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Atari, founded in 1972 by Ted Dabney and Nolan Bushnell, pioneered the computer entertainment industry with video game consoles and arcade games. The company was named after the Japanese word for “to hit the target.” After several ownership changes, Atari Corporation rebounded in the 1980s with the release of the Atari 2600 and later the Lynx, but ultimately merged with JTS Inc. and was sold to Hasbro Interactive and then Infogrames. Atari Interactive, a subsidiary of Infogrames Entertainment SA, currently owns the brand.
Atari is a brand that has been owned by several companies since its founding in 1972. The original company was founded by Ted Dabney and Nolan Bushnell. Their video game consoles and arcade games helped pioneer the computer entertainment industry from the 1970s to the mid-1980s.
The company was originally called Syzygy Engineering, but when Dabney and Bushnell tried to register that name in California, they found it was already in use. When he tried to come up with a new name for the company, Bushnell looked to his game Go. He finally settled on the game term atari, which meant that one’s stones were about to be taken by an opponent. In the Japanese language, this is a form of the verb ataru, which means “to hit the target” and is sometimes used in Japan when a person accurately predicts an event.
In 1973, Bushnell and his friend, Joe Keenen, created Kee Games because the distributors of Atari games all insisted on exclusive distribution deals. The two companies have marketed games to different distributors, each of which has been awarded an “exclusive” agreement. Keenan’s marketing efforts introduced Atari to the American public in 1974, and he was named president of the company.
The following year, Nolan Bushnell set out to create a new home gaming system capable of playing all of the games available at the time. His creation, the Atari 2600, was among the most popular video game consoles in gaming history. Due to the cost of manufacturing and marketing the system, Bushnell decided to sell it to Warner Communications in 1976 and use part of the profits to produce the new game console.
Atari designers immediately began work on the 2600’s successor, but halfway through development, home computers began to gain popularity. In response, new consoles were revamped to include a keyboard and various game inputs. Available in 1980, the Atari 800 and 400 enjoyed some popularity, but were nowhere near as successful as the original console. Part of the problem was that the video game console, home computer, and arcade divisions functioned independently and didn’t cooperate with each other. Another reason for the lack of success was that competitors came out with their own models, and there were fierce price wars in the video game segment of the market.
In 1983, and in the wake of those troubles, came the collapse of the video game industry. Warner Communication’s stock prices fell and lost more than $500 million US dollars (USD). They began looking for another buyer to take over the troubled Atari division. In 1984, Warner Communications sold its game console and home computing divisions to Jack Tramiel, who created the Atari Corporation.
In 1985, Atari Corporation launched the XE series and ST line. It also released the 2600 jr and 7800 consoles in 1986. The company rebounded, making a profit of $25 million (USD) for the year. In 1989, Atari released the Lynx, the first handheld console featuring color graphics. While this innovative system was met with a lot of hype, a lack of parts halted nationwide rollout of the system. The Lynx lost market share the 1989 holiday season to Nintendo’s Game Boy, a handheld console that didn’t have a color display but was readily available.
In 1996, Tramiel wanted to leave the video game business, so Atari merged with JTS Inc., a company that manufactured hard drives. In 1998, Hasbro Interactive bought the company for just $5 million (USD). Atari was sold again in 2000 when Infogrames, a popular French software publisher, bought Hasbro Interactive. The corporate name is currently owned by Atari Interactive, which is a subsidiary of Infogrames Entertainment SA (IESA). Many of the original games, including Pong, Frogger and Space Invaders are considered classics and are still played by die-hard fans.
