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Lord Mushroom

Was the Power Pack a bad idea?

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The ST often came with many games included. Most famously the Power Pack. This made the ST more attractive to potential buyers, but also reduced the incentive for third party game developers to make games for the ST, because ST owners already had a lot of games.

 

On the other hand, by selling lots of STs due to the free games, the number of potential third party game buyers was higher than it otherwise would have been.

 

So, was the strategy of offering free games a good idea or bad idea for Atari? 

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With the benefit of hindsight, it seems to me that Atari Corp's downfall was a combination of the following factors:

 

- Being almost entirely hardware devoted at the expense of software.

- Related to the above, not valuing and nurturing developer relationships.

- Poor relations with distributors.

- Being a family run company instead of insisting on the best and the brightest.

 

 

Atari thought they could push hardware just because it was a great value for the money, software be damned.  But when it came to software they didn't want their third parties to be too successful because they wanted people to buy and be reliant on their in-house developed software.  

 

That actually sort of worked for Nintendo because they had revolutionary software developers in-house.  Apple knew the end user experience was what mattered most, including the software.  Atari just wanted to make some bad ass hardware (for the price) and thought the people would throng to it.

 

Some of the anecdotes out of Atari are mindblowing.  Leonard Tramiel being forced to talk to the marketing people when designing the Falcon when they were telling him they needed to design the machine around what the user wanted and not dictate to the user what they wanted.  Sam Tramiel realizing the ST market was shot when he had to go out and buy a PC laptop for his college-bound daughter, having not paid attention to developments in the PC market and being astonished by what was available and what PCs could do.  One of the largest Atari distributors in the US (Toad Computer) being run by an 18 year old.

 

If Atari had given away development systems (ST and Jaguar) and fostered those relationships, and operated the same way with distributors, the story may have ended up similarly but the lifespan would have been much longer.

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I don't think that giving some smaller quantity (like around 10) of games with new computer changed motivation of game developers and distributors.

Looking prices of games in Europe, may say that 10 games were approx. half worth of computer price, so it was for sure good for sales.

Btw. my opinion is that high prices of games were biggest factor, what made sales not so good. Of course, they blamed piracy in first place. But big part of customers, players were young people, still in school, so not able to buy many games.  For instance charging game on 1-2 floppies around 100 DEM is in range of cartridge games for home consoles, which manufacturing costs much more - connectors, ROM chips ... Surely, developing some complexer game for 16 bit computer takes more time than some simple game for console, but with higher sale numbers it would be covered. Well, if incoming is distributed properly, and not most of profit goes to publisher, sellers . I saw lot of not well tested games - poor programmers did not have ST(E) with more RAM, and one of common errors is crashing with 1 MB RAM or 4 MB RAM, while works with less.

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I don't think it had deeper negative consequences for their future selling the ST along with a bunch of games. It was certainly a smart move while competing against Amiga and it helped sales which initially weren't all that great. Also considering overall similiarities between both computers, it wouldn't have been that hard to develop for both systems anyway. What probably didn't help the marketshare there was stuff like skimping on a really decent sound chip.

 

Where both companies had big problems was not being taken serious as being much more than a manufacturer for gaming systems in the first place. A lot of their weird, catastrophic business decisions were wrapped around being the superior gaming console while at the same time appearing as a reasonable choice for computers.

 

Not to mention that in the US consoles quickly became more popular than in Europe, so there was an even larger split between gamers and people who bought "serious computers" for work applications.

 

 

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There were several reasons for the fall of both Atari and Amiga.  First, the two most successful computer companies were Apple and IBM, at least in the US, and particularly for IBM, you were not going to overcome that with ANY computer, businesses were just too locked into the IBM mindset to change, and it was the IBM clones that really spelled the end of Atari, Amiga, and Apple.  Apple only survived because of their "revolutionary" WIMP interface which Gates wanted so bad but Jobs said no.  Atari/Tramiel was basing the ST off of the Mac and built a successful product, but they had screwed over too many distributors and had a hard time selling it in the states because of the IBM mindset and then didn't innovate the ST enough, their attempts to fix the distribution/sales problem just bit them big time in the ass, and their lack of innovation allowed the PC to catch up and then surpass them, but for a brief shining moment.  The Amiga had a similar problem except they started out late, was too expensive, but then came the 500 and they were off to the races until, once again, their innovation cycle was too slow and the PC caught up.  Both machines had great software, that was not an issue, mostly it was bad business decisions and slow development, all which can be traced back to being low-funded companies.  If you look now, it's still the same situation, there is no other machines except PC and just a smattering of Macs, <5% of the market, and Apple continues to lose market share as they are way over-priced and everyone knows it.  So, it was not software, not sales, just bad decisions and timing.  They had their moment in the sun, and could have remained, particularly the Amiga, but bad decisions killed them in a very competitive business environment.

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Apple is doing very fine and they sell approx. the same number of Macs each year. Doesn't matter if they lose market share as long as they keep their very healthy margin.

Atari chose the mass market though, with slim margins. This would never have worked out against an army of PC clones. More innovation would've bought Atari a few more years, not more.

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Posted (edited)

Reasons for Atari Co. fall are constant topic here. What is sure by me is that we can not blame only one thing for that. And that there were internal and external circumstances which made sales lower, especially after 1992.

Here I will say only that STE, launched in 1989 had 2 silly bugs, which are for sure result of not enough testing, which again could be result of bad relations inside company, rush ... So, there is known medium resolution bug in TOS 1.06, it was corrected with TOS 1.62 . Other is less known audio mixer HW bug - impossible to set correct PSG and DMA audio volume balance because they miscalculated resistor values for it. And that error exists in TT too, only in Falcon it is correct.

Edited by ParanoidLittleMan
missing balance

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On 3/18/2021 at 5:51 PM, kimchipenguin said:

Apple is doing very fine and they sell approx. the same number of Macs each year. Doesn't matter if they lose market share as long as they keep their very healthy margin.

Atari chose the mass market though, with slim margins. This would never have worked out against an army of PC clones. More innovation would've bought Atari a few more years, not more.

Is Apple doing very fine?  Oh, right, they make >95% of their revenue off of the iphone, NOT computers, get it?  When Jobs was coming back, Apple was heading towards bankruptcy, this was before ipod and iphone, so its computer market is shaky and may even not be sustainable without iphone revenues.

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On 3/19/2021 at 8:09 AM, calimero said:

And here is similar topic about Amiga on eab forum:

 

https://eab.abime.net/showthread.php?t=105968

 

very good topic with nice informations!

I read the first page of this, the opening post was right on the money and is why I bought the ST instead of the Amiga (although I did get an 500 much later for games!).  You could not do serious work on an Amiga, the test display was not good and did not in any way compare to the ST.  Even today when I run my 1200 it just does not look good compared to hi-rez ST.  And now that I have the TT, well the A1200 is great for games, but for serious work the TT bitch-slaps it!

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2 hours ago, Randy said:

Is Apple doing very fine?  Oh, right, they make >95% of their revenue off of the iphone, NOT computers, get it?  When Jobs was coming back, Apple was heading towards bankruptcy, this was before ipod and iphone, so its computer market is shaky and may even not be sustainable without iphone revenues.

 

I believe the Mac sits somewhere between 10-15% of Apple's quarterly revenue and was something like an $8+ billion dollar business in the last quarter (Q1 2021).  Not too shabby.

 

They are also killing it with processor design, and Macs are very much preferred among students and creative professionals.  That market isn't going to disappear any time soon.

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3 hours ago, Randy said:

 And now that I have the TT, well the A1200 is great for games, but for serious work the TT bitch-slaps it!

 

This!  :)

 

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I had the STe Turbo Pack and the amount of games/software that came with it was a major selling point over the Amiga to my naive 10 year old self.  In business terms, the Turbo and Discovery Packs were what Alan Sugar called a "mug's eyeful" which is when they bundle together a load of outdated gear they can't sell and present it at an attractive price point to inexperienced chumps.

 

I think these packs were a good idea and certainly a lot better conceived than some of the marketing ideas for the Amiga (A500 Batman Pack excepted).  I made the right decision for the wrong reason and even when the Amiga became available to me many years later I still preferred the ST.

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On 3/15/2021 at 2:19 PM, Lord Mushroom said:

The ST often came with many games included. Most famously the Power Pack. This made the ST more attractive to potential buyers, but also reduced the incentive for third party game developers to make games for the ST, because ST owners already had a lot of games.

 

On the other hand, by selling lots of STs due to the free games, the number of potential third party game buyers was higher than it otherwise would have been.

 

So, was the strategy of offering free games a good idea or bad idea for Atari? 

The flaw in your logic is the assumption that you can ever have enough games. ;)

 

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Posted (edited)

I suppose the Power Pack might have prevented many users from buying new games immediately with their ST but after that you'd think the interest for newer games would come. From a consumer perspective it's hard not to be happy with the games bundled in though and I played many of them constantly over the years when the ST was my main computer. 🙂

Edited by TheNightOwl
Typo

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21 hours ago, Randy said:

I read the first page of this, the opening post was right on the money and is why I bought the ST instead of the Amiga (although I did get an 500 much later for games!).  You could not do serious work on an Amiga, the test display was not good and did not in any way compare to the ST.  Even today when I run my 1200 it just does not look good compared to hi-rez ST.  And now that I have the TT, well the A1200 is great for games, but for serious work the TT bitch-slaps it!

To be fair (and not be like some Amiga 'fans', who write all kind of deformed 'opinions' about ST) I would add here some things: Amiga was designed as gaming and video processing computer. So, it had real interlaced video, according to TV standards NTSC and PAL . That self resulted in not so sharp and clean picture. And therefore one of serious works what people could do with Amiga was making diverse videos. DMA sound was welcome in that. And there was genlock function too, what was used widely for adding subtitles to video - like VHS, Beta . And even lot of professional TV commercials was done with Amiga in early years.

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Really depends on the exact time of release for the pack and each game in the bundle pack relative to the date the ST bundle was launched and how well it sold. So my comments are not going to be specific to this pack.

 

In principle it's a great idea, it's down to the software houses not to give away their releases that still sell well long after release to new ST owners that pop up (like Dungeon Master or Defender of the Crown etc that don't age for new consumers). Activision pulled the promised Pitfall from the C64/ZX Softaid compilation and replaced it with crusty Beamrider at the last minute because they knew that was a mistake for Activision.

 

Problem is the knock-on effect like you say, if one software houses gives away two really great games then that initially hurts sales of well respected good selling games from all the other publishers not just that one publisher so through no fault of their own other publishers lose out on sales from new ST owners. This has a second effect on the false impression that the ST market is slowing down because the new machines are sold but there is a delay until people get bored of the bundled Power/Summer pack games buying new games at retail.

 

My memories are getting faint about the 80s but I am going to guess the biggest problem for the ST (and all other home computers) was the rampant piracy. My friend who got an STFM about 9 months after I got my 520STM had stacks of pirated games within weeks. After wasting money on rubbish like Deep Space and Barbarian by Psygnosis I too gave up on buying full price games due to the lack of quality getting worse due to the rampant piracy....no win scenario. The problem moved onto the Amiga and that machine rarely had an acceptably coded game (unless you had some Amstrad or Sinclair or Acorn computer before the Amiga....if you had a VCS or C64 or A8 the Amiga games were highly erratic in frame update to you most of the time!)

 

End of the day nobody put a gun to the publishers heads, if they had games that weren't selling and had peaked in the charts ages ago/made most of the revenue they probably ever would they can offer them in bundles. Don't forget that the bundles were there to help when Atari first had to put the price up of the 520STFM back up to 399 after it came down to 299 to make life hard for Commodore's 499+Sales tax A500 hideous machine in Summer 1987. Atari knew there were aspects of ST games that could never rival Atari 8bit/C64 games (sound and smooth scrolling) and yet they needed to tempt existing 8bit users into the 16bit marketplace (something Commodore failed at for half a decade).

 

Also Atari were not writing any 'killer apps' to bundle with the ST themselves, odd because Jack should have known a hell of a lot of 1983-84 C64 games sold on the back of the very cheap and very excellent [for the year] International Soccer cartridge. Kids in the EU were suckers for a computer with an excellent footy game. And the Amiga suddenly was not A1000 priced vs 520STFM prices after middle of 1987 any more and the STE was a long way off so you had to add value....and hide the first of two price hikes back up to £399 from £299 in the mid-late eighties (which for some reason Commodore didn't have to do...perhaps they had large stocks of DRAM or made them in MOS for the A500 who knows).

 

Summer Pack was the best I think, the one with the original International Karate not IK+ on ST.. Never had any packs, got the 520STM as soon as it came out because it was cheaper than a Commodore 128D + Mouse + GEOS and well Neochrome was brilliant and I was interested in computer graphics.....did all the sprites for Gradius and Salamander by hand on Neochrome on my ST when I got home from playing the arcade games in 1986 :)

 

Ultimately software houses in the UK were mostly too greedy and too devoid of talent combined with rampant piracy this is probably the biggest reason the computers failed. Nobody should have been buying the crappy NES when for a brief period you could get an ST with Commando and Ghosts n Goblins for a bit over 100 quid more than an NES deluxe pack and those two same games...which are nothing like the arcade versions unlike the excellent ST ports. Lotus on ST came a little too late in many ways (Amiga models got cheaper, software houses abandoned the ST or did very slap-dash developments technically) but if Lotus on ST is better than 90% of Amiga racing games technically :)

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The Power Pack was both a blessing and curse.  It did help sell Atari STs.  However, it also help to turn publishing houses away from the ST to other platforms like the Amiga.  Check out this episode of The Retro Hour (https://theretrohour.com/atari-uk-the-rise-and-fall-with-darryl-still-the-retro-hour-ep71/) to get an inside scoop of what all went down.

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5 hours ago, Hwlngmad said:

The Power Pack was both a blessing and curse.  It did help sell Atari STs.  However, it also help to turn publishing houses away from the ST to other platforms like the Amiga.  Check out this episode of The Retro Hour (https://theretrohour.com/atari-uk-the-rise-and-fall-with-darryl-still-the-retro-hour-ep71/) to get an inside scoop of what all went down.

So how come there was no revolt against Commodore when they released their Batman Packs?  Plus piracy was just as bad for the Amiga platform but UK game publishers still gave it preference over the ST, so how did that come about?

 

Anyway, while I do agree there was way too many games given away with the Power Pack...the 520STe Discovery Pack had the right amount of games.  Personally I would have prefered a couple of games along with useful apps like a word procesor and paint program.  I guess Half-meg computers were considered gaming consoles while Full meg machines were more serious.

 

On a personal note, my local dealer had both the 520 STe Discovery pack with a couiple games I've always wanted (Final Fight & Sim City) and the 1040 STe with just (sigh...) ST Basic.  My mother who bought me the computer for my graduation gift wanted me to have the most memory available right away.  Didn't had anything to play on but in the long term it was a better decision to have more RAM.

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Something I did not see mentioned here: maybe diverse packs just included (what means not that all of it was such) already manufactured but not sold game releases ?

So, game in original box, disk with original publisher printings, and like. I did not see any of packs mentioned here, so someone who did could say more about such case.

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17 hours ago, MrMaddog said:

So how come there was no revolt against Commodore when they released their Batman Packs?  Plus piracy was just as bad for the Amiga platform but UK game publishers still gave it preference over the ST, so how did that come about?

(Whispering) The Tramiels.  Also (speaking normally), Atari did not support publishes as good as Commodore did, particularly Commodore UK and Commodore Germany.  Some good information can be found in this The Retro Hour podcast episode (https://theretrohour.com/sega-genesis-launch-michael-katz-ep194/) about that point.

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