My name is Ethan McLaughlin and today I’m going to talk to you about the North American Video Game Crash of 1983. For those who don’t know the Video Game crash also known as Atari Shock was a huge recession in the video game industry that occurred from 1983 to 1985. There were lots factors that went into causing this crash and I will discuss most of them in the following presentation.
Reason number one: Bad games.
Pac-Man is one of the most well-known and successful games ever and after the original arcade game was released in 1980 Atari acquired the rights to produce a version on their home console, the Atari 2600, at this time there were approximately 10 million 2600’s were regularly being used, with this knowledge Atari decided to produce 12 million copies of Pac-Man expecting that 2 million people would buy an Atari just to play the game. A man called Tod Frye was tasked with creating the game; development began in May of 1981. After a few months Frye had created a prototype for the game and he showed it to Atari, however, Atari wanting to capitalizeon the lucrative holiday season released the prototype. Once it was released it garnered mixed to negative reviews, however the game initially sold well, selling around 7 million copies but these sales eventually slowed down and Atari had to deal with the profit loss that came with over 5 million unsold copies. Another example of a game that did poorly was “E.T. the extra-terrestrial”. Atari acquired the rights to produce an adaption for the 2600, which getting the rights cost 20 million dollars alone. Similar to Pac Man Atari wanted the game to be ready for the Christmas period but development only begin in late July this meant that the developer had less than six weeks to create the game. Around 5 million copies of the game where produced and the game released in December 1982. Of those 5 million copies, 3.5 million came back returned or unsold.
Reason number Two: Loss of publishing control.
In 1979 several programmers left Atari and created Activision, which became the first third party developer, many other companies followed suit and soon lots of developers and publisher’s independent form Atari and other companies were putting their games on shop shelves. With the less of publishing control Atari and other video game companies could not have good quality control for the games that would be on their consoles, this caused poorly made, derivative games to flood the market.
Reason number three: Flooded Console market.
Over the last several console generations there have been only three competitors in the home console market, a console from Sony, Microsoft and Nintendo for example this generation; there is the Xbox One, PS4 and the Wii U. However during the 80’s there was lots of consoles on the market like the Atari 2600, the 5200, ColecoVision, Odyssey 2, Intellevision, Vectrex, tandyvision, tele-games system, Fairchild channel F system 2 to name a few. Each one of these consoles had there now library of games, many of which from third party developers. This meant that consumers had a lot of choice but not enough information and a lot of people ended up not buying any consoles at all.
Reason number four: Competition from PC’s
Computers had better visuals and sound compared to home consoles, this combined with the ability to do things like accounting and word processing and a their reasonable price made home computers a better investment than a console therefore consoles were beginning to less and less.
These contributing factors all lead to 97 percent drop in revenue for the video game industry, from 3.2 billion dollars in 1983 to approximately 100 million dollars in 1985
Conclusion: The rise of Nintendo
Now some of you are probably wondering how the western game market recovered? And the answer is Nintendo. After the NES or the Nintendo Entertainment System was released the industry began to recover and by 1988, revenues were over 2.3 billion dollars. One of the biggest reasons for Nintendo’s success was their stance on the third party games, in 1986 Nintendo’s then president, Hiroshi Yamauchi stated, “Atari collapsed because they gave too much freedom to third-party developers and the market was swamped with rubbish games” because of this, Nintendo limited the number of games that third party developers could release and also put its “Seal of Quality” on products that met their standards. Another reason for Nintendo’s success was their stellar first party line up with games like “Super Mario Bros.” and “The Legend of Zelda” becoming instant classics and being regarded as some of the best games ever made.
I hope you have enjoyed my brief history of the video game crash of 1983. Thank you for watching.
Considering my piece will be myself on a green screen there isn’t much opportunity for other shots, other than cutaways. My presentation will be me talking directly to camera with cutaways throughout.
Shot 1: Mid shot of myself in front of a green screen