Game Development Reference
In-Depth Information
crowded the marketplace and made it hard for consumers to identify which
games were worth buying. Although several of these new companies made
high quality games, many did not, quickly driving lesser developers out of
business. When the companies went bust, they liquidated their games, put-
ting downward price pressure on video games that created a death spiral,
as even more developers were sent out of business. Retailers put cartridges
made by defunct companies into bargain bins, slashing prices, which low-
ered consumer's expectations about what video games should cost. Plung-
ing price expectations made developing quality games a marginal economic
proposition. The fl ood of poor games and the dii culty identifying quality
of erings pushed consumers away from the VCS, eventually leading to a
video game collapse in North America in the early 1980s.
In attempting to establish the home as a site for play Atari benefi ted
greatly from the fact that they were able to set many of the terms of engage-
ment in the industry. Without an established industry, Atari quickly became
the dominant force, growing faster in its fi rst ten years than any company
had prior to Atari. 6 Beyond the lack of control over third-party developers, 7
Atari's management also did not foresee another key dynamic, the notion
of a console generation. Now it is well established that a video game con-
sole will have a certain lifespan and, years before a transition is expected, a
company begins work on the next version of the console. That knowledge
had not yet been established as a key part of the design of video game pro-
duction as the VCS aged. Certain forces in the company wanted to push
ahead and develop a new console, but the management of Warner Brothers,
who had acquired Atari to enable the wide release of the VCS, 8 put their
foot down. To Warner Brothers, there was no reason to develop a new
console when the existing one was selling well. Even when more powerful
video game consoles were released on the market, like the Intellivision and
the ColecoVision, those in charge of Atari thought they should continue to
capitalize on the advantage they had in the massive installed user base of
the VCS. Eventually Atari came out with a new, more powerful of ering,
but it was too little, too late, and the fl ood of subpar games was already
dragging the home video game market into the abyss.
Because of the rapid growth of technology, as embodied in Moore's law, 9
video game consoles age like computers, which means companies must
periodically release a new platform to hold the public's imagination and
stave of competition. The terms of console generations are shaped in part
by their move into the home. As a result of the inexorable growth in com-
puting power, console-producing companies can leverage the development
of more sophisticated technology to produce more powerful machines. To
ensure the ability to continue to make money on the games they release
or license, companies must maintain a powerful position in the market.
If game console makers do not have enough of their products installed in
homes to qualify as a tempting target for game development then consum-
ers will likely pass up the system because of the lack of games. As the VCS
 
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