directly from a game player that your work touched them in some way. Because there was a name and a face behind the game, players were able to let me know directly how much they enjoyed playing my games.”
Other Atari employees took note of Activision’s success. Coin-op developers Howard Delman, Ed Rotberg and Roger Hector quit to form Videa in 1981 to make games for Atari and other arcade companies. “There was a lot of money being made in the industry, but the fraction coming to the engineers was small relative to the profits,” explained Delman. “It occurred to some of us that being a contractor to Atari, or any game company for that matter, could be far more lucrative than being an employee.”
That same year another group of employees from the home console division decided to follow Activision’s example. Backed with $2 million of venture capital, they founded Imagic on 17th July 1981 with the goal of publishing games for the 2600. Among the Imagic team was Rob Fulop, the author of the 2600 version of
Space Invaders
: “We were authors and we didn’t feel like authors at all. We weren’t compensated based on how good our work was perceived; our name wasn’t on the game. So we left. I wasn’t involved in getting the funding for Imagic; someone else did that and invited me to the party. It took me about two seconds to say yeah.”
Imagic’s debut game, Fulop’s
Galaxian
-inspired
Demon Attack
, became one of the best-selling 2600 games of 1982. Manny Gerard, the Warner executive responsible for overseeing Atari, felt the exodus of talent at that time was inevitable: “Entrepreneurial guys go off and that’s exactly what happened,” he said. “Guys see a way to make money and they run off and they build companies. Atari was getting bigger and it was not as entrepreneurial as it was. It happens. It’s the natural evolution of things.”
But Activision didn’t just inspire Atari employees to walk. It also encouraged companies unconnected to Atari to start releasing 2600 games, creating new rivals such as Quaker Oats’ U.S. Games division, Xonox and Fox Video Games.
Atari may have resented the companies seeking to grab a slice of what it regarded as its market, but their existence did little to damage the video game giant’s income. By 1982 Atari had become the single biggest business in the Warner Communications conglomerate. It had spent $75 million promoting its products in 1982, more than Coca-Cola and McDonald’s. Its sales were more than five times that of Warner’s film and music businesses and 70 per cent of Warner’s profits came from Atari. As a consequence Warner’s share price ballooned from just under $5 a share in 1976 to $63 in 1982. “We made more money than god,” said Noah Anglin, a manager in Atari’s coin-op division. “We made more money than Warner’s movie division. We went from being a mention in their corporate magazine to where we were their corporate magazine.”
And with cinema ticket and record sales being hit as teenagers swapped vinyl and the silver screen for the electronic thrills of the arcade, the video game looked unstoppable. In the 48 months since
Space Invaders
’ release, the video game had conquered North America. Its relentless ascent marked the biggest revolution in entertainment since the arrival of the TV set. And then, suddenly, everything fell apart.
[
1
].
Spacewar!
, for example, was created on a computer that had a vector graphics monitor.
[
2
]. The combat vehicle was built by the US military in response to the Soviet Union’s Boyevaya Mashina Pekhoty vehicles, which combined the features of light tanks with armoured personnel carriers.
[
3
]. The all-too-real threat of nuclear war between the US and USSR inspired Theurer, but Atari played down the atomic armageddon theme. Officially the game was about defending space bases on planet Zardon.
[
4
].
Pac-Man
was originally called
Puck-Man
and was released under that name in Japan. The game’s US distributor, Bally Midway, worried people might vandalise the cabinet and change the P to an F. So they renamed it
Pac-Man
– the name used for the game ever since.