The Ultimate History of Video Games: From Pong to Pokémon and Beyond—The Story Behind the Craze That Touched Our Lives and Changed the World

by Steven Kent

  When you have two competitors as firmly entrenched as Sega and Nintendo, which are both great companies, make no mistake about it, you have to differentiate yourself. I think we did that.

  —Jim Whims

  In the meantime, things unraveled for 3DO and Atari. As far as the public was concerned, Nintendo had blown a hole in 3DO’s claims of technological superiority with Donkey Kong Country. In 1995, Crystal Dynamics released a game about a wise-cracking Hawaiian lizard called Gex that brought the same highly polished graphical look to 3DO and supplemented it with the voice files that would never have fit in a Super NES cartridge. Standup comedian Dana Gould performed the voice-over for Gex, the main character, giving the game a certain charismatic wit. Realizing that Gex was the most surefire game in the 3DO lineup, Panasonic bundled it with their company’s version of the console.*

  Gex and other highly improved games were not enough; 3DO had lost its position as the most desirable game console the moment Tom Kalinske announced that Saturn had already shipped. By the time Sony launched in September, the only tricks 3DO manufacturers Panasonic and GoldStar had left were to offer rebates and to bundle more software. As one GoldStar print ad stated, “The GoldStar 3DO system is jammed full of space-age technology and comes with lots of FREE stuff.”

  3DO’s window of dominance had been shut, and, in his own evangelical way, Hawkins helped close it. Seeing that there was no way to compete with Sega and Sony, he began talking about the disappointment of the 32-bit generation and the real strengths that 64-bit processing had to offer. Hawkins changed his focus to M2, a 64-bit console that he promised would shame PlayStation and Saturn. M2 never materialized. 3DO sold the technology to Matsushita for $100 million, and though many game companies did receive M2 development kits, no M2 systems were ever released.

  Things were even worse at Atari. Atari president Sam Tramiel struggled to find ways to bolster sales and cut costs. In 1995, he stopped manufacturing Jaguars and concentrated entirely on selling off the existing inventory. He slashed the price of the console to $149, released an attachable CD-ROM peripheral, and openly courted new game developers. He ran infomercials to try and sell additional consoles, but the infomercials did not reach the right audience. Toward the end of 1995, Atari finally convinced Wal-Mart to carry Jaguar in its superstores, but by that time people knew about Saturn and PlayStation and weren’t interested. Nothing seemed to work. The company was hemorrhaging money. The end came when Sam Tramiel suffered a mild heart attack and his father, Jack, came in to run the show in his absence.

  Sam had just finished riding a bicycle. He got off the bike, felt somewhat faint, felt a pain in his chest, drove himself to the Stanford Medical Center, and there was informed that he had had a mild heart attack.

  Jack came back in [to Atari while Sam was recovering]. Jack knew how bad it was. It wasn’t that Jack didn’t know, Jack knew. Jack knew all the numbers, all the time.

  —Bernie Stolar, president and COO, Sega of America

  Many theories arose about why Jack Tramiel purchased Atari. Some people said that he bought the company as a means for exacting revenge on Commodore, the company that he founded, then left under unpleasant circumstances. Another theory was that he purchased Atari to make one last fortune, enough money to ensure the future of his three sons, Sam, Leonard, and Gary. A third theory suggested that he bought Atari as a way of bringing his sons together. If any of these were his reasons, he succeeded. Atari outlasted Commodore, had a few enormously profitable years, and united his sons in a common goal.

  On July 30, 1996, Atari Corp. merged with JTS Corporation, a company that manufactured 3.5-inch disk drives, in an $80 million stock swap. Jack Tramiel was active on the JTS board after the merger. Two years later, Hasbro Interactive purchased the Atari library from JTS.

  We were trying to license four products, including Centipede, Missile Command, Tempest, and Pong. During the licensing arrangement, we realized that JTS was in financial dire straits, so we decided to take it to a higher level…. we moved very quickly and very aggressively and turned this into an acquisition opportunity. We acquired all of the trademarks, patents, copyrights, and intellectual property for all of Atari. Jack Tramiel was involved in the discussions. He was a tough negotiator, as always, but they needed money. The acquisition cost us $5 million.

  —Tom Dusenberry, president, Hasbro Interactive

  Time Warner put Atari Coin-Op on the sales block in 1996 as well. In an interesting twist, one of the first people to bid on it was Nolan Bushnell, the man who originally had founded the company. Time Warner turned down his offer, however, and sold Atari to a familiar competitor—Williams Manufacturing.

  Nintendo Unveiled

  In late November 1995, Nintendo finally unveiled its 64-bit, cartridge-based game console at its Shoshinkai trade show, held that year in a cavernous, warehouse-like convention center called the Makuhari Messe. As a proprietary show featuring only games for Nintendo systems, Shoshinkai was considerably smaller than E3 or the Tokyo Game Show. The entire show fit into one section of the Makuhari Messe and filled less than two-thirds of the floor.

  Nintendo’s next-generation console underwent three name changes by the time it was unveiled. First known as Project Reality, then Ultra 64, the final name of the console was “Nintendo 64 (N64).” Although Nintendo had released many details about the new console during the months leading up to the unveiling, no information was ever leaked about the system’s controller. Created by Genyo Takeda and Nintendo Research and Development Team 3, N64 had a new and revolutionary three-handled controller that featured both a traditional digital directional pad and a new analog directional lever. The T-pad, which was especially good for fighting games, worked a lot like a light switch. It did not read how hard you pushed, it simply noted when you pushed down on it and from what direction you pushed, then moved you in that direction at a constant speed. The analog lever, on the other hand, responded to pressure. Push slightly to the right, and the character you were controlling would inch in that direction. Push the lever all the way over, and your character would run at full tilt.

  We tried a motion sensor wristwatch-style controller. We made a prototype and applied for a patent. Everything was good, but players didn’t understand the internal mechanism and had trouble controlling it, so we abandoned it.

  —Genyo Takeda, manager R&D Team 3, Nintendo Co., Ltd.

  Hiroshi Yamauchi was clearly proud of the new controller. In a lengthy speech given the first day of the show, he said, “If you think this is just another game pad, then you know nothing about video games.”

  Most of the floor space was dedicated to Super Famicom (the Japanese name for Super NES), with a fairly large section for Game Boy and a much smaller corner of the floor for N64. Obviously, most people at the show crammed in around the N64 area, taking turns playing the only two games on display—Super Mario 64 and Kirby’s Air Ride. Although the show ran smoothly, it was obvious that some decisions had not been made until the morning of the show. When an American reporter emerged from the N64 area, Howard Lincoln approached him and asked what he thought of the game. “The Mario game was great, but that other game wasn’t amazing.”

  “We’re only showing one game,” replied Lincoln, who had not been told about a last-minute decision to show Kirby’s Air Ride.

  The Last Days of Yokoi

  Across the floor of Makuhari Messe, in the corner farthest away from N64, Gumpei Yokoi manned the little booth where Virtual Boy was being displayed. As he always appeared when in public, Yokoi was impeccably dressed in a dark suit, crisp white shirt, and modest red tie. He was a thin man with narrow shoulders whose head always appeared slightly large for the tiny frame of his body. The touches of white along his temples added to his dignified air. Few people stopped by his booth, so Yokoi was able to personally demonstrate games to those who did.

  This was his punishment, the Japanese corporate version of Dante’s Inferno. Gumpei Yokoi, the engineer who had created Ni
ntendo’s first toys in his spare time, had been placed in the proverbial doghouse for creating the debacle that was Virtual Boy. Having received shipments of Virtual Boy less than one year earlier, Tokyo stores were now discounting it so heavily that customers could buy it for less than $100—under half the original cost.

  When employees make high-profile mistakes in Japan, it is not unusual for their superiors to make an example out of them for a period of time, then return them to their former stature. Such seemed to be the case with Yokoi. Yamauchi would pretend to have forgotten that Game Boy, Metroid, and Dr. Mario had all come from Yokoi’s team; would leave him to man a booth with a dying product; then eventually would bring him back into grace. So, armed with Bound High, a first-person perspective game in which players sat inside a bouncing ball and tried to steer it, and an adventure game called Dragon Hopper, Yokoi greeted buyers and the media and cheerfully tried to explain that there was still life in Virtual Boy. Not many people came by, but he seemed happy to have an audience when they did.

  Yokoi left Nintendo the following August, after spending nearly thirty years with the company. He started his own handheld game company and named it Koto, a word meaning “small town.” (It is also the name of a classical Japanese string instrument.) His company’s first project was a monochrome handheld game system that was similar to Game Boy but slimmer and with a better speaker and a larger screen. Eventually named Wonder Swan, Yokoi’s new game system had other nice touches, too. It had directional pads in two different corners so that it could be used to play games with either vertical or horizontal orientation. It also operated on a single AA battery. Yokoi licensed the new handheld to Bandai, Japan’s largest toy manufacturer.

  On October 4, 1997, Yokoi and a friend were involved in a small accident on the Horukiko Expressway in Kyoto when they rear-ended another car. Both men climbed out to inspect the damage and were struck by a passing car. While his friend suffered fractured ribs, Yokoi sustained much more serious injuries and died two hours later. As the father of Game Boy, his death attracted a lot of media attention. In the United States, Yokoi’s obituary was read on National Public Radio and appeared in the New York Times and People magazine.

  In 1999, Bandai released a new handheld video game system called “Wonder Swan.” Though obsolete compared to Game Boy Color, Wonder Swan was launched with some fanfare. One of the first games for the new handheld was a curious strategy game in which players tried to complete circuits of lines by adding tiles with junctions. The game was called Gunpei.*

  * Dave Theurer, the Atari designer who created Missile Command and Tempest, introduced 3D polygons into arcades in his 1984 game I*Robot. Suzuki openly admits that he got the idea of using his technology in a driving game after seeing a 3D racing game called Hard Drivin’, which Atari released in 1989.

  * An interesting story lies behind Yoshi’s Island. When Shigeru Miyamoto first demonstrated the game to Nintendo’s marketing department, it was rejected because it had Mario-related graphics rather than the waxy, prerendered graphics of Donkey Kong Country. Rather than change to an artistic look he did not like, Miyamoto made the game even more cartoon-like, giving it a hand-drawn look. The second version was accepted.

  Miyamoto, who is rightfully proud of his work, was offended that the first version was rejected. That same month, I interviewed Miyamoto and Tim Stamper, creator of Donkey Kong Country, together and noticed that Miyamoto was a bit hard on Stamper, making such statements as “Donkey Kong Country proves that players will put up with mediocre gameplay as long as the art is good.”

  In a later interview, Miyamoto admitted that Yoshi’s Island had been a touchy subject at the time:

  I think that it happened after Donkey Kong Country was introduced. In comparison with the graphics of the Super Donkey Kong, there was not enough punch to Yoshi’s Island. That was what I was told by the marketing people.

  I intensified my hand-drawn touch on Yoshi’s Island from the initial part of the program. Everybody else was saying that they wanted better hardware and more beautiful graphics instead of this art.

  Even while I was working on the Super Mario World, I was thinking that the next hero should be Yoshi. Other people have created games based upon Yoshi…. Yoshi’s World Hunters, Yoshi’s Egg, Yoshi’s Cookie, and so forth—games that I don’t really like. So I decided that I should make an authentic Yoshi game.

  * Once, while visiting a game store, Gould asked if a clerk had Gex. “It’s pronounced Jex,” the clerk replied. “it’s about a dinosaur.”

  * Several people who have written about Yokoi have used an “n” instead of an “m” when spelling his first name. Although his name appeared with an “m” on his business card, David Sheff chose to use the “n” in Game Over, which may be a more appropriate representation of his name.

  The Mainstream and All Its Perils

  Things are the same as usual here. Dudley’s diet isn’t going too well. My aunt found him smuggling doughnuts into his room yesterday. They told him they’d have to cut his pocket money if he keeps doing it, so he got really angry and chucked his PlayStation out of the window. That’s a sort of computer thing you can play games on.1

  —Harry Potter, Fledgling Wizard

  Since 1957, in America, the per capita assault rate has gone up seven-fold. In Canada, since 1964, the per capita assault rate has gone up between four- and fivefold. In the last 15 years, in European nations, the per capita assault rate has gone up approximately fivefold, in Norway and Greece, fourfold in Australia and New Zealand. It has tripled in Sweden, and doubled in seven other European nations.

  Now, the only common denominator in all of those nations is that we are feeding our children death and horror and destruction as entertainment. And the worst of these is the violent video games, the simulated training devices.2

  —Congressional testimony, Lieutenant Colonel (retired) Dave Grossman, professor, Arkansas State University, 1999 Senate Hearings

  The Last Great Hope for Arcades

  Steven Spielberg, a longtime fan of video games, made an annual pilgrimage to the Electronic Entertainment Expo (E3), often bringing his children with him. He was said to have several arcade machines in his home and was known to have visited Sega Enterprises in Japan on several occasions. In 1996, three elements came together at one time, creating the opportunity for Spielberg to enter the arcade business in a big way.

  I had been talking to Steven [Spielberg] about doing something in the arcade business for years. Then Steven formed DreamWorks, and Sega’s home game business started getting into trouble, and Nakayama (Hayao Nakayama, CEO of Sega Enterprises) wanted to get more active in coin-op. I had introduced Steven to Nakayama the preceding year, and we were going to do this project, frankly, just with Sega and DreamWorks. Then Universal was sold and they had a friendly owner and joined us.

  But the core idea … a place where an adult wanted to go and could get good food, get Starbucks coffee, a good beer, have good music playing and meet other adults in a place that was attractive and appealing, that idea really had its core in Steven.

  —Skip Paul, cofounder and CEO, Sega GameWorks

  Spielberg found the perfect partner for his arcade ambitions in Skip Paul, a man who had started with Atari as legal counsel and risen to president of the coin-op division. Like Spielberg, Paul was an avid fan of the arcade experience. He also had a great understanding of the video game business. Together, they formed an alliance between Spielberg’s DreamWorks, Sega Enterprises, and Universal Studios, having all three companies throw their weight behind a chain of enormous and trendy entertainment complexes that would feature high-quality restaurants, bars, and enormous arcades. They called the venture “GameWorks.”

  The first GameWorks location, which had more than 35,000 square feet of floor space, opened in downtown Seattle in March of 1997. The opening was treated like a movie premier, with such stars as Will Smith, Gillian Anderson, and Weird Al Yankovic in attendance. MTV broadcast the event live, and
Microsoft chairman Bill Gates walked the floor. The opening of GameWorks was a major press event as well. USA Today, Time, and many other national publications covered it.

  The original GameWorks formula paid homage to the days of classic arcade games by featuring an alcove with two rows of 1980s coin-op machines.* As executives tweaked the GameWorks formula to find the best mix for the public, the classics corner was one of the first casualties.

  After the Seattle debut, GameWorks opened several more locations in such cities as Columbus and Chicago. Although GameWorks was the most high-profile entry into the arcade business, other companies also experimented with location-based entertainment. There were still several Chuck E. Cheese franchises, the pizza parlor-arcades originally created by Nolan Bushnell around the United States. On a more upscale note, Disney opened virtual theme parks called DisneyQuests in Chicago and Orlando. More family-oriented than GameWorks, these high-tech wonderlands featured virtual rides and games with distinctly Disney themes. The most established arcade/eatery company, however, was Dave and Busters, a well-managed chain quietly spreading nationwide.

  The Making of Mario

  Shigeru Miyamoto, creator of Donkey Kong, Mario, Zelda, Yoshi, and Star Fox, entered the video game industry with a unique philosophy that was always reflected in his games. “When you draw a laughing face, your face should laugh,” he once explained in an interview. “When you draw an angry face, your face should be angry. The character will capture your emotion. The emotions and fun in a game are not made while thinking about business.”