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What was the crash of 1983 like?


maxellnormalbias

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I think people noticed that video game console and software makers were going out of business left and right around 1984. Atari, Coleco (ColecoVision and don't forget the Adam), Mattel Intellivision, Activision, and many others all gone around the same time. I'm sure you could still find the stuff around, but everybody knew the companies backing them were defunct.

 

The C64 maintained popularity, and arcades were still around, but they became seedier and less ubiquitous and more stale. And yeah, you started seeing a couple of machines here and a couple of machines there in odd places (which was kind of cool actually, like finding treasure while out exploring the neighbourhood).

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Ahem, being old enough to remember, the real effect of the video game crash wasn't front and center for me until the middle of 1984. Atari Age the magazine ended publishing that year - new Atari titles, especially ones that were just announced like Stargate, Mario Bros, Pengo, etc. were suddenly hard to purchase and then toy stores were liquidating their stock of cartridges. I was fortunate to have gotten Pitfall 2 back then which I wanted for my birthday and was recently released. Either 1984 or 1985 I got a 1200XL. Acquiring any other game carts after that was done by mail order or garage sales. Video games really didn't come back until late 1987 when the NES came to the states.

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I remember seeing the NES at a friend's house in early 1986. Anyway, what never seems to be discussed, concerning its influence on the brief industry shake-out, is the mercenary pursuit of financial retribution for supposed violations of Baer's patents. The litigation cost every game company a lot of money. This surely played a hand in a few firms' decisions to stop manufacturing games.

 

Ralph Baer: After ten years of litigation in courts from Chicago to San Francisco, we collected many tens of millions of dollars. I spent a great deal of time working with our lawyers and testifying in court. The outcomes of all of our lawsuits were completely successful (for our side), and the infringers uniformly had to cough up large sums of money. At the same time, we (Magnavox under the Sanders patents) had well over a hundred patent licensees all over the world in the mid-seventies, and collected large amounts of license income from those licenses, also.

Steve Fulton: Was the patent on your videogames for play methods or for the hardware or both? Did it matter that the Atari products were digital and yours was analog?

Ralph Baer: We won our lawsuits because our patents covered both what is termed "means plus function," i.e. we showed in the patents and claimed the concepts of: the interaction of machine-controlled screen symbols (such as a ball) and player-controlled symbols (such as the player paddles), [which was] the "function." We also showed how this interaction could be accomplished -- the "means." Any game made by a manufacturer that exhibited the type of interaction defined by our patents was found to be infringing...and the judges in Federal District Courts and in the Court of Appeals all saw it that way.

 

(2005)

Edited by Chris++
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I remember seeing the NES at a friend's house in early 1986. Anyway, what never seems to be discussed, concerning its influence on the brief industry shake-out, is the mercenary pursuit of financial retribution for supposed violations of Baer's patents. The litigation cost every game company a lot of money. This surely played a hand in a few firms' decisions to stop manufacturing games.

 

Ralph Baer: After ten years of litigation in courts from Chicago to San Francisco, we collected many tens of millions of dollars. I spent a great deal of time working with our lawyers and testifying in court. The outcomes of all of our lawsuits were completely successful (for our side), and the infringers uniformly had to cough up large sums of money. At the same time, we (Magnavox under the Sanders patents) had well over a hundred patent licensees all over the world in the mid-seventies, and collected large amounts of license income from those licenses, also.

Steve Fulton: Was the patent on your videogames for play methods or for the hardware or both? Did it matter that the Atari products were digital and yours was analog?

Ralph Baer: We won our lawsuits because our patents covered both what is termed "means plus function," i.e. we showed in the patents and claimed the concepts of: the interaction of machine-controlled screen symbols (such as a ball) and player-controlled symbols (such as the player paddles), [which was] the "function." We also showed how this interaction could be accomplished -- the "means." Any game made by a manufacturer that exhibited the type of interaction defined by our patents was found to be infringing...and the judges in Federal District Courts and in the Court of Appeals all saw it that way.

 

(2005)

Not really. Those "tens of millions" were spread across lots and lots of companies in both coin and consumer over 1973 - 1983. And they were given different options for the licensing based either on one upfront sum or royalties based on earnings. Maganvox wasn't stupid, they'd rather get paid for a license over drowning a company in a license they couldn't afford, which is why they had those two options. I've never heard of any of these companies (or anyone at them) claim about going out of business for these relatively small payments compared to what most of these companies were making by the early 80s.

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In the UK, the crash didn't feel like a crash - but it was change. The change was the end of cartridge based systems and the start of the 8bit micro era. They were games machines masquerading as computers but it meant they sold under that branding.

 

It's why Nintendo realised they had to name their machine a Family Computer , later an entertainment system - and their ploy certainly did the trick as it relaunched the era of dedicated games systems.

Edited by davyK
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In the UK, the crash didn't feel like a crash - but it was change. The change was the end of cartridge based systems and the start of the 8bit micro era. They were games machines masquerading as computers but it meant they sold under that branding.

 

It's why Nintendo realised they had to name their machine a Family Computer , later an entertainment system - and their ploy certainly did the trick as it relaunched the era of dedicated games systems.

Though in the UK it was the SMS and the successful marketing of Virgin Mastertronic which relaunched that era after the 1984 crash, not Nintendo.

Edited by high voltage
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The C64 maintained popularity, and arcades were still around, but they became seedier and less ubiquitous and more stale. And yeah, you started seeing a couple of machines here and a couple of machines there in odd places (which was kind of cool actually, like finding treasure while out exploring the neighbourhood).

 

I observed the same things! C64 was wildly popular, as was the Apple ][ platform. Any and all computers that people could get their hands on really. The early to mid 80's hosted tons of great deals and blowout prices on stuff - which made its way into more homes than ever. What's always been so ironic about "the crash" to me is the fact sooooo many more people had computers/game systems in their homes during this time, thought it incredulous that some companies "gave up" producing or supporting such things. Those of us that had TI-99's BITD know exactly what I'm talking about here. Why dump a ton of hardware into the hands of willing consumers, only to cease supporting it right away *after* you knew how many units were sold?? From my vantage point at the time - seemed TI and the third party software companies *could* have continued to support the system better than they did, but simply chose not to.

 

And about arcade games popping up in strange places... absolutely. Started seeing them in the vestibules of stores even. Grocery stores, gas stations, record/music stores, convenience stores, rec centers, golf courses and bars are just a few of the places I remember seeing them crop up. Between the popularity of home computers and arcade machines, including pinball - the times were not bad for a so-called gaming "crash". ;)

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Though in the UK it was the SMS and the successful marketing of Virgin Mastertronic which relaunched that era after the 1984 crash, not Nintendo.

I know all about the SMS/NES market in the UK. The SMS is a splendid console but even the most ardent fan has to accept it did very little elsewhere. Nintendo went into the US and restarted the whole games console market in the largest consumer market in the world at the time. Which was no mean feat for a foreign company.

 

Are you from the UK too? Do you post on the retro video gamer forum? I find that raising the issue of the NES in the UK on that forum results in a lot of fiery responses.I never realised it annoyed so many people.

 

A bit off topic here - but with respect to the NES and SMS - I'm from N.Ireland and I can only relate my own experiences. While the SMS was dominant in the UK I was ignorant of the fact at the time. For some reason the choice was obvious to me. My friend had an SMS and there were nice games for it but the NES library attracted me more. I just don't remember noticing the SMS games in the shops all that much. I was a big Atari fan back then and was still smarting from the death of them and was a bit fed up with tape loading games on UK micros (had an Oric-1 and a CPC464). I had actually lost interest in gaming and the SMS and NES started me playing again. I've was on the Nintendo side of the fence when it came to Sega/Nintendo at the time (have of course since embraced both).

 

Back on topic - My post was about the naming of the Nintendo console as it was significant in a post crash environment - they had the computer hook in the name to try and get around the fear retailers had of video game systems after the crash when they were left with loads of unsold stock.

Edited by davyK
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I think the thing, that generates a lot of firey responses everytime the NES and the UK is brought up on forums, is'nt so much aimed at the hardware or it's games, more the way the UK Press has re-written the actual history of the hardware's impact in the UK, to 'suit' the advertising needs of Nintendo.

The NES was a fine console and played host to some superb games, that's not in question, it simply arrived far too late, games werre too pricey, most of'us' happy with our existing 8 Bit Micro's, planning to move onto ST/Amiga ASAP etc.
We were not sat here, systems unused waiting for Nintendo and the NES to 'save us' nor the UK Industry.
The NES had great coverage in likes of ACE, Mean Machines, TGM, C+VG etc etc, Turtles gave it a real shot in the arm etc, but when i used to read yet another tied in with advertising content...feature in Gamestm/RG etc about how fantastically well NES and it's games were recieved here, it just did'nt tie up with actual events, nor review scores from the press at the time.
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Nintendo are far from the only company to pull such stunts, Microprose used to create 'reviews' for advertising, System 3 put a ZZap 64 Sizzler rating on Flimbo's Quest, Sony has faked reviews etc they all do it.But it just annoys when you read in a UK publication an article that does'nt reflect the true events (and that goes for any platform) as it gives a false impression to a readership who might think because it's in a professional publication, it must be true.

 

 

Sorry to go off topic, but thought this might help clear up why NES in UK often generates heated debate on forums.The issue is the Press version of what happened, rather than anyone bringing the subject material up.

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Ah....Fair enough. I always wondered where the fire in people's belly came from on the subject....makes sense I suppose.

 

Is a certain UK retro magazine the source of irritation? I always considered that magazine to be more about enthusiasm than accuracy......although I enjoyed their ultimate guide articles about game series - Stuart Campbell always did a good job of those.

 

 

I always thought that the 8bit micros, the Atari XL and the Amiga were far more prevalent than any console in that era anyhow. I wasn't really aware of any proper console buzz in the UK until the Megadrive and SNES came along.

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At the time, in 1983, I had no idea there was a crash. Christmas of '83 (my first year in college) I worked in the video game booth at Toys 'R' Us, and business was booming that year. Arcades were plentiful, consoles were in all the major stores with huge displays that holiday season.

 

This continued well into '84. But then I started noticing the changes.

 

Even though there were articles in Electronic Games magazine (such as the one RT linked to) about the industry having problems, it didn't really click with me at first. Then Atari 7800 was hyped in one of their issues, and I was really looking forward to it (since I had passed on the 5200 and ColecoVision), but it failed to materialize (for years, as it would turn out). Then EG started covering personal computers more, and consoles less. Then they published less frequently. Games started hitting the bargain bins, and not just some of them, but games from every company. Ones I'd never seen before. And new games were becoming few and far-between. Fewer stores carried them (for awhile, you could even buy Activision games at 7-11). Announced games and other systems never materialized. The libraries for the 5200 and ColecoVision stagnated. Intellivision disappeared. The big displays became smaller. Then nonexistent. Then games started disappearing from the big department stores. This was all within a couple of years.

 

On the arcade front, there were still new games coming out (Marble Madness, I, Robot, Paperboy, Empire Strikes Back, Return of the Jedi, Gauntlet), but the quantity of new games had fallen off. Then smaller arcades started closing. Then the large arcades began carrying fewer games. Then they became smaller. Then they started closing. Some mall arcades were still around, but the days of a continual flow of cool new games was over and gone. The arcades that were left stagnated, and few people visited them anymore.

Arcade games had been everywhere for awhile - bowling alleys, laundromats, grocery stores, Sears, K-Mart, pizza places, 7-11, anyplace with a few extra square feet. But then those started disappearing. The few remaining ones were neglected and fell into disrepair. Or they were whatever junky, cheap conversion kit games were still available. Nothing new.

 

For me, the crash was a one-two punch. The home consoles died off, and the arcades died off about the same time. Of course, consoles bounced back eventually starting with the NES (which, incidentally, I resented at the time since I felt they had supplanted Atari's rightful role as the leader in video games, not knowing that Atari had effectively killed themselves), but arcades never did. In hindsight, I don't think arcades ever could have maintained their popularity. Besides the home consoles (and computers) catching up to and surpassing the quality of arcade games, I think that - at their peak - arcades were a social fad. They were an event of their time - like disco. They had an artificial popularity with people beyond those who were really just interested in playing video games, and that level of popularity was unsustainable (I wrote a blog entry about this nearly 10 years ago). Once the fad ebbed, coupled with the advances in home video games, arcades were just doomed. I don't think any changes in business practices could have saved them.

 

Anyway...

 

I never got into home computers at that time, so when the consoles and arcades went away, for me, so did video games. I never got into the NES (see my previous comment on resentment), and although I did buy a 7800 when it came out, the games for it were too few, largely unimpressive and already dated. Although I've owned several systems since, I never seriously got into buying games for another system ever again.

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At the time, in 1983, I had no idea there was a crash. Arcades were plentiful, consoles were in all the major stores with huge displays that holiday season.

 

This continued well into '84. But then I started noticing the changes.

 

Even though there were articles in Electronic Games magazine (such as the one RT linked to) about the industry having problems, it didn't really click with me at first. Then Atari 7800 was hyped in one of their issues, and I was really looking forward to it (since I had passed on the 5200 and ColecoVision), but it failed to materialize (for years, as it would turn out). Then EG started covering personal computers more, and consoles less. Then they published less frequently. Games started hitting the bargain bins, and not just some of them, but games from every company. Ones I'd never seen before. And new games were becoming few and far-between. Fewer stores carried them (for awhile, you could even buy Activision games at 7-11). Announced games and other systems never materialized. The libraries for the 5200 and ColecoVision stagnated. Intellivision disappeared. The big displays became smaller. Then nonexistent. Then games started disappearing from the big department stores. This was all within a couple of years.

 

On the arcade front, there were still new games coming out (Marble Madness, I, Robot, Paperboy, Empire Strikes Back, Return of the Jedi, Gauntlet), but the quantity of new games had fallen off. Then smaller arcades started closing. Then the large arcades began carrying fewer games. Then they became smaller. Then they started closing. Some mall arcades were still around, but the days of a continual flow of cool new games was over and gone. The arcades that were left stagnated, and few people visited them anymore.

Arcade games had been everywhere for awhile - bowling alleys, laundromats, grocery stores, Sears, K-Mart, pizza places, 7-11, anyplace with a few extra square feet. But then those started disappearing. The few remaining ones were neglected and fell into disrepair. Or they were whatever junky, cheap conversion kit games were still available.

 

This is exactly how I remember it happening too... right down to the letter.

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This is exactly how I remember it happening too... right down to the letter.

 

Me too. It wasn't a sudden thing, but a gradual transition. Many of us still had our computers to mess around with (I had a C-64 to go along with an Atari 2600 and ColecoVision), so even though the console side was eventually in shambles at retail, we didn't really miss much of a beat, though obviously the Crash affected every aspect of computers and videogames.

 

I also very much recall the excitement when the NES came out and started gaining traction. That really did invigorate things and was pretty much the right everything at the right time to get everyone excited about consoles again.

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I also very much recall the excitement when the NES came out and started gaining traction. That really did invigorate things and was pretty much the right everything at the right time to get everyone excited about consoles again.

Yeah, I worked in the security booth at Toys "Я" Us in 1987 (so I got to see a ton of games) and it seemed like the NES gave a boost to and influenced computer games. Another case of a rising tide lifting all boats. Not that there weren't fun computer games that a bunch of people were playing before the NES existed or became popular.

 

youtube.com/watch?v=EVueoteB6a0

https://www.youtube.com/watch?v=EVueoteB6a0

 

youtube.com/watch?v=Aju3KO81_YA

https://www.youtube.com/watch?v=Aju3KO81_YA

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By '83-'84 my family had moved on to the Commodore 64, so didn't really notice what was happening on the console side of things. If I noticed anything, it was that there were fewer video game ads in comic books.

 

I did notice arcades start vanishing though. Pretty much every mall in town, even the tiniest, rattiest strip mall had an arcade. Then over a few months almost all of them closed.

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In the UK, the crash didn't feel like a crash - but it was change. The change was the end of cartridge based systems and the start of the 8bit micro era. They were games machines masquerading as computers but it meant they sold under that branding.

 

This.

And girls.

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@davyK:I honestly would have to put RetroGamer Magazine, Edge and Gamestm into the same grouping as having eye rolled more than once over the years as a paying customer, after what's been presented as FACT, regarding the NES, Jaguar, MS, A8 etc etc.These days i only subscribe to Edge and that's more out of habbit.

 

Enthusiasm often does seem to be placed a lot higher than accuracy, but what % of the magazines in question readership really 'cares' for accuracy i have no idea.I'm quite a straight forward person-any magazine will get my money until it fails to meet standards i expect, cancelled sub to likes of Dreamwatch, Empire etc long before Gamestm, let alone RG.

 

 

The Rev? his articles by and by i've enjoyed, know his Metal Slug feature caused a few ripples and even as someone who's not a footy fan, i don't think he was the right person to do a feature on Kick Off for RG, but then i could say same about numerous articles/reviews in so many UK mags over the years.

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My low income, teenage self could afford to purchase a ColecoVision with Atari 2600 Expansion Module, an Intellivision II, and best of all I could afford the price slashed Vectrex!

I would still have all those if not for moving and deciding to stop paying on a storage unit, (but I do have the Vextrex and Expansion Module).

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@davyK:I honestly would have to put RetroGamer Magazine, Edge and Gamestm into the same grouping as having eye rolled more than once over the years as a paying customer, after what's been presented as FACT, regarding the NES, Jaguar, MS, A8 etc etc.These days i only subscribe to Edge and that's more out of habbit.

 

 

 

Cancelled my Edge sub a while ago. Just stopped being interested in what they had to say. I still sub to RG but of late haven't been all that interested in its content either.

 

Never took GamesTM all that seriously. Edge used to do nice specials but they don't seem to do that any more.

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It was easy enough to cancel the sub for Gamestm-i now just buy the RETRO Bookzines once in a while for content i've missed.

 

RG i once looked forward to each and every month, but then enthusiasm replaced accuracy to a point where issues would sit unread for months at a time, you don't dare point out that you as a paying customer knew more about the different versions of Doom, Myth or comment on the very A8 UK era you yourself lived through, or MS:Strider or Golden Axe etc as your given a label and after having asked a Mod no less than 3 times to close your forum account, your now described as being banned, lol

 

So that stopped having my money and time, never looked back, nor bought another issue since.

 

Edge once used to do superb Makings Of...(MSR, Tempest 2000, AVP, etc etc years before RG) but those days sadly long gone, so little of interest, if i stay a subscriber in next 6 months i'll be suprised.

 

Basically for myself, mainstream print mags have simply had their day, info can be found online, for free

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My low income, teenage self could afford to purchase a ColecoVision with Atari 2600 Expansion Module, an Intellivision II, and best of all I could afford the price slashed Vectrex!

I would still have all those if not for moving and deciding to stop paying on a storage unit, (but I do have the Vextrex and Expansion Module).

 

That's how my family got their MIB Vectrex and MIB 3D goggles was a closeout warehouse that the overstock had been sold to in '85.

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Nathan Strum on 17 Mar 2015 - 12:55 PM, said
I think that - at their peak - arcades were a social fad. They were an event of their time - like disco. They had an artificial popularity with people beyond those who were really just interested in playing video games, and that level of popularity was unsustainable (I wrote a blog entry about this nearly 10 years ago). Once the fad ebbed, coupled with the advances in home video games, arcades were just doomed. I don't think any changes in business practices could have saved them.

 

I agree arcades were a fad. I remember when they opened a Shane's Games arcade around 1982 in what used to be a large restaurant building in my hometown. It was arcade heaven (around 30-40 of the most popular video games, about 6 pinball tables, and a bunch of pool tables) and instantly became the #1 hangout for teenagers and college students every weekend.

 

There were a lot of teenagers and even adults playing video games and some pinball or pool but most were there just to hang out and see freinds. There were stories and news reports of fights breaking out between rival high school students and worse, drug dealers, which caused the police to be there every weekend to chase off most loiterers. My town had a new mall open up in 1984 which also had a big (and for parents, safer) arcade, and Shane's closed down around 1985 after the fad died down.

Edited by WildBillTX
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Here in the UK and in what I would call a low income area I noticed nothing,my mother was a single parent and as a 12year old in 1983 I already has my first console an Atari 2600 and if I remember correctly I would of got my first computer the Zx spectrum in that year.via a shopping catalogue.

I obviously relied on my mom to purchase me a game whenever she could which was not often but she did the best she could and I was gratefull for that, I certainly do not recall shop shelves and floor baskets overflowing with third party cheap games that is for sure.

Edited by R.O.T.S
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