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Copyright (c) 1996, 1997, 1998, 1999, 2000 Samuel N. Hart All Rights Reserved |
[ Second Generation / Main / Geekcomix / Mail Sam ] - Next Stop - Atari VCS/2600
The only barrier in Atari's path was money. The production facilities would have to be updated to allow for the manufacture of cartridges, and Atari, despite its dramatic growth in the previous years, lacked adequate resources to accomplish this on their own.
Nolan Bushnell started Atari when he was twenty-nine years old with $250 of his own money, and had sold the company for $28 million in four years. While no longer the president of Atari, Bushnell would remain on the Board of Directors for several years to come.
Sole licensing of Taito's arcade smash Space Invaders and the graphic refinements of an overnight success called Activision would propel the system's sales beyond any previous limits.12 Atari would even strike unprecedented deals with Paramount for exclusive rights for two of the biggest blockbuster movies of all time, E.T. and Raiders of the Lost Ark. Atari's success with the 2600 would continue for five more years during which time five billion dollars worth of Atari VCS/2600 systems and products would be sold.2
[ Second Generation / Main / Geekcomix / Mail Sam ] - Next Stop - Copyright (C) 1996-1997, Sam Hart, hart@geekcomix.com Some screen shots courtesy of Michael J. Novak Jr., and Video Game Advantage. | |||||
The success of
Atari in the late seventies would pave the way for Atari's domination of
the home market during the Second Generation. Because of a deal between
Atari and Sears, Atari had an 
In 1976, people
were ready for another form of entertainment. Record sales had plummeted
since the late sixties and early seventies, and many music companies were
struggling with this lack of interest. One such company was Warner Communications.
Steve Ross, the president of Warner, had been vacationing with his children
in Disneyland, when he discovered an eight player arcade game. Upon learning
that the unit sold for $4,500 and earned $250,000 a year for Atari, Ross
contacted Emanuel Gerard, whose job was to acquire properties for Warner.
Shortly thereafter, a contract was struck that seemed beneficial to all
parties involved. In reference to the deal, Cohen wrote, "Cash-rich
Warner was desperate for a hot new product, and product-rich Atari was
desperate for cash." 
Funded by Warner
Communication and distributed through Sears the VCS/2600 seemed destined
for success. Selling for $200, the unit's profit margins were small, but
the cartridges were being sold for $20-$40 yet only cost a fraction of
that to make.