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History of Video Games

- Text Version

History of Video Games

- Text Version

The History of Gaming

By Leonard Herman, Jer Horwitz, Steve Kent, and Skyler Miller

In 1949, a young engineer named Ralph Baer was given an assignment to build a television set. He wasn't supposed to build just any television set, but one that would be the absolute best of all televisions. This was not a problem for Baer, but he wanted to go beyond his original assignment and incorporate some kind of game into the set. He didn't know exactly what kind of game he had in mind, but it didn't really matter because his managers nixed the idea. It would take another 18 years for his idea to become a reality, and by that time there would be other people to share in the glory, like Willy Higinbotham, who designed an interactive tennis game played on an oscilloscope, and Steve Russell, who programmed a rudimentary space game on a DEC PDP-1 mainframe computer. And then there was also Nolan Bushnell, who played that space game and dreamed of a time when fairground midways would be filled with games powered by computers.

Today, with interest in classic games gaining steam once again, players of video games are reminded of the rich history of the industry. Crave's Asteroids 64 is a modern version of a game that came out in 1979. And the original Asteroids was merely an updated version of Nolan Bushnell's Computer Space, which was really a jazzed-up copy of Steve Russell's Spacewar. Space Invaders, Centipede, Frogger, and Pong are once again on store shelves, and Pong is but a polished variant of the game Willie Higinbotham displayed on his oscilloscope.

The history of video games is not just about people. It's also about companies and ironies. Atari was an American company with a Japanese name, and the Japanese company Sega was started by an American. Magnavox, the company that started it all, is owned by Phillips, a company that is over a century old, and Nintendo, the company that made video games popular again, is just as old. And who would have ever thought Sony, the company that invented all types of electronics, from transistor radios to video recorders, would release a video game console that would become its top-selling product of all time?

In today's world, where video games are often cited as a source for teenage violence, it's interesting to see that the first home console also had a light rifle as an optional peripheral.

The world of video games continues to evolve. By reading about the past, perhaps you'll also get a glimpse of the future.

Before the Games 1889-1970:

Fusajiro Yamauchi establishes the Marufuku Company to manufacture and distribute Hanafuda, Japanese playing cards. In 1907, Marufuku begins manufacturing Western playing cards. The company changes its name to The Nintendo Playing Card Company in 1951. "Nintendo" means "leave luck to heaven."

Gerard Philips establishes a company in the Netherlands to manufacture incandescent lamps and other electrical products.

Konosuke Matsushita establishes the Matsushita Electric Housewares Manufacturing Works. During the next 70 years, the company will establish a multitude of companies, including Panasonic.

The Connecticut Leather Company is established by a Russian immigrant named Maurice Greenberg to distribute leather products to shoemakers. In the early '50s, Maurice's son Leonard creates a leather-cutting machine, and the company, which soon trades under the acronym COLECO (short for Connecticut Leather Company), begins selling leather craft kits. By the end of the decade, Leonard will have built a plastic-forming machine and the company will have jumped into the plastic-wading-pool industry.

From their garage workshop, Harold Matson and Elliot Handler produce picture frames. They come up with the name "Mattel" by combining letters from their names. Elliot uses the scraps from the picture frames to begin a side business making dollhouse furniture.

Akio Morita and Masaru Ibuka set up the Tokyo Telecommunications Engineering Company. After seeing an American-made tape recorder, Morita decides his company should begin making them. In 1952, Ibuka and Morita barely raise the $25,000 fee to become one of the first foreign companies to license the transistor patent from Bell Labs. They then use the transistor to create the world's first pocket-sized battery-powered radio. The transistor radio is a success in Japan, and Ibuka and Morita begin looking at marketing their products in the United States and Europe. Realizing the English translation of their company name is too cumbersome for English-speaking people to remember, they modify the Latin word sonus (sound) and come up with Sony, a word that has no meaning, for their new corporate name.

Ralph Baer, an engineer with Loral, a company that develops and manufactures complex military airborne electronics, is instructed to "build the best TV set in the world." Baer suggests they add some kind of interactive game to the TV set to distinguish it from other companies' TVs, but management ignores the idea.

Former US Korean War veteran David Rosen sees the popularity of mechanical coin-operated games on US military bases in Japan, so he starts Service Games to export these games to Japan. In the 1960s, Rosen decides to make his own coin-operated games, so he purchases a Tokyo jukebox and slot-machine company. The name SEGA, short for "SErvice GAmes," is stamped on the games that Rosen produces, and eventually Rosen adopts it as his company name.

The Games Begin 1971-1977


Computer Space.

Nutting Releases First Arcade Video Game
Nutting manufactures 1,500 Computer Space machines. The components are packaged with a 13-inch black-and-white TV set in a futuristic-looking cabinet. The first arcade video game is released, but the public finds it too difficult to play.


Magnavox Begins Manufacturing the Odyssey
Magnavox begins manufacturing Baer's TV game system, which it calls the Odyssey. Sanders and Magnavox begin showing it to distributors around the country.

Magnavox Unveils First Home Video Game
Magnavox displays the Odyssey at a convention in Burlingame, California, on May 24. Nutting, believing it's the only company dealing with video games, sends Bushnell to see the machine. Bushnell spends a few hours playing video tennis and other games and later reports back to Nutting that he found the Odyssey uninteresting and in no way any competition for Computer Space.

Bushnell Leaves Nutting
Computer Space does not sell well, and Bushnell comes to the conclusion that it is too difficult to play. He realizes that if he can design a simple game, it might be a major draw. He informs Nutting, who tells him to go ahead and design a new machine. Bushnell decides that since he is the brains behind video games he should get a larger share of the profits. When he demands a third of Nutting Associates and doesn't get it, he leaves the company.

Bushnell Starts Atari
Bushnell and Dabney decide to start their own company to design video games for other companies to distribute. They originally call their company Syzygy (the straight-line configuration of three celestial bodies), but that name is already being used by a roofing company. They then settle on the name Atari, a term from the Japanese game Go, whose meaning is equivalent to "check" in chess.


Pong Is Born
Bushnell hires Al Alcorn to program games. Since Alcorn is inexperienced, Bushnell has him program a simple video tennis game as an exercise. They call the game Pong, for two reasons: first, "pong" is the sound the game makes when the ball hits a paddle or the side of the screen, and second, the name Ping-Pong is already copyrighted.

Pong Breaks Down
Bushnell tries selling Pong to established arcade manufacturers. After finding Bally disinterested, Bushnell decides to market the game himself. Pong is test-marketed in Andy Capps, a local bar. Within two weeks the test unit breaks down because the coin drop is flooded with quarters. Pong is a success.

The Magnavox Odyssey.

Magnavox Releases Home Video Game
Magnavox sells the Odyssey exclusively through its own stores. People are led to believe the console will only work with Magnavox televisions. Still, Magnavox manages to sell 100,000 units. Many people buy it because it is the closest thing they can get to a home version of Pong.




The Golden Age 1978-1981


Bushnell Leaves Atari
Bushnell leaves Atari and signs a lucrative five-year agreement not to compete with the company he started. He buys the rights to Pizza Time Theatre from Atari and begins franchising it. Ray Kassar becomes the CEO of Atari.

Nintendo Releases Arcade Game
In March, Nintendo of Japan releases Computer Othello, a decidedly simplistic arcade cocktail-table game based on the board game Othello.

Trackball Rolls Into Arcades
Atari releases the arcade game Football. The game features a revolutionary new controller called the trackball.

Midway Imports Game to Beat
Midway imports Space Invaders from Taito. Space Invaders gives you a goal by displaying the current high score for you to beat.

Arcade Success Stories
Both Football and Space Invaders break all known sales records with almost equal earnings. However, Football's popularity fades with the end of the pro football season. Space Invaders' popularity continues, causing coin shortages in Japan and school truancy in America.

The Atari 400.

Atari Enters Computer Market
Atari begins selling its line of 400 and 800 computers to compete against Apple. The public, however, associates Atari with games, and the computers are never taken seriously.

Magnavox's Odyssey 2.

Magnavox Releases Console With Keyboard
Magnavox releases the Odyssey2, a programmable console that has a built-in membrane keyboard.

Vector Game Released
Cinematronics releases Space Wars, a game similar to Bushnell's Computer Space. The game features vector (line-drawn) graphics. Vector graphics are the earliest form of polygon graphics to appear in video game applications, and they lack the flat shading or textures of later graphics.


The unreleased Atari Cosmos.

Holographic Games
Atari develops the Cosmos, a handheld programmable machine that features holograms within the graphics. Because the holograms are only for aesthetics and don't add to the gameplay, the Cosmos is never released.

Atari Vectors
Atari releases Lunar Lander, its first vector graphics game. Lunar Lander Begets Asteroids
Despite Lunar Lander's popularity, Atari halts production of the game and begins releasing Asteroids in the Lunar Lander cabinets. Asteroids is a game that was originally designed by Lyle Rains and Ed Logg for the Cosmos system. It goes on to become Atari's all-time best-seller. Asteroids introduces a new feature to arcades: High scorers can enter their three-character initials at the end of the game. Nearly 80,000 units are sold in the United States, but the game is less popular in other countries. Sega releases Monaco GP, a driving game with a top-down perspective, which is followed by the similar Pro Monaco GP in 1980 and the realistic 3D racer Super Monaco GP in 1989.

The Microvision.

Milton Bradley Releases Programmable Handheld Video Game
Milton Bradley Electronics releases the Microvision, a handheld programmable unit that includes its own built-in LED screen.


Space Invaders Come Home
Atari releases its exclusive home version of Space Invaders for the VCS. Sales of the VCS skyrocket.

An Intellivision brochure.

Mattel Intellivision
Mattel Electronics introduces the Intellivision game console. The first serious competition for the VCS, the Intellivision has better graphics and a steeper price--$299. Mattel promises to release an optional peripheral that will upgrade the Intellivision console into a personal computer.




The Great Crash 1982-1984


Coleco Releases the Colecovision
Coleco releases the Colecovision, a cartridge-based game console buoyed not only by superior graphics and sound, but also by support from a growing game company: Nintendo. Nintendo licenses Donkey Kong and Donkey Kong Junior to Coleco, which releases excellent translations for the Colecovision and ports reasonable versions to the Atari VCS and Intellivision. Coleco also releases an adapter that lets VCS cartridges be played on the Colecovision. Realizing that Atari has firm support from Namco, creator of Pac-Man, Coleco involves itself heavily with Sega, Konami, and Universal (Mr. Do!).

Magnavox Does It Better
Magnavox releases a game called K.C. Munchkin for the Odyssey2. Atari deems K.C. Munchkin to be very similar to Pac-Man and sues. Atari wins the lawsuit, and Magnavox must remove K.C. Munchkin from the market.

Pac-Man Clone?
Atari releases its highly anticipated 2600 version of Pac-Man, which unfortunately doesn't resemble the arcade game at all. The public quickly becomes disenchanted with the company.

E.T. Goes Home
Atari releases E.T. for the VCS, a game Howard Scott Warshaw programmed in six weeks. Expecting a sellout, Atari reportedly manufacturers more E.T. cartridges than there are 2600 consoles in use. As was the case with Pac-Man, the public is disappointed by the game. Massive numbers of both Pac-Man and E.T. games end up in a huge landfill in New Mexico, along with millions of other unsold and unwanted game cartridges. Original games such as Activision's Pitfall (by David Crane) sell well.

The Atari 5200.

Atari Super System
Atari releases the 5200 game console to compete with the Colecovision, although it had originally been designed to compete with the Intellivision. Based on the graphics and audio chips found in Atari home computers, 5200 games are essentially aesthetically improved rereleases of VCS games (the VCS was renamed 2600). The machine is incompatible with 2600 game cartridges until Atari belatedly introduces an adapter so 2600 games can be used on the 5200. A major strike against the system is its controller, which features a noncentering joystick.

The Vectrex.

Vectors Come Home
General Consumer Electronics (GCE) releases the Vectrex, the first and only home console based on vector graphics technology. The Vectrex includes a built-in game (Minesweeper, an impressive Asteroids clone) and one four-button analog joystick controller.

Pac-Man Fever
Midway creates Ms. Pac-Man in-house. It becomes the biggest arcade game in American history, with more than 115,000 units sold in the United States, but Namco, which is not involved with Ms. Pac-Man, develops the improved, but radically different, Super Pac-Man for Japanese consumers. A number of Pac-Man "enhancement chips" arrive on the market to speed up the original Pac-Man and change its characters and mazes. The most popular enhancement, Pac-Man Plus, replaces the generic fruits and other bonus items in Pac-Man with popular American items such as Coke cans.

Stock Drop
On December 7 (3:04pm Eastern Standard Time), Atari announces that VCS sales did not meet predictions. Warner Communications stock drops 32 percent in a single day.


New Bushnell Company
Nolan Bushnell becomes eligible to enter the video game industry again. He joins Videa and renames the company Sente Games, another Go reference (this time to "checkmate"). Sente forms a partnership with Midway games and releases arcade titles such as the simple but addicting hockey game Hat Trick. Unfortunately, the partnership never finds a niche in the market.

Atari Top Secret
In March, Atari announces a new top-secret project code-named the Falcon Project. The Falcon Project turns out to be a new Atari division called Ataritel, which is Atari's attempt to enter the telecommunications market.

Video Games Are Back 1985-1988


The Nintendo Entertainment System.

Famicoming to America
Nintendo test-markets its Nintendo Entertainment System (NES) in New York. Retailers are so skeptical about video games that Nintendo has to agree to buy back all unpurchased inventory. Armed with a large number of Nintendo-developed original titles and arcade games, the NES is a hit in a limited market release.

Atari Goes up Against Apple
Following Apple's lead in releasing the Macintosh, Tramiel's Atari mounts a challenge with the 16-bit Motorola 68000-based 520ST, internally dubbed the "Jackintosh."

Russian Conquers World With Puzzle Game
Russian programmer Alex Pajitnov designs Tetris, a simple but addicting puzzle game that can be played on PCs.


Nintendo Releases the NES Nationwide
Satisfied by the system's success in New York, Nintendo markets the NES nationwide. The system debuts with Super Mario Bros., an arcade conversion, which becomes an instant hit.

The Sega Master System.

Sega Releases NES Competition
Following the successful American introduction of the NES, Sega releases its Sega Master System (SMS) in the United States.

The Atari 7800.

Atari Reintroduces Game Consoles
Following the success of the NES, Atari Corp reevaluates the popularity of video games and decides to release the 7800 game console.

Good Nintendo News
Nintendo outsells its competitors 10 to 1 in the United States. In Japan it unveils a disk drive peripheral for the Famicom, along with The Legend of Zelda and golf and soccer games.

Nintendo Adds New Licensees
Several companies sign on with Nintendo as third-party developers, and most of Atari's old supporters, such as Namco, are now making their best games for Nintendo's system.


Cart-size competition.

New Software
Nintendo's hold on the market grows, crowding out Sega and Atari. Atari releases games for the 2600, which are all but ignored by the press, and releases ports for the 7800--Namco's Galaga and Dig Dug, Williams' Robotron: 2084 and Joust, Electronic Arts' 1983 basketball game One-on-One Basketball, and Atari's own Asteroids and Centipede--that everyone has seen before. Nintendo releases The Legend of Zelda on a cartridge in the United States after deciding not to bring the expensive Famicom disk drive peripheral into the American marketplace. Games such as Kid Icarus and Metroid are released, offering enhanced NES graphics and longer quests.

Tonka Distributes Sega Games
Toy-truck company Tonka purchases the US distribution rights to the SMS and gets it into more stores than Sega did, allowing it to better compete against the NES.

The Atari XE.

Atari Repackages Computer as Game Console
Atari releases the Atari XE Game System (XEGS), which is basically a repackaging its old 800 computer. The XEGS uses cartridges compatible with Atari's dying 8-bit XE computer line and includes two games (Barnyard Blaster and Flight Simulator II), a light gun, and a detachable keyboard. The unit sinks quickly.

NEC Releases "16-Bit" Console in Japan
NEC releases the PC-Engine in Japan and touts it as a 16-bit machine. Actually, the console features a 16-bit graphics processor.


Atari Releases Games for the NES
Atari Games establishes Tengen, a subsidiary that produces games for home consoles. Tengen begins as a licensed third-party developer of NES-compatible games. This role ends when Atari Games takes Nintendo to court, claiming that Nintendo has an illegal monopoly on the video game industry, achieved through illegal practices, such as fixing prices and using computer-chip lockout technology to prohibit unlicensed development of NES software.

Tengen Bypasses Nintendo "Lockout" Chip
Tengen discovers a way to produce NES-compatible games without Nintendo's approval and announces that it will develop, manufacturer, and distribute NES-compatible games without Nintendo's blessing.

Coleco Files for Bankruptcy
Unable to recover from the disastrous Adam, Coleco files for bankruptcy. Most of its catalog goes to Milton Bradley and Parker Brothers.

The Home Market Expands 1989-1992


Tengen's Tetris.

Tetris Troubles
Tengen acquires the home rights to Tetris and begins selling the extremely popular game. However, it is quickly discovered that Tengen bought the rights from Mirrorsoft, which did not own the rights in the first place. Nintendo quietly acquires the legitimate home rights to Tetris and releases it under its own label. The Tengen version is removed from the marketplace.

The Nintendo Game Boy.

Nintendo Introduces Monochrome Game Boy
Nintendo releases its handheld Game Boy ($109). The system comes with Tetris, and despite a tiny monochrome screen, it begins to build a historic sales record. A Game Boy version of Super Mario (Super Mario Land), a Breakout clone (Alleyway), and a baseball game are quickly released.

The TurboGrafx-16.

NEC Releases "16-Bit" Console in America
NEC brings the PC-Engine to America and calls it the TurboGrafx-16 ($189). NEC also releases a $400 portable CD player that attaches to the TurbroGrafx-16 and plays games that are, for the first time, stored on compact discs.

Sega Releases 16-Bit Genesis
Sega releases the 16-bit Genesis in the United States after limited success in Japan. The $249 system is packed with a conversion of the arcade game Altered Beast. Early marketing efforts push the system as a true arcade experience that's substantially better than previous home game machines.

The Sega Genesis.

Atari Releases Handheld Lynx
Epyx displays a handheld color console called the Handy Game at the winter CES. Atari purchases the rights to the Handy Game and releases it as the Lynx ($149). After publishing a handful of great Epyx games, Atari begins to develop a number of 7800 game conversions and Atari Games arcade ports for the system. More expensive than the Game Boy, the Lynx suffers from a lack of third-party support and is plagued by constant rumors that Atari will stop supporting the system.


Super Mario Bros. 3.

Good Year for Nintendo
Nintendo releases Super Mario 3, the all-time best-selling video-game cartridge. Despite competition from the Genesis and TurboGrafx-16, the NES enjoys its best year. Nintendo of Japan unveils its Super Famicom, a 16-bit system with better audio and 3D graphics than the Genesis and TurboGrafx-16. Super Mario 4: Super Mario World is offered to Japanese gamers, who rush to stores to buy the game.

Video Game Rental Dispute
Nintendo and Blockbuster go to court over video game rentals, with Nintendo maintaining that the rentals are destroying its sales. When the courts decide the games can be rented, Nintendo strikes another blow by claiming that Blockbuster illegally copied the copyrighted game-instruction manuals. This time the courts side with Nintendo.

SNK, a long-time Nintendo developer and maker of such games as the three Ikari Warriors releases and Crystalis, releases the 24-bit NeoGeo in arcade and home formats. The graphics and sounds crush those of the Genesis and TurboGrafx-16, but the $399 retail price crushes the NeoGeo's sales.

Sega Arcade Hits Continue to Come Home
Sega continues to turn out games to trade on its established arcade successes. Afterburner II, E-SWAT, and other Sega arcade hits come home, and Sega secures the Genesis rights to Capcom's largely unknown but amazing platform game Strider, which wins game of the year honors at various publications.

NEC Releases Handheld TurboGrafx-16
NEC releases the TurboExpress ($299.95), a handheld TurboGrafx-16 with a separately sold TV tuner. This is the first time a portable game machine can play a dedicated console's games.

Commodore CDTV
Commodore announces its CDTV (Commodore Dynamic Total Vision). Basically a Commodore computer without a keyboard, the CDTV is the first of several home interactive systems that stress education software as well as games. The software is sold on compact discs rather than cartridges.

The 32-Bit Era Begins 1993-1997


The Panasonic 3DO.

Panasonic Releases 3DO Console
Panasonic is the first company to market 3DO hardware. Initial reviews are enthusiastic. The only drawback is the console's $699 price tag.

The Atari Jaguar.

Atari Launches Jaguar
Atari decides to bypass the 32-bit generation and go right ahead to 64 bits. The company launches the Jaguar, which Atari proclaims to be the first 64-bit game console due to its 64-bit system bus. Atari stresses the fact that the Jaguar is made in the US (by IBM).

New Systems From Nintendo and Sega
Nintendo and Sega announce their next-generation systems. Nintendo's Project Reality is a 64-bit system developed by Silicon Graphics. Sega's Saturn will be a 32- or 64-bit system.

Mortal Kombat.

Congress Notes Video Game Violence
Incensed by the violence in Mortal Kombat and Night Trap, Senators Joseph Lieberman (Connecticut) and Herbert Kohl (Wisconsin) launch a Senate "investigation" into video game violence, threaten to somehow effect a ban on "violent" games, and eventually soften their demands and concede to an industry-wide rating system.


ESRB Is Established
The Entertainment Software Rating Board (ESRB) is established to rate video games. Large letter icons appear on game boxes to let consumers know the recommended age of players for each game and whether the game is violent or risqué.

Nintendo Pushes 16-Bit Machine
Nintendo releases Super Metroid and begins a push to regain control of the 16-bit market. New Super-FX chip games, such as Star Fox, are supposed to aid the company's efforts against Sega and its upcoming 32- or 64-bit machine. Nintendo also releases Donkey Kong Country to a stunned crowd at a trade show (the crowd had been expecting news on the new Nintendo 64-bit game machine) and thus demonstrates that even the slow CPU of the Super NES can compete with the 3DO and Jaguar. Donkey Kong Country is the runaway best-selling game of the year, and Nintendo sales nearly catch up to Genesis sales.

The Sega 32X.

Sega Releases 32-Bit Console (Sort of)
Sega releases the 32X ($179), a peripheral that enables the Genesis to run a new set of 32-bit cartridge games, in an attempt to stave off early sales of the Atari Jaguar and Panasonic 3DO machines. Ports of its arcade polygonal games, Virtua Racing and Star Wars, are received favorably, as is a version of id Software's Doom, but Sega licensees remain mysteriously uncommitted to the format, and all the Sega games announced for release bear the fingerprints of Sega of America marketing-and-development efforts. No one seems to know what the company is planning to do with the machine in the future, and Sega seems almost unprepared to release the machine in Japan at all.

Nintendo Releases Super Game Boy
Nintendo releases the Super Game Boy ($59), an adapter that lets Game Boy cartridges play on the SNES with extra features.

New Japanese Consoles Are Released
The Sega Saturn and Sony PlayStation are launched in Japan. By year's end, critics are pointing to the PlayStation as the superior machine.

The Modern Age 1998-1999


The Sega Dreamcast.

New Sega Console
Although Sega officially acknowledges its new 128-bit system, the system's name continues to be elusive throughout most of the year. Originally code-named Dural and Black Belt, the system is officially named Katana in early 1998. At the same time Sega discloses that the new system will use a Microsoft Windows CE operating system, which will mean easier game conversions to and from the PC.

The Katana is displayed in May, and one unique aspect of it is its Visual Memory System (VMS), a memory device that plugs into the controller but can also be used as a stand-alone game device with Tamagotchi-like graphics.

As the year progresses, Sega announces that the Katana will be released in Japan in November. Although the US won't get the new system until 1999, Sega of America begins making plans to spend $100 million to launch it. By midyear, Sega announces another name change--this time the system becomes the Dreamcast. With all the hype in place, the Dreamcast finally goes on sale in Japan on November 27. The initial 150,000 systems that are offered for sale are sold immediately, along with 132,000 copies of Virtua Fighter 3.

Dreamcast for the Arcades
Sega announces an arcade version of the Dreamcast. The Naomi arcade machine promises to have the same capabilities as Sega's current Model 3 arcade machines but will be available for one-third of the price. Because the Naomi and the Dreamcast will share the same chipset, converting titles from the arcade to the console will be simple. Even more compatibility is offered, as VMS slots are provided in Naomi machines to transfer data to and from the Dreamcast.

Missing Sega Name
Market research indicates that the brand name is not terribly important to consumers of video game hardware, so Sega elects not to include its name on the Dreamcast. Ironically, Majesco, a New Jersey-based company, determines that the Sega name is important. Majesco licenses the Genesis from Sega and releases a new Genesis 3, with the Sega name as a central part of the packaging. Majesco plans to release inexpensive versions of the Game Gear, Saturn, and Pico. The small company also releases new software for both the Super Nintendo and the Genesis. One of the surprise titles is Frogger, which Majesco had licensed from Hasbro Interactive.

When the Dreamcast is finally released, the Sega name is included on it.

Sega's Problems Continue
Following the cancelled merger between Sega and Bandai, Sega president Hayao Nakayama resigns from his position and is replaced by Sega of America chairman Shoichiro Irimajiri. Other woes beset the troubled Sega as cuts are made throughout the three American divisions: Sega of America, SegaSoft, and Sega Entertainment. Along with the cuts, Sega announces that it is finally throwing in the towel, and it ceases distribution of the Saturn in North America.

The PlayStation 2
Rumors begin early in the year that Sony is hard at work on the PlayStation 2. While Sony is closemouthed at first, bits and pieces concerning the new system begin to emerge from independent developers. By midyear, Sony admits that the new console is indeed in development and that it may be DVD-based if that is practical. The best guess on when the new system will be available is sometime in 2000. By midyear, the rumors are in full force stating that Sony will team up with Toshiba to develop the chipset for the new console. Early predictions indicate that the RISC processor will run at 250MHz, slightly faster than the processor in Sega's Dreamcast. Sony remains mum on the subject.

The New Era: 2000-2001


A NUON-enhanced Samsung DVD player.

VM Labs Delivers
After touting its strengths for three years, VM Labs shows the first NUON-equipped DVD players at CES. Toshiba and Samsung will both sell NUON-equipped DVD players in 2000.

The Indrema L600 Entertainment System.

New Console Makes Debut
A start-up company called Indrema promises to release a new gaming console in 2001. Using a Linux operating system, the Indrema L600 will play games, DVDs, and CDs, and it will even record TV shows on its hard drive.

A Japanese PlayStation 2 with hard drive.

PlayStation 2 Released in Japan
Sony launches the PlayStation 2 in Japan on March 4. In two days, the company sells 1 million consoles--a new record. As is the case with all Japanese launches, gamers begin lining up outside stores two days in advance. Unfortunately, demand exceeds supply and not everybody gets a console, including those who preordered. Robberies of PlayStation 2s are reported.

An Xbox mock-up.

Xbox Officially Announced
The world's worst-kept secret becomes public knowledge after the opening of the Game Developers' Conference in March. Bill Gates delivers the keynote address and officially announces the Xbox to the world. Gates stresses that the Xbox will not be a PC in a console's clothing. Equipped with an Intel 733MHz Pentium III CPU, an Nvidia NV2a 250MHz graphics processor, 64MB of unified RAM, an 8GB hard drive, and out-of-the-box broadband Internet support, the Xbox sends a strong signal to Sony that it intends to be a major player in the console race. The bad news is that the system won't be available until late 2001.

PlayStation 2 Defect (Bad)
Many of the 8MB memory cards that are packaged with the Japanese PlayStation 2 are defective. Since the DVD drivers are housed in the memory card, DVDs cannot be viewed until the memory card is replaced.

A Second PlayStation 2 Defect (Good)
It is soon discovered that PlayStation 2s that are only supposed to play Region 2 DVDs (Japanese and some European) can also play Region 1 DVDs (North American). Sony quickly issues replacement memory cards.



History of video games…


3D gaming

At the beginning of the decade, the only genres of gaming that were predominantly 3-dimensional were role-playing games (RPGs) and first-person shooters (FPSs). The real-time strategy (RTS) genre had seen its first successful 3D release, Homeworld, in 1999, although it wasn't until the 2002 releases of Warcraft III: Reign of Chaos and Age of Mythology that 3D became the standard for the genre.

Computer games

The Sims, released by Maxis in 2000, sold more than 6.3 million copies worldwide by March 22, 2002, to become the best-selling PC game in history, surpassing Myst.[5] After Electronic Arts bought Maxis, the company produced numerous expansions, turning The Sims franchise, which has sold more than 100 million copies worldwide as of April 16, 2008,[6] into the best-selling PC franchise in history as of March 19, 2008.[7]


Interactive gaming


Nintendo has led the market in console interactivity. The handheld Nintendo DS, released in 2004, features a touchscreen. Game interactivity took a major step forward with the introduction of the motion-sensitive Wii Remote with the Nintendo Wii in 2006. The PS3 introduced a tilt-sensitive controller on its release as well.


The 2000s has also seen the implementation of physics engines and increasing in-game interactivity into video gaming. Red Faction, a first-person shooter (FPS) released in 2001 for the PS2 and the PC, features one of the earliest examples of destructible environments in video gaming through its use of "Geo-Mod" technology. Certain sections of walls could be destroyed to provide alternate pathways or reveal hidden locations. Half-Life 2, released in 2004, is widely considered to have revolutionized physics in gaming with its Havok engine, which allowed for what was at the time widespread interactivity with objects in the environment of the game, although very little of the environment was destructible. The Havok engine brought realistic physics implementations to real-time strategy (RTS) with Age of Empires III in 2005. Black, a console FPS released in early 2006, allowed the player's weapons to extensively damage the environment. The PC games Company of Heroes (an RTS), released in late 2006, and Crysis (an FPS), released in 2007, both extended the implementation of physics in video gaming, featuring environments that were nearly entirely destructible and interactive. Since the use of physics engines has greatly increased since around 2004, so has the level of interactivity and destructibility in video games.

Rhythm games

The rhythm game genre took off in the late 1990s with Beatmania in 1997 and Dance Dance Revolution in 1998. Although beginning their lives in arcades, they made the move to the home console market and each spawned a number of sequels and spinoffs. The popularity of rhythm games accelerated in the mid-2000s, led primarily by Guitar Hero, which was released in 2005 and featured a guitar-like controller and licensed soundtracks. Initially available only for the PS2, its sequels have expanded the franchise to include all consoles. The developer of the first two Guitar Hero games went on to create Rock Band in 2007, which expanded the concept to include drums and vocals. Guitar Hero World Tour, released in 2008, added drums and vocals as well, largely in an effort to compete with Rock Band. The independent game Audiosurf, released in 2008, allows the user to play their own mp3 files and maneuver a spaceship-like object across a track to hit the music "notes".


Although massively multiplayer online role-playing games (MMORPGs) began in the 1990s with such titles as Ultima Online (1997), Everquest (1999), and Asheron's Call (1999), during the 2000s, MMORPGs became a dominant genre among PC gaming. Phantasy Star Online, released on the Dreamcast in 2000 and later ported to the Xbox, GameCube, and PC, popularized MMORPGs for consoles, although it remains a PC-dominated genre. MMORPGs feature persistent worlds, player-driven economies, frequent content updates, and massive servers that contain thousands of players. Most MMOs also feature monthly fees to help with the massive costs required to maintain and continually upgrade the games. The MMO genre has gained much of its success by cashing in on previous popular titles (such was the case with Ultima Online and Phantasy Star Online) with such titles as Final Fantasy XI (2002), Star Wars Galaxies: An Empire Divided (2003), World of Warcraft (2004), The Lord of the Rings Online: Shadows of Angmar (2007), Age of Conan: Hyborian Adventures (2008), Warhammer Online: Age of Reckoning (2008), and the in-development titles Star Trek Online, Warhammer 40,000 Online, and Star Wars: The Old Republic. World of Warcraft, released in 2004, has established itself as one of the most popular games on the PC and set what are now the generally-accepted standards for the genre. Lineage II has established a large market outside of the United States, particularly in Asia, and is the second-most popular MMO worldwide.[citation needed] MMOs free of monthly charge, including MapleStory (2003), and Guild Wars (2004) have also proven to be popular.

MMOFPSs have also been developed, although they have not gained nearly the popularity that MMORPGs have. Perhaps the two most successful games of this genre have been World War II Online (2001) and PlanetSide (2003).

Browser-based and Independent Games

By the early 2000s, the Internet was viable as the sole distribution platform for game developers, which enabled a smaller scale of commercial development than in the past. New markets formed around these newer, cheaper publishing methods, with the primary methods used being downloadable and browser-based games.

Independent games were at first associated with the emerging market for casual games, because of the perceived low budget of most casual games, but over the course of the decade, casual games rapidly grew into capital-intensive productions, with titles such as Bookworm Adventures costing over half a million USD to produce. Today, independent games are more often associated with art games.

Games as downloadable computer programs were not a new concept in this decade; however, gaming within the browser, using HTML, Java, Javascript, and Flash, became increasingly viable over the course of the 2000s as the browser and computer technology improved. Browser-based games have mostly avoided packaged-goods-for-sale business models in favor of advertising/sponsorship, subscription, and microtransactions.

The phenomena of user-created modifications (or "mods") for games was one trend that began around the turn of the millennium. The most famous example is that of Counter-Strike; released in 1999, it is still the most popular online first-person shooter, even though it was created as a mod for Half-Life by two independent programmers. Eventually, game designers realized the potential of mods and custom content in general to enhance the value of their games, and so began to encourage its creation. Some examples of this include Unreal Tournament, which allowed players to import 3dsmax scenes to use as character models, and Maxis' The Sims, for which players could create custom objects.

Mobile games

Mobile gaming interest was raised when Nokia launched its N-Gage phone and handheld gaming platform in 2003. While about two million handsets were sold, the product line was seen as not a success and withdrawn from Nokia's lineup. Meanwhile many game developers had noticed that more advanced phones had color screens and reasonable memory and processing power to do reasonable gaming. Mobile phone gaming revenues passed 1 billion dollars in 2003, and passed 5 billion dollars in 2007, accounting for a quarter of all videogaming software revenues. More advanced phones came to the market such as the N-Series smartphone by Nokia in 2005 and the iPhone by Apple in 2007 which strongly added to the appeal of mobile phone gaming. In 2008 Nokia revised the N-Gage brand but now as a software library of games to its top-end phones. At Apple's App Store in 2008, more than half of all applications sold were games for the iPhone.

Sixth generation consoles (1998-2004)

Main article: History of video game consoles (sixth generation)

In the sixth generation of video game consoles, Sega exited the hardware market, Nintendo fell behind, Sony solidified its lead in the industry, and Microsoft developed a gaming console.


The generation opened with the launch of the Dreamcast in 1998. It was the first console to have a built-in modem for Internet support and online play. While it was initially successful, sales and popularity would soon begin to decline with contributing factors being Sega's damaged reputation from previous commercial failures, software pirating, and the overwhelming anticipation for the upcoming Playstation 2 at the time. Production for the console would discontinue in most markets by 2002 and would be Sega's final console before they switched into becoming third party.


The second release of the generation was Sony's Playstation 2, which would go on to be the best selling console at the time. Nintendo followed a year later with the Nintendo GameCube, their first disc-based console. Though more or less equal with Sony's system in technical specifications, the Nintendo GameCube suffered from a lack of third-party games compared to Sony's system, and was hindered by a reputation for being a "kid's console" and lacking the mature games the current market appeared to want.

The Xbox, Microsoft's entry into the video game console industry.

Before the end of 2001, Microsoft Corporation, best known for its Windows operating system and its professional productivity software, entered the console market with the Xbox. Based on Intel's Pentium III CPU, the console used much PC technology to leverage its internal development. In order to maintain its hold in the market, Microsoft reportedly sold the Xbox at a significant loss[45] and concentrated on drawing profit from game development and publishing. Shortly after its release in November 2001 Bungie Studio's Halo: Combat Evolved instantly became the driving point of the Xbox's success, and the Halo series would later go on to become one of the most successful console shooters of all time. By the end of the generation, the Xbox had drawn even with the Nintendo GameCube in sales globally, but since nearly all of its sales were in North America, it pushed Nintendo into third place in the American market. In 2001 Grand Theft Auto III was released, popularizing open world games by using a non-linear style of gameplay. It was very successful both critically and commercially and is considered a huge milestone in gaming.


Nintendo still dominated the handheld gaming market in this generation. The Game Boy Advance in 2001, maintained Nintendo's market position. Finnish cellphone maker Nokia entered the handheld scene with the N-Gage, but it failed to win a significant following.

Console gaming largely continued the trend established by the PlayStation toward increasingly complex, sophisticated, and adult-oriented gameplay. Most of the successful sixth-generation console games were games rated T and M by the ESRB, including many now-classic gaming franchises such as Halo and Resident Evil, the latter of which was notable for both its success and its notoriety. Even Nintendo, widely known for its aversion to adult content (with very few exceptions most notably Conker's Bad Fur Day for the Nintendo 64), began publishing more M-rated games, with Silicon Knights's Eternal Darkness: Sanity's Requiem and Capcom's Resident Evil 4 being prime examples. This trend in hardcore console gaming would partially be reversed with the seventh generation release of the Wii.

Return of alternate controllers

One significant feature of this generation was various manufacturers' renewed fondness for add-on peripheral controllers. While novel controllers weren't new, as Nintendo featured several with the original NES and PC gaming has previously featured driving wheels and aircraft joysticks, for the first time console games using them became some of the biggest hits of the decade. Konami introduced a soft plastic mat versions of its foot controls for its Dance Dance Revolution franchise in 1998. Sega's alternate peripherals included Samba De Amigo's maraca controllers. Nintendo introduced a bongo controller for a few titles in its Donkey Kong franchise. Publisher RedOctane introduced Guitar Hero and its distinctive guitar-shaped controllers for the PlayStation 2.

Online gaming rises to prominence

As affordable broadband Internet connectivity spread, many publishers turned to online gaming as a way of innovating. Massively multiplayer online role-playing game (MMORPGs) featured significant titles for the PC market like EverQuest, World of Warcraft, and Ultima Online. Historically, console based MMORPGs have been few in number due to the lack of bundled Internet connectivity options for the platforms. This made it hard to establish a large enough subscription community to justify the development costs. The first significant console MMORPGs were Phantasy Star Online on the Sega Dreamcast (which had a built in modem and after market Ethernet adapter), followed by Final Fantasy XI for the Sony PlayStation 2 (an aftermarket Ethernet adapter was shipped to support this game). Every major platform released since the Dreamcast has either been bundled with the ability to support an Internet connection or has had the option available as an aftermarket add-on. Microsoft's Xbox also had its own online gaming service called Xbox Live. Xbox Live was a huge success and proved to be a driving force for the Xbox with games like Halo 2 that were overwhelmingly popular.

Rise of casual PC games

Beginning with PCs, a new trend in casual gaming, games with limited complexity that were designed for shortened or impromptu play sessions, began to draw attention from the industry. Many were puzzle games, such as Popcap's Bejeweled and Diner Dash, while others were games with a more relaxed pace and open-ended play. The biggest hit was The Sims by Maxis, which went on to become the best selling computer game of all time, surpassing Myst.[46]


Other casual games include Zynga Games like Mafia Wars, FarmVille, Cafe World, among many others, which are tied into social networking sites such as Myspace and Facebook. These games are offered freely with the option buy in game items, and stats for money and/or reward offers.

Seventh generation consoles (2004-present)

Main article: History of video game consoles (seventh generation)

The generation opened early for handheld consoles, as Nintendo introduced their Nintendo DS and Sony premiered the PlayStation Portable (PSP) within a month of each other in 2004. While the PSP boasted superior graphics and power, following a trend established since the mid 1980s, Nintendo gambled on a lower-power design but featuring a novel control interface. The DS's two screens, one of which was touch-sensitive, proved extremely popular with consumers, especially young children and middle-aged gamers, who were drawn to the device by Nintendo's Nintendogs and Brain Age series, respectively. While the PSP attracted a significant portion of veteran gamers, the DS allowed Nintendo to continue its dominance in handheld gaming. Nintendo updated their line with the Nintendo DS Lite in 2006, the Nintendo DSi in 2008 (Japan) and 2009 (Americas and Europe), and the Nintendo DSi XL while Sony updated the PSP in 2007 and again with the smaller PSP Go in 2009. Nokia withdrew their N-Gage platform in 2005 but reintroduced the brand as a game-oriented service for high-end smartphones on April 3, 2008.[47]


Apple Inc. entered the realm of mobile gaming hardware with the release the App Store for the iPhone and iPod Touch in the summer of 2008. The greatest shift brought by Apple's entry was to abandon the traditional reliance on "brick and mortar" retail sales for software purchases; instead, the iPhone platform relies entirely on digitally-distributed content.

In console gaming, Microsoft stepped forward first in November 2005 with the Xbox 360, and Sony followed in 2006 with the PlayStation 3, released in Europe in March 2007. Setting the technology standard for the generation, both featured high-definition graphics, large hard disk-based secondary storage, integrated networking, and a companion on-line gameplay and sales platform, with Xbox Live and the PlayStation Network, respectively. Both were formidable systems that were the first to challenge personal computers in power (at launch) while offering a relatively modest price compared to them. While both were more expensive than most past consoles, the Xbox 360 enjoyed a substantial price edge, selling for either $300 or $400 depending on model, while the PS3 launched with models priced at $500 and $600. Coming with Blu-ray and Wi-Fi, the PlayStation 3 was the most expensive game console on the market since Panasonic's version of the 3DO, which retailed for little under 700USD.[48]


Nintendo would release their Wii console shortly after the PlayStation 3's launch, and the platform would put Nintendo back on track in the console race. While the Wii had lower technical specifications (and a lower price) than both the Xbox 360 and PlayStation 3,[49] its new motion control was much touted. Many gamers, publishers, and analysts initially dismissed the Wii as an underpowered curiosity, but were surprised as the console sold out through the 2006 Christmas season, and remained so through the next 18 months, becoming the fastest selling game console in most of the world's gaming markets.[50]


In June 2009, Sony announced that it would release its PSP Go for 249.99USD on October 1 in Europe and North America, and Japan on November 1. The PSP Go was a newer, slimmer version of the PSP, which had the control pad slide from the base, where its screen covers most of the front side.[51]

Increases in development budgets

With high definition video an undeniable hit with veteran gamers seeking immersive experiences, expectations for visuals in games along with the increasing complexity of productions resulted in a spike in the development budgets of gaming companies. While many game studios saw their Xbox 360 projects pay off, the unexpected weakness of PS3 sales resulted in heavy losses for some developers, and many publishers broke previously arranged PS3 exclusivity arrangements or cancelled PS3 game projects entirely in order to cut losses.[citation needed]

Nintendo capitalizes on casual gaming

Meanwhile, Nintendo took cues from PC gaming and their own success with the Nintendo Wii, and crafted games that capitalized on the intuitive nature of motion control. Emphasis on gameplay turned comparatively simple games into unlikely runaway hits, including the bundled game, Wii Sports, and Wii Fit. As the Wii sales spiked, many publishers were caught unprepared and responded by assembling hastily-created titles to fill the void. Although some hardcore games continued to be produced by Nintendo, many of their classic franchises were reworked into "bridge games", meant to provide new gamers crossover experiences from casual gaming to deeper experiences, including their flagship Wii title, Super Mario Galaxy, which in spite of its standard-resolution graphics dominated critics' "best-of" lists for 2007. Many others, however, strongly criticized Nintendo for its apparent spurning of its core gamer base in favor of a demographic many warned would be fickle and difficult to keep engaged.

Motion control revolutionizes game play

The way gamers interact with games changed dramatically, especially with Nintendo's wholesale embrace of motion control as a standard method of interaction. The Wii Remote implemented the principles to be a worldwide success. To a lesser extent, Sony experimented with motion in its Sixaxis and subsequent DualShock 3 controller for the PS3, while Microsoft continually mentioned interest in developing the technology for the Xbox 360, such as Project Natal. While the Wii's infrared-based pointing system has been widely praised, and cited as a primary reason for the success of games such as Nintendo's Metroid Prime 3: Corruption and EA's Medal of Honor: Heroes 2. Despite the success of these titles, reliable motion controls have been more elusive, with even the most refined motion controls failing to achieve true 1-to-1 reproduction of player motion on-screen. Some players have even found that they must move slower than they would like or the Wii will not register their movements, but this is rare. Nintendo's 2008 announcement of its Wii MotionPlus module intends to address these concerns.


Alternate controllers also continue to be important in gaming, as the increasingly involved controllers associated with Red Octane's Guitar Hero series and Harmonix's Rock Band demonstrate. In addition to this, Nintendo has produced various add-on attachments meant to adapt the Wii Remote to specific games, such as the Wii Zapper for shooting games and the Wii Wheel for driving games.[52] With the introduction of the Balance Board in Nintendo's Wii Fit package, motion controls have been extended to players' feet. Third party efforts from THQ, EA, and other publishers that integrate Nintendo's Balance Board are expected in 2009.


At Electronic Entertainment Expo 2009, Microsoft and Sony each presented their own new motion controllers: Project Natal (later renamed Kinect) and PlayStation Move, respectively.[53]

Cloud Computing comes to games

In 2009, a few cloud computing services were announced targeted at video games. These services allow the graphics rendering of the video games to be done away from the end user, and a video stream of the game to be passed to the user. OnLive allows the user to communicate with their servers where the video game rendering is taking place.[54][55] Gaikai is used entirely in the user's browser, and communicates with servers ideally close to the user.[56]


Main article: 2010s in video gaming

The new decade has seen rising interest in the possibility of next generation consoles being developed in keeping with the traditional industry model of a five-year development cycle. However, in the industry there is believed to be a lack of desire for another race to produce such a console.[57] Reasons for this include the challenge and massive expense of creating consoles that are graphically superior to the current generation, with Sony and Microsoft still looking to recoup development costs on its current consoles. The focus for new technologies is likely to shift onto motion-based peripherals, such as Microsoft's Kinect and Sony's PlayStation Move.


One new console is Nintendo's new handheld: the successor to the Nintendo DS known as the Nintendo 3DS.[58] The system is due for release by the end of the fiscal year (March 2011).[59] The system will incorporate 3D graphics and effects without the need for using 3D glasses. Other features include three cameras (one internal and a dual 3D external set), a motion sensor, a gyro sensor and a Slide Pad that allows 360-degree analog input.[60] Sony is also using 3D technology, with some PS3 games compatible with their 3D TV, the Sony Bravia, also using 3D glasses.


On June 14, 2010, during E3, Microsoft revealed their new Xbox 360 console referred to as the Xbox 360 S or Slim. Microsoft's made the unit smaller and quieter, while also installing a 250GB hard drive and built-in 802.11n WiFi.[citation needed] It starting shipping to US stores the same day, not reaching Europe until July 13. © 2010-2017 Phlume Artist Management LLC. All rights Reserved.
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