Last time I left you with a nice image of a man dying from playing too many video games. Now we pick up in 1982.

Colecovision was released in early 1982, which had better graphics, sound, and the support of Nintendo, Sega, Konami and Universal.  Colecovision also had the ability to play Atari 2600 games. Atari 2600 began to lose support from the general populace.

Later in December of 1982 Atari announced that the sales of their consoles did not meet their expectations. The stock dropped 32% in one day.

Nintendo released the ever popular Family Computer, or Famicom, in Japan. Nintendo never intended to sell the Famicom outside of Japan so they offered the rights to Atari to distribute it. They signed an agreement to do so in June of 1982.

A controversy rose when everyone learned that Ray Kassar, the CEO of Atari, had sold almost $250,000 worth of stock the day before Warner Communications crashed. Kassar resigned and was replaced. During this time communications with Nintendo fell through and so did the deal to bring the Famicom to American shores.

During 1983 many third party publishers went bankrupt. They were unable to sell their inventory since there were cheaper games for sale and ended up withdrawing from the video game business.

Coleco made a last ditch attempt to make money during the video game crash. They released a product called Adam, which was the successor to Colecovision. 60% of the product was returned after it sold due to defective software.

Since the industry was falling apart, Nintendo announced plans to bring the Famicom over to American in 1984. The system wasn’t sold nationwide until 1986, but they sold limited amounts in New York as a test in 1985.

A Russian programmer named Alex Pajitnov invented the popular puzzle game, Tetris. It was a simple game that could be played on the majority of PCs at the time.

As noted above, the Nintendo Entertainment System, or NES (the Americanized version of the Famicon) was released nationwide in 1986. Along with it came competition. Sega released the Sega Master System, or SMS, in 1986 as well. Atari also came out with an upgraded version of the 2600, the 7200. Nintendo beat the pants off them all, outselling all its competitor ten to one. Several third party companies signed onto Nintendo, and companies like Konami and Namco began releasing their best games on the NES.

The toy company Tonka purchased the US distribution rights to Sega, selling it into more stores and therefore allowing it to compete better with Nintedo’s NES.

Atari tried to keep up with the succeeses of the other companies by re-releaseing and repackaging one of their old computers as a game console. The unit never sold well.
Coleco declared bankruptcy in 1988.

In 1989, Nintendo released their first handheld, the Ninteno Game Boy. It sold for 109$, and despite the fact that it had a tiny screen and no colors, it built a historic sales record.

Also in 1989 Sega released the first 16-bit console, the Sega Genesis. The early marketing efforts pushed the game to high success as an arcade console.

Atari also released their own handheld, with much less success than Ninteno’s Game Boy. It lacked the 3rd party support that Nintendo had, and rumors of Atari abandoning the console pushed consumers to buy the Game Boy instead.

Next we move onto the 90’s!