Would Atari had been better off if Bushnell hadn´t sold it?

[Flojomojo]

Nolan cashed out because he knew he didn’t have the business experience to take his scrappy startup to the big leagues. It’s a very different skill set to bring an idea forward vs grow it into a large multinational success and keep it there. 
 

I know Nolan’s hot-tub and marijuana culture would have made for a more fun place to work, but I don’t know if it would have been a financial success in the long run. Maybe he could have kept the Activision talent happy for longer so they could have made their innovative games under the Atari banner instead of striking out on their own. 
 

I think the 1984 crash would have happened with or without Nolan, because of all the other external factors like home computers and the overall same-ness if much of the expensive product on the market. 

[Lord Mushroom]

27 minutes ago, zzip said:

The video crash mirrors the dot-com crash pretty well.   There's a period of crazy growth as it's the hottest thing around. (81-83)   Then there's a mirror period of over-correction when people don't want to go near it (84-85), then after that it balances out and achieves a sustainable growth rate

The dot-com crash didn´t happen because there was a drop in consumer demand. It was the attractiveness of dot-com companies to investors which plummeted.

 

I have difficulties believing that people loved video games up to 1983, then completely lost interest for 2-3 years, but have loved them every since. That would kind of be like people lost interest in music for a couple of years. But of course, if they mostly made bad music for a couple of years, income from new music would plummet.

[Lord Mushroom]

19 minutes ago, Flojomojo said:

Nolan cashed out because he knew he didn’t have the business experience to take his scrappy startup to the big leagues. It’s a very different skill set to bring an idea forward vs grow it into a large multinational success and keep it there.

He could have just hired somebody if he didn´t feel up to the task.

[Flojomojo]

He did! The Warner CEO

[Lord Mushroom]

23 minutes ago, Flojomojo said:

I think the 1984 crash would have happened with or without Nolan, because of all the other external factors like home computers and the overall same-ness if much of the expensive product on the market. 

The crash was caused by a mismatch between expectations and reality, and Nolan was not as optimistic as Warner. And the likely lower early sales of the 2600 would mean there would be more of a demand for it when cheap computers arrive.

[Lord Mushroom]

3 minutes ago, Flojomojo said:

He did! The Warner CEO

That is some wide definition of hire.

[Flojomojo]

Hires 

 

[+davidcalgary29]

What I'd like to see is a financially viable business plan for selling the A8 line, by Warner, in the North American market. Did they ever make a profit off of any of that?

 

If it weren't for the Tramiels, I imagine that the A8 would've ended up like the TI-99 x/x. Love you, TI fans!

 

[+x=usr(1536)]

54 minutes ago, davidcalgary29 said:

What I'd like to see is a financially viable business plan for selling the A8 line, by Warner, in the North American market. Did they ever make a profit off of any of that?

No idea about the A8 range ever turning a profit, but it seems as though once the 400 and 800 hit the market, any sense of planning products for the future went right out the door.

 

A8: nifty systems for 1979!  Now build them largely-unchanged until 1992.  Customers like that.  No need for scary things like 80-column support, faster CPUs, or improved sound and graphics before we jump to 16-bit

 

5200: ok, we'll make our console computer console the successor to the 2600, but without full A8 compatibility so that software development and availability is hampered

 

7800: thanks for the system, guys, but we're gonna sit on it for two years instead of getting it fully to market because all we see is the cost of it to Atari if we pay off that $500,000 we think Warner owes GCC and not its actual value

 

ST: sure, it was rushed after we let Amiga get away, but wasn't a bad machine.  Now take a leaf out of the A8's book and don't give it upgrades at the times where it needs them to remain competitive

 

TT, Falcon, Transputer: look the other way

 

Portfolio: cool enough to be featured in Terminator 2 for ATM hax0ring, but we can't market our products to save our lives

 

Jaguar: it's the next (and final) generation of squandered opportunity

Quote

If it weren't for the Tramiels, I imagine that the A8 would've ended up like the TI-99 x/x. Love you, TI fans!

Jack's skinflint nature certainly helped to ensure that a good chunk of Atari's lineup wasn't put out to pasture when it would have made sense to do so.

[Matt_B]

The problem for the A8 was that it was really inconvenient for Warner, whose business model was that the VCS was a golden goose that was never going to die.

It wasn't much more convenient to the Tramiels who bought the company for the sole purpose of getting the ST to market, only to find that they had a bunch of other products on the books, some of which still had at least a moderate amount of demand for them. Ah well, at least they kept the A8 engineering team even if they fired most of the rest of the employees.

[+davidcalgary29]

How dare you forget the Lynx! My preciousss...

[Matt_B]

I'd think the best thing for the Lynx would have been if Epyx had found another way of raising capital than selling out to Atari. ?

[+davidcalgary29]

Just now, Matt_B said:

The problem for the A8 was that it was really inconvenient for Warner, whose business model was that the VCS was a golden goose that was never going to die.

It wasn't much more convenient to the Tramiels who bought the company for the sole purpose of getting the ST to market, only to find that they had a bunch of other products on the books, some of which still had at least a moderate amount of demand for them. Ah well, at least they kept the A8 engineering team even if they fired most of the rest of the employees.

No, I'm serious. If it weren't for the Tramiels, the A8 would have been discontinued in 1984 and entered the lofty halls of the Cypher House Rules along with the esteemed company of the PC jr. and the Aquarius. We wouldn't have a European scene at all, and the LucasFilm games would have been the pinnacle of the A8 experience. Thank you, skinflints!

[+davidcalgary29]

2 minutes ago, Matt_B said:

I'd think the best thing for the Lynx would have been if Epyx had found another way of raising capital than selling out to Atari. ?

Fun fact that we like to forget: NO ONE ELSE wanted the Lynx. Can you believe that? Atari was the place where dreams went to die. They knew it, Atari knew it, and the consumers knew it too: it was the company that had extremely cool tech that was coveted by an audience of three people. 

[+x=usr(1536)]

12 minutes ago, davidcalgary29 said:

How dare you forget the Lynx! My preciousss...

Good point.  It was a lovely little machine, and certainly not overlooked intentionally.

 

 

[Matt_B]

Just now, davidcalgary29 said:

Fun fact that we like to forget: NO ONE ELSE wanted the Lynx. Can you believe that? Atari was the place where dreams went to die. They knew it, Atari knew it, and the consumers knew it too: it was the company that had extremely cool tech that was coveted by an audience of three people. 

Oh, I know that. I'm just poking a little fun at the original premise of this discussion.

 

Without the Tramiel money, the Lynx would most likely have died in obscurity; a what-if machine of dreamlike potential in the same fashion as the Sega Neptune or the Konix Multisystem, rather than the somewhat impressive but flawed reality of what it ended up being.

 

That either fate might have befallen the VCS without Warner's injection of cash into Atari doesn't even seem to have crossed some people's minds here.

 

7 minutes ago, davidcalgary29 said:

No, I'm serious. If it weren't for the Tramiels, the A8 would have been discontinued in 1984 and entered the lofty halls of the Cypher House Rules along with the esteemed company of the PC jr. and the Aquarius. We wouldn't have a European scene at all, and the LucasFilm games would have been the pinnacle of the A8 experience. Thank you, skinflints!

Yeah, the Tramiels might not have done much with the A8 but that last generation of machines certainly wouldn't have happened without them. I still think of the 800XL as the definitive A8 though.

[Lord Mushroom]

11 hours ago, davidcalgary29 said:

What I'd like to see is a financially viable business plan for selling the A8 line, by Warner, in the North American market. Did they ever make a profit off of any of that?

They must have, they did pretty well. And they wouldn´t have kept releasing computers if the previous ones weren´t profitable.

[Lord Mushroom]

11 hours ago, Matt_B said:

The problem for the A8 was that it was really inconvenient for Warner, whose business model was that the VCS was a golden goose that was never going to die.

Because of its much higher price, it wasn´t a big threat to the VCS. At least not until the VCS was starting to become obsolete anyway. VCS sales kept going through the roof after the A8 was introduced.

[Lord Mushroom]

10 hours ago, Matt_B said:

That either fate might have befallen the VCS without Warner's injection of cash into Atari doesn't even seem to have crossed some people's minds here.

It has crossed the minds of some people, but some people have also pointed out that there were other possible sources of cash available (even the same source without selling).

Edited August 10, 2021 by Lord Mushroom

[ZippyRedPlumber]

I'm just gonna leave this here...

 

https://youtu.be/wYYnUm_8WDc

[TwoShedsWilson]

I don't know that there would have been a VCS without Warner. Were there other options? Sure, but this was an entirely new field, new product, new everything and nobody would have just written a check and hoped for the best. Bushnell needed a strong business backing to take their ideas and make them a marketable reality which Warner did. As others have said here Warner was also too heavy-handed and stopped listening to the people that had the ideas and slowly killed the company. Gutting it and handing the remains to Tramiel certainly didn't help.

 

To the original question, no I don't think Atari would have been better off without Warner. Maybe some other option would have happened, but I don't see Atari playing out much differently with other backing. Video games were going to happen and left to their own devices I don't think Atari would have been the ones to do it. Not at home anyway.

 

Had there, in some magical fairyland, have been an extremely unlikely pairing of a strong manufacturing/marketing/business power that let the Atari idea machine do mostly what it wanted then we would have seen a very different outcome on everything. Either we'd be playing an Atari 280000 or there would be some neat YouTube videos about the spectacular demise of an obscure company named Atari.

[Lord Mushroom]

1 hour ago, ZippyRedPlumber said:

I'm just gonna leave this here...

 

https://youtu.be/wYYnUm_8WDc

That is the first time I have seen a You Tube video with "No Views".

[+davidcalgary29]

3 hours ago, Lord Mushroom said:

They must have, they did pretty well. And they wouldn´t have kept releasing computers if the previous ones weren´t profitable.

Well actually...

 

 

[Lord Mushroom]

35 minutes ago, TwoShedsWilson said:

I don't know that there would have been a VCS without Warner. Were there other options? Sure, but this was an entirely new field, new product, new everything and nobody would have just written a check and hoped for the best. Bushnell needed a strong business backing to take their ideas and make them a marketable reality which Warner did.

Arcade games were new, and a one-game home console were new. They did arcade games alone, and Home Pong with venture capitalists. Having a partnership, more venture capitalists and/or an IPO would have provided Bushnell with money and assistance.

Edited August 10, 2021 by Lord Mushroom

[TwoShedsWilson]

50 minutes ago, Lord Mushroom said:

Arcade games were new, and a one-game home console was new. They did arcade games alone, and Home Pong with venture capitalists. Having a partnership, more venture capitalists and/or an IPO would have provided Bushnell with money and assistance.

Apples and oranges. Arcade machines at the time were "I know a guy with a bar, maybe he'll let us put this in." The machine makes money work out a deal with a distributor and maybe you print some flyers. Getting some arcade cabinets sold is a very different beast from a national marketing campaign. Let's say I have an idea for some revolutionary doodad and it works, cool. You could then hand me ten billion dollars and I'd have no idea where to start. I'd hire lawyers, consultants, engineers, blah blah blah.. hoping I don't get screwed by any of them. In the end I would end up selling it and letting someone that knows what they're doing sort it out.

 

Ever watch Shark Tank? You know those people that fall apart as soon as real questions about their business model start getting asked? That was Atari with the VCS. That's when they may still get offers, but they'll be a lot less favorable because the "sharks" realize they'll have to do a lot more work. Bushnell was never going to find anyone that was just going to let him do whatever while they wrote checks.

Edited August 10, 2021 by TwoShedsWilson