The Ultimate History of Video Games: From Pong to Pokémon and Beyond—The Story Behind the Craze That Touched Our Lives and Changed the World (12 page)

In an effort to stay ahead, Atari entered 1974 producing a new game every other month. Bushnell’s new strategy allowed the competition to copy games, and Atari retaliated by coming out with new ones.

The problem was that, like everyone else, Atari was still basing its entire library on remakes of
Pong.
Other companies made paddle-ball games based on sports—
Handball
(
Pong
in a three-walled court) and
Hockey
(
Pong
with small goals and two paddles). Atari released
Pin Pong, Dr. Pong, Pong Doubles
, and
QuadraPong.

In the end, the Grass Valley think tank came up with the solution. In 1974, Mayer and Emmons began designing the first racing game. Later named
Trak 10
, the racing simulation was every bit as primitive as
Pong.
Players used a wobbly steering wheel to control a boxy-looking car as it sped around an oval track.

Although
Trak 10
had very basic graphics, it opened the gates for a flood of creative new ideas. One of Atari’s next titles was
Gotcha
, a game in which a player with a box chased a player with an X through a maze.
Gotcha
received only a lukewarm reception from arcade owners, though. In later years, maze chases would become one of the most popular themes in video games.

Even though it proved unsuccessful in the arcades, Bushnell was always sentimental about
Gotcha.
His role in the company quickly shifted after that, as Bushnell became more involved in management than game design. More than a year passed before he came up with another design.

While other companies remained bogged down with electronic ping-pong and tennis, Atari came out with its second game—
Space Race
, a game in which players dodged asteroids as they flew tiny spaceships across a screen. The game did poorly, and Bushnell decided to return to the safety of tennis games.

Within a few years, however, Atari experimented with new themes—
Steeple Chase
, a multiplayer game in which players jumped horses over gates on a treadmill race track; and
Stunt Cycle
, a game in which players jumped buses—capitalizing on real-life stunt man Evel Knievel’s wave of popularity.

Atari established itself as the most diverse and prolific coin-operated video game company in history. The company developed an unwritten manifesto that did not allow designers to make games that had been done before. This legacy of innovation lasted more than a decade.

Though Atari was the first company to look beyond
Pong
for inspiration, other companies soon followed. In 1975, the movie
Jaws
, a story of a man-eating great white shark terrorizing a tourist town, set box-office earnings records and launched the nation into a frenzy. Beach resorts reported that tourists were afraid to go swimming, sometimes even in pools. The company Project Support Engineers (PSE) attempted to capitalize on shark mania with a game called
Maneater.

Maneater
was a shark-hunting game housed in a fiberglass cabinet shaped like the head of a shark. The distinctive cabinet made the game expensive to manufacture. Though the idea of hunting sharks initially attracted players, the game’s unexciting play did not attract repeat customers.

In 1975, Midway, one of the companies that originally rejected
Pong
, emerged as Atari’s closest competitor. Midway and Atari were very different organizations. While Atari had an established research and development department, Midway distributed games developed by other companies.

Gunfight
, Midway’s first major video game hit, was a shoot-out in which two players controlled cowboys who shot at each other from opposite sides of the screen. It was not an original concept; a Japanese firm had created the game, then licensed it to Midway for the U.S. market. When Midway’s development team members first tested it, though, they found it less than entertaining. The graphics were blocky and the gunfighters’ movements were quite limited. To try and salvage the game, Midway hired an outside designer, David Nutting, brother of Nutting Associates founder Bill Nutting. (Nutting and Associates went out of business shortly after the failure of
Computer Space
, and Bill Nutting spent the next few years flying missionaries and relief supplies into impoverished African nations.) Dave Nutting went on to create such classic games as
Sea Wolf, Gorf, Wizard of Wor
, and
Baby Pac-Man.

While improving
Gunfight
, Nutting introduced new technology to the video-game market. The original game simply featured two cowboys shooting at each other. Nutting not only sharpened the graphics, he placed objects between the fighters. Sometimes cactus or stagecoaches appeared in the middle of the duel to add to the challenge. To power these changes, Nutting incorporated a microprocessor into the game’s design, making
Gunfight
the first video game with a microprocessor.

Gunfight
opened the way for Japan to enter the American video-game market.
Gunfight
was originally developed by a firm named Taito—the Japanese term for “Far East.” Taito and Midway worked together until 1979. Their final project earned so much money that Taito abandoned Midway and opened its own U.S. operation.

As Atari expanded its repertoire to include racing games, Nolan Bushnell and Gene Lipkin, vice president of sales, toured the country to find out what arcade owners and distributors thought about the future of video games. Lipkin, who had started in the business working for the Florida firm Allied Leisure, took Bushnell to have lunch with one of the most respected men in the amusement industry, Joel Hochberg, the New York City game technician who had moved to Philadelphia to manage an arcade-restaurant in 1961.

Hochberg moved to Florida to take a job working in a large amusement arcade owned by Mervin Sisken, the son of the man who brought him into the industry. They worked together for seven years, during which time Hochberg’s knowledge of the industry earned him a national reputation.

When Hochberg and Sisken split under unpleasant circumstances, Hochberg opened an under-funded arcade of his own. Unable to afford help, he worked 14-hour days, 7 days a week. Despite the long hours, his debts mounted. Just as it looked like he might have to close, the owners of Allied Leisure contacted him, suggesting an attractive partnership. Hochberg moved from maintaining equipment to sales and design.

It was during this time that Atari released
Pong.
Hochberg tried the new medium and was impressed. Two years later, Gene Lipkin invited him to lunch to meet Bushnell.

Though both Bushnell and Hochberg were in the same industry, they did not keep in touch with each other. Bushnell continued his tour, meeting with arcade owners and trying to satisfy his insecurity about the industry’s future.

Hochberg continued with Allied Leisure for a while and eventually started his own business again. By this time he had established international relationships, which soon fostered unique advantages in the amusement industry.

In another decade, Bushnell and Hochberg would trade places. Bushnell would become the established authority, while Hochberg became a famous maker of games.

Atari’s first years were filled with notable successes and important failures. When asked about the early years at Atari, Nolan Bushnell and those around him remembered the fun times, but they also recalled struggling to come up with new ideas. Bushnell’s constant drive to expand the business depleted Atari’s revenues, and growing competition cut into company profits.

Even in stressful situations, however, Atari’s corporate philosophy of smart work and hard partying continued. Atari executives still had hot tub meetings and Grass Valley parties, though partying did not alleviate their concern for the future. Bushnell spoke publicly of long-term interest in computer games, but he privately questioned whether Atari’s success had been the result of luck or skill. He knew he had outflanked the competition so far, but he
wondered which company would pose the next serious threat. He needed a scheme to maintain his advantage.

Keeping that advantage was of dire importance because of a unique set of dynamics within the amusement industry. In the early 1970s, most cities had two or three dominant vending-machine companies competing to do business in every arcade and bowling alley. These companies inevitably controlled the bulk of the location-based amusement routes.

In the early 1970s, an unstated rule within the industry mandated that vending companies serving the same area should not buy equipment from the same manufacturer. If, for instance, the largest distributor bought Bally pinball machines and Rock-Ola jukeboxes, its competitors needed to carry products from other manufacturers. Bushnell’s goal was to find some way to break that rule and sell equipment to competing distributors.

In 1974, Atari met that formidable competitor—a start-up company called Kee Games. Founded by Joe Keenan, Bushnell’s next-door neighbor, Kee Games was supposed to have lured away two of Atari’s “five princes”: Gil Williams, of manufacturing, and Steve Bristow, of engineering.

A bitter rivalry began as soon as Keenan announced his new company. In public, Bushnell tried to appear magnanimous. But confidentially, he floated rumors that Keenan and crew were renegades not to be trusted.

At one point, the rivalry became so bitter that Atari executives made accusations about industrial espionage:

For years, Bushnell refused to believe that Bristow would take such a risk for what amounted to little more than an elaborate ruse. Kee Games, as it turned out, was created by Atari, and Bushnell and Alcorn sat on its board of directors. Rather than chance a real rivalry with an established amusement manufacturer, Bushnell had created a controlled competitor.

The stories of industrial espionage and bad feelings were an elaborate cover that had taken on a life of its own. When Bristow had his wife distract the security guard and slipped into his old office, he simply added more reality to the myths about the competition between Kee Games and Atari.

Bushnell’s plan was to compete with himself, selling Atari products to the largest local distributors and Kee products to his competitors.

The strategy solidified Atari’s hold on the market. The only problem was that Kee Games became more dangerous than Bushnell anticipated. In 1974, while Atari’s research and development team was still focusing on
Pong
and racing games, Steve Bristow designed an innovative combat game named
Tank.