Consumer Electronics

Atari's Bankruptcy: Gen X Bids Pong Farewell


Atari's Bankruptcy: Gen X Bids Pong Farewell

Photograph by Joe Fox

Reading the news that Atari’s (ATA:FP) U.S. subsidiary is filing for bankruptcy was a little like hearing that Bob Hope died—in that you were surprised to discover he had been alive all that time.

Oh, Atari. Atari! Lodestar of my youth. If you’re too young to remember Atari’s heyday, back in the early 1980s, then you didn’t know that Atari was the jam. Let me put it to you this way—in ’75, two nerds named Steve went to work for Atari to develop a game called Breakout. They went on to start Apple (AAPL).

Back when Silicon Valley was basically Hewlett-Packard (HPQ) and Halted Specialties, Atari was like Willy Wonka’s chocolate factory. Magical products such as the vaunted 2600 home gaming system and games galore would come from there, captivating the attention of every 6- to 16-year-old from coast to coast. If you were really down with the action coming out of Sunnyvale, you sent $1 to Atari to join the Atari Club. (Of course I did this.) Membership did indeed have its privileges: You got a copy of Atari Age (the in-house magazine) every two months and you could—if your parents allowed—spend a week at an Atari computer camp. Atari computer camp! Hot summer days spent programming Atari PCs, competitive Frogger, and campfire songs about Qbert!

My parents never let me go. I’m still a little sore about that.

For all its power and influence, Atari’s run would prove to be tragically short. The Video Computer System, later called the Atari 2600, first hit stores in 1977. Growth was swift, with Atari’s then-parent, Warner Communications (TWX) (presaging Warner’s future dealmaking acumen with that other tech disaster, AOL (AOL)), selling millions of consoles and games in the years to come.

Unfortunately, the company was at the center of what Wikipedia grandly calls the North American video game crash of 1983—the post runs 2620 words, which tells you something about who writes Wikipedia entries—during which time a glut of consoles from competitors and mediocre games from everyone contributed to a rapid decline in sales. Stories are told of Atari having dumped tens of thousands of consoles and copies of its absolutely terrible E.T. video game into a landfill in New Mexico. Atari itself was later sold, gutted, and passed around from owner to owner in years hence. Atari’s founder, Nolan Bushnell, went on to create the Chuck E. Cheese chain of crappy pizza/video-game restaurants that use a rat as a mascot.

But in those heady Carter/early-Reagan days, Atari could do no wrong. As a testament to its impact, go watch Blade Runner. Shot in 1982 and set in 2019, the sci-fi classic has plenty of scenes in which Atari’s logo features prominently. Back then, if you were thinking about the future, it was impossible to imagine it without Atari.

Grobart is a senior writer for Bloomberg Businessweek and the managing editor of Bloomberg Digital Video. Follow him on Twitter @samgrobart.

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