On this day in tech history: Forty years ago, this infamous flop of a video game taught us that marketing is no substitute for substance.
Today marks the 40th anniversary of an infamous moment at the intersection of business and tech—at least within the video game world. On September 1, 1983, developer Howard Scott Warshaw completed his final version of the Atari video game based on the summer’s hottest movie: E.T. At the time, Atari was riding an unprecedented wave of success, taking video games from a hobbyist niche to a mainstream industry with huge profits. E.T., meanwhile, was redefining the summer blockbuster and breaking all box office records. What could possibly go wrong? Well, as it turns out, a lot. Given the timing of contract negotiations between Atari and Universal Pictures over the licensing agreement for the game, and the desire to release it in advance of the all-important Christmas shopping season, Warshaw had only 5 weeks to create the game from scratch—a process that typically took 6–12 months. Shortcuts were taken, user testing was skipped, and the game was a mess. Gameplay was nearly impossible and fully devoid of joy, as players tried to navigate a low-res extra-terrestrial through a field of pits that it invariably fell into over and over again. Word spread quickly, and sales numbers widely missed expectations. As a result, Atari’s “E.T.: The Extra-Terrestrial* is frequently cited as one of the worst games of all time. Atari found itself in the unfamiliar position of being long a pile of cartridges that nobody wanted. In what was originally thought to be urban legend (until verified in a documentary 31 years later), nearly a million copies of the company’s unsold inventory—E.T. and others—were secretly buried in a New Mexico landfill and covered with concrete. A cartridge excavated from the landfill currently sits on display at the Smithsonian. The Atari E.T. debacle was one of the major drivers of the video game industry crash of 1983, which put the market in a multiyear tailspin. By the end of the year, Atari had more than $500M in losses, and its parent company sold the console business, which was eventually wound down. Industry performance only started to improve in 1985 when the quality-obsessed Nintendo widely released its game console featuring a lineup of strong, internally generated games and characters (think Super Mario, Zelda, etc.). The business lesson, as always: Don't take your focus off the product. Marketing is important, but nothing else matters if the thing you're selling is crap. (Image Source - Wikipedia, “E.T. the Extra-Terrestrial (video game)”)
