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Atari

The company that invented the video game boom - and the crash

Defunct — The company that invented the home video game boom, then helped cause the catastrophic 1983 crash.

Atari was the company that invented the video game industry as we know it. Founded by Nolan Bushnell in 1972, it turned Pong into the national craze and then, with the Atari 2600 in 1977, made home consoles a household thing. At its peak Atari was growing explosively and had become as recognizable as an arcade in the corner of a diner.

But success bred oversupply. The early 1980s saw an avalanche of cheap games of wildly varying quality, and the market flooded. In late 1982 and 1983 the whole industry collapsed - the infamous rush of bad cartridges, most famously E.T., and the decision to dump unsold stock in a New Mexico landfill became the legend of the Video Game Crash.

Atari itself was sold, split, and churned through owners for years. The name survives as a licensing shell making retro-branded products, but the company that gave the world the video game console and then nearly killed it is effectively a ghost.

Timeline

  1. 1972 — Pong: Atari launches Pong and ignites the arcade era.
  2. 1977 — Atari 2600: The home console makes video games a family pastime.
  3. 1982 — The over-saturation: A flood of low-quality games plus E.T. push the market past its limit.
  4. 1983 — The great crash: The video game industry collapses; Atari is dismantled and sold.
  5. 1984- — The long fade: The brand passes through owners, reduced to a licensing shell.

Quick facts

Founded
1972, by Nolan Bushnell
Breakthrough
Pong (1972); Atari 2600 (1977)
The crash
Video Game Crash, 1983
The myth
E.T. cartridges buried in a landfill
Today
A licensing shell/brand

Lineage — where the name went

Atari changed hands more than almost any famous technology brand: Warner, then Jack Tramiel, then a disk-drive company, then Hasbro, then a French publisher that took the Atari name for itself.

  1. 1972 — Nolan Bushnell & Ted Dabney founded Atari
  2. 1972 — Atari created Pong (the arcade game that created the industry)
  3. 1977 — Atari created Atari 2600 (VCS) (the 2600)
  4. 1976 — Atari acquired by Warner Communications (sold to Warner for about $28m)
  5. 1984 — Atari spun off Atari Games (the arcade division stayed with Warner)
  6. 1984 — Atari acquired by Atari Corporation (Jack Tramiel bought the consumer division and renamed it)
  7. 1996 — Atari Corporation merged into JTS
  8. 1998 — Atari acquired by Hasbro Interactive (JTS sold the Atari properties to Hasbro Interactive)
  9. 2001 — Atari acquired by Infogrames (Hasbro sold the Atari properties on)
  10. 2003 — Infogrames rebranded as Atari SA (the publisher took the Atari name for itself)

Entities in this tree: Nolan Bushnell & Ted Dabney (person, 1972); Atari (company, 1972); Pong (product, 1972); Atari 2600 (VCS) (product, 1977); Warner Communications (company, 1976); Atari Games (company, 1984); Atari Corporation (company, 1984); JTS (company, 1996); Hasbro Interactive (company, 1998); Infogrames (company, 2001); Atari SA (company, 2003)

Sources

  1. Atari - Wikipedia — Wikipedia (2026-02-09)
  2. The video game crash of 1983 — History (2026-02-09)

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