A Brief History of Atari

Have YOU Played Atari Today?

A Brief History of Atari

Atari has been in the video game market almost from the beginning, starting as an innovator of video games, both in the arcades and in the home console market, withstanding the infamous video game crash, becoming mostly just a brand name for publishing, to now releasing a brand new console for the first time in over 20 years. With the new Atari VCS just over the horizon, we at Gaming Historia thought it would be a good time to take a look back at the history of Atari, and to tell that story we need to head back to the year 1971.


Nolan Bushnell, an electrical engineering graduate of the University of Utah and arcade enthusiast, partnered up with Ted Dabney to found Syzygy, a company with the goal of making a clone of Spacewar called Computer Space. Bushnell searched for a manufacturing partner while Dabney created the prototype. After they found a partner in a coin-op company named Nutting Associates, they sold Computer Space; the first commercially available “Video Arcade.” Computer Space , unfortunately, ended up being a loss commercially. After discovering the Syzygy name was already in use, they used the name Atari which was a reference to a move in Bushnell’s favorite game “Go”.

They hired their first design engineer, Al Alcorn, to design an arcade version of the Magnavox Oddesy’s Tennis game that Bushnell saw at the Magnavox Profit Caravan. That game became the Legendary Pong. After a few months of development, Pong was ready. Unbeknownst to Alcorn, this was actually just a test to get him used to creating video games, as Alcorn had no previous experience with them. He went above and beyond, creating difficulty in the form of the ball changing it’s angle depending on which part of the paddle it hit, increasing ball speed, and adding in sound effects. They decided it was ready for testing, so they built a prototype cabinet and put it in Andy Capp’s Tavern, whom they had good working relations with, supplying them pinball machines and the like. The game was a hit and actually started experiencing technical issues due to the coin slot mechanism overflowing with quarters! They knew they had something here and started hatching bigger and better plans.

Then they made another one… and another one… and another one… and another one…

Atari quickly rose to fame with Pong, which they officially announced on November, 29th 1972, and thought about their next step. Well, they decided, why not make another Pong style game? Not so fast. Atari had a pre-existing contract with the company Midway to make a video arcade racing game. Pong had to be put on hold. They created Space Race to fullfil their contract. The game involved you and your opponent racing through an asteroid field. The game flopped and Midway forced Atari, through legal actions, to forfeit all royalties to the game as they said it breached the contract they had since Atari gave the game to Midway under the name Asteroid but produced and sold Space Race (basically identical to Asteroid) on their own. After that, they focused back on what really mattered: Pong. They released quite a few clones of Pong, all with their own modifications to make the games different enough. Over the years there was Pong Doubles, Super Pong, Ultra Pong, Quadrapong, Pin-Pong, and Rebound, just to name a few. This marked the emergence of the video game market as the success of Atari, and (most) of their video arcades, spawned developers copying them for a chance to capitalize on the new market. They released many other games besides Pong clones such as Gotcha, World Cup, and Gran Trak 10. Being sneaky, Atari formed a fake competitor named Kee Games in association with their neighbor Joe Keenan, since people were complaining about exclusive deals for Atari. Kee Games essentially took the Atari games and rebranded and sold them causing the two companies to receive even more money from their games. Quadrapong was released by Kee Games under the name Elimination for example.

Oooh, but it doesn’t end there. Atari came up with a radically new idea: video games at home. They got to work on a home version of Pong and, in association with Sears for marketing and distribution, it flew off the shelves like hot cakes when it was released in 1975. Of course, this resulted in other companies making their own “Home Pong” rip-offs (including a small Japanese toy maker called Nintendo, I doubt you’ve ever heard of them ). This, in turn, resulted in Atari pumping out a bunch of new versions of Home Pong. The market was quickly becoming oversaturated by all these “Pong Consoles”, but Bushnell was hard at work designing something that would change the video game world forever.


Atari, along with tech firm Cyan Engineering, was designing a new type of home console. You see, Pong Consoles only had a few games programmed into the console using programming called logic, but this new system would be CPU based and be able to play any game off specialized “Game Carts” which was inspired by some home computers using carts at the time.

However, competitor Fairchild Semiconductor beat Atari to the punch, releasing a CPU based home console that allowed you to swap your game using game carts, called the Video Entertainment System (VES) which displayed the games on your television and produced sound through the console. Atari was getting worried. The system they had combined the CPU with a ROM-I/O chip and display and sound chips, creating the Television Interface Adaptor. Everything sounded good, but it still was not ready to be released. Nor would it be for quite some time, not having enough capital to fund faster development. In desperation, Bushnell sold Atari to Warner Communications for $28 Million USD in 1976 (that’s almost $95 million in 2018 money) with the promise that the system would be ready as soon as possible. The turning point for the system (codenamed Stella) was when they hired chip designer Jay Miner. He managed to turn the Television Interface Adaptor into a single chip. This was exactly what Atari needed to get Stella out on the market. They named the system the Atari VCS (Video Computer System) in direct competition to Fairchild’s VES.

Dismissal and Re-emergence… and Pizza!

The console was launched on September 11th, 1977 at a price of $199 USD (roughly $800 USD in 2018 money. Still think your PlayStation 4 or Xbox One is too pricey?). It included the system with all hookups, 2 of the now classic controllers, and a game cart labeled Combat. The VCS sold 250,000 units in 1977, but the world was Pong-ed out from the Pong Console race and the VCS sales were not fantastic, as only 550,000 units were sold in 1978 out of the 800,000 that were produced. This caused a big argument between Warner and Bushnell, causing Bushnell to be forced out of the company. Kee Games was disbanded as well but not before he purchased his pet project, Pizza Time Theatre, back from Warner. We will just side step a little here to take a look at Bushnell’s endeavor, as I believe it is important to look at this if we are looking at the history of Atari.

Bushnell wanted to expand the appeal of arcade games to a wider audience, specifically children, as most arcade cabinets at the time were located in pool halls and bars (a fact that, in North America, still holds true after the fall of the arcade). The decision to open a pizza restaurant is said to have been because of the simplicity of it. Pizza is fast to make and hard to screw up. It was decided. They would make a place where kids could go to watch animatronics sign songs, play video games, and eat pizza! This resulted in the famous Chuck E. Cheese’s Pizza Time Theatre. This is where a lot of young children in the 80’s were exposed to the world of video games, doing exactly what Bushnell had hoped for.

Back at Atari, there was an employee working on a project that, unbeknownst to everyone, would save the Atari VCS. That project, by Warren Robinett, was called “Adventure”. Adventure was the first computer adventure game which utilized more than one screen, allowing you to move all over the place and explore. This led developers to realize they were not limited to a single screen and that they could do much, much more than making simple arcade style games. This also led consumers to realize that the VCS was more than another Pong console, and with developers now being able to make more and more advanced games, the VCS started gaining a foothold in the video game market.

Oh, and of course, there was Atari licensing Space Invaders that helped tremendously by increasing sales by 2 million units in 1980. This was also the year that Atari released an updated version of the VCS called the Atari 2600. This is the name everyone remembers the VCS by, as it was the more popular selling version, and the only difference was that they moved 2 of the switches from the front to the back of the console.

Have you played Atari today?

There were so many different versions of the Atari VCS that I’ve decided to dedicate this entire section to that.


Throughout the years of 1977 to 1980 there were two version of the VCS released. The first one is referred to as “The Heavy Sixer” as this model was made with very heavy plastics and had 6 switches on the front. The second one is referred to as “The Light Sixer”. After production moved from California to Hong Kong, the VCS was starting to be produced with thinner and lighter plastic but still had 6 switches on the front.


Between 1980 and 1992, there were 4 versions of the 2600 released. The aforementioned 2600, which is the VCS with only 4 switches on the front, and the “Darth Vader” which is the same as the 2600 but with black plastic instead of a wood panel on the front. Then there was the Atari 2800, a remodel of the 2600 exclusively made for the Japanese market in 1983, which included 4 game ports instead of the 2600’s 2, and new controllers that combined the joystick and the paddle controller into one, but the system failed due to the Nintendo Family Computer (Famicom), that small toy company we mentioned earlier. The last Atari 2600 produced was called the “Atari 2600 Jr.” released in 1986, which was a smaller, more cost-effective version, of the 2600.

1977-1983 ~ SEARS

Atari had a licensing agreement with Sears to sell Atari consoles in their stores with Sears being allowed to release their own versions of the 2600. This resulted in 4 versions released with the Sears name; The Sears Tele-Games “Video Arcade”, with both a “Heavy Sixer” and “Light Sixer” model (they just took the consoles Atari produced and slapped their own labels onto them), a 2600 model (the 4 switch one) and a version of the Japanese exclusive 2800, released as the “Sears Video Arcade II”.

Computers Man!!

Atari only expected the 2600 to last about 3 years on the market before they needed to refresh it so Atari started working on a successor almost as soon as the 2600 was released, codenamed “Super Stella”. During the production of this system, however, there was a huge boom in the electronics market – The Home Computer, and Atari decided that it would be a good idea to capitalize on this. This resulted in what is referred to as the Atari 8-bit Family, which ran from 1979 to 1992. The first Atari computers were the Atari 400 and Atari 800 released in 1979. The numbers in the computers names are in reference to the amount of RAM in them, the 400 having 4KB, and the 800 having 8KB. They were received rather well critically, which is more than can be said for their 3rd mutated half-brother, The Atari 5200.

The 5200, released in November 1982, was supposed to be a higher-end version of the popular 2600 with better graphics, a more advanced controller, 4 player ports instead of 2, and an advanced RF box that would automatically switch the TV to display the game when the console was turned on. Now, you are probably thinking “Hey?! Isn’t this section about the Atari computers? Why are we talking about the 5200?” First off, yes you are right, and to answer your second question, we are talking about the 5200 because the hardware inside the console is almost identical to the 400 and 800 computers as those computers started in development as the 5200 before the decision to enter the home computer market was made.

Unfortunately, the Atari 5200 was not successful due to the system not originally supporting the 2600 library, having a small selection of games (most just being graphical updates of 2600 games), and a horrible controller design, particularly the new advanced analog sticks, which were innovative at the time, but did not re-center. There was a second model of the 5200 released with 2 controller ports, an available adaptor to play Atari 2600 games, and a normal RF box. There was also a planned Atari 5100, which would have been smaller and cheaper, but this was never released.

Back to the world of home computers, Atari was hard at work making their new computers, which were codenamed Liz. Originally there were to be 2 models like with the 400 and 800, but this idea was dropped in favor of just having one model which ended being the 1200XL, coming with 64KB of RAM and a redesigned keyboard. This was, unfortunately, another flop for Atari, as it was not much better than the Atari 800 (which ended up supporting and even coming with up to 48KB of RAM) and was much more expensive. With prices needing to be dropped but production costs being too high and the 1200XL being a failure, they needed to make new computers to replace the more successful 400 and 800 computers. This resulted in the 600XL (replacing the 400) and 800XL (replacing the 800 and 1200XL) which was very similar in looks to the 1200XL, but a bit smaller. There were also 2 higher end models, the 1400XL and 1450XLD, the first included a modem and voice synthesizer, and the latter had those and a double sided floppy disk drive, as well as an option for a second drive. These are failures as well due to multiple manufacturing issues which caused Atari to not meet demand and consumers looking towards other brands such as Commodore, and IBM. It seems that Atari was never fated to sell computers.

Computers by Tramiel

Atari was in trouble. After multiple failures in the home console and home computer markets, the cost to parent company Warner became too much. Atari was made up of three sections; the video game console division, the home computer division, and the arcade division, which reportedly were all independent and did not like to cooperate. Warner decided to sell off Atari due to the losses. Enter Jack Tramiel, a Polish WW2 concentration camp survivor, who at one time owned a company named Commodore, one of the big names in the home computer market, selling the popular Vic 20 and Commodore 64 computers. He was sold the Atari home computer and video game console divisions in 1984, while the arcade division was sold to competitor NAMCO a year later.

Tramiel shut down almost all branch locations and turned combined the two into one, named Atari Corporation.

Atari XE

Atari Corporation was able to stay in business due to their already released hardware and games until they could release their own product, the successor to the 8-bit family, the Atari ST (ST standing for the Sixteen-bit bus and the Thirty Two-bit processor). At the same time they released the Atari ST, they also released another series of computers known as the XE series (a continuation of the 8-bit family) comprised of the 65XE and the 130XE. These computers saw many reliability issues and never gained a huge foothold.

Atari ST

The ST series comprised of a whopping 12 computers; the 520ST (with 512KB of RAM), 520ST+ (with 1MB of RAM), 260ST (a European release with 512KB of RAM), 520STM (a version of the 520ST with a built in TV output), 520STFM (a redesign with a bigger case and a built in drive, something earlier models did not have), 1040STF (a remodel of the 520STFM with 1MB of RAM and built in double sided floppy drive), 1040STFM (the same as the 1040STF with an included RF modulator), the 1040STE (with enhanced sound and a better colour palette), the MEGA ST (same as the 1040STE but with a faster processor and more ports), the STacy (a luggable version of the ST), and the ST Book (a more portable version of the STacy). This series of computers saw quite a bit of success due to mostly having a lower price point than their competitors at the time (seeing a lot of popularity in Europe) but were still outsold by the Commodore Amiga 2 to 3.

Atari IBM PC/MS DOS Compatibles

Atari released 2 computers under their “ABC” line (ABC stands for Atari Basic Computers). These were the Atari ABC 386SX/DX (the DX version just having a faster processor) which ran and came packaged with both MS-DOS 5.0 and Windows 3.0, and the Atari N386SX Laptop which was a reskinned Japanese laptop from a company called SOTEC.

They also released 2 IBMPC compatible computers named the Atari PC-1 and Atari PC-5. I unfortunatly cannot find much information about this series of Atari computers.

Last on our list of the Atari Portfolio, a handheld IBM PC compatible and the world’s first “palmtop computer” which was about the size of a VHS tape (for those younger among my readers, here is a link to the ancient technology of VHS).

Consoles by Tramiel

Atari Corp. under Tramiel did not just focus on the computer market, as they also released video game consoles. The two were both released in 1986, the aforementioned Atari 2600 Jr. (smaller edition of the 2600 with a cheaper price point), and the Atari 7800 (originally going to be named the 3600). The 7800 was nearly fully backwards compatible with the Atari 2600 game library natively (the first console to do this without an adaptor) and had better graphics. This console was actually released in 1984 in California but was limited due to the video game console section of Atari being sold to Tramiel and was not re-released until 1986 due to legal issues over the 7800 between old owner Warner and Tramiel.

The console saw limited success due to the popularity of the Nintendo Entertainment System. The next “home console” (words I use very lightly with this one) is the Atari XEGS, which was released in 1987 which was re-built off the existing architecture of the Atari 65XE 8-bit computer and is compatible with the 8-bit games released for the 8-bit computer family. The reason I say this is not much of a home console is because this is closer to a home computer with more of an emphasis on gaming as you could plug in a special keyboard and still use it as a computer. It was available in two versions; the basic version which came with a joystick, and the deluxe version which included the joystick, keyboard, and a light gun (because every console needed a light gun at this time). The XEGS saw a fair amount of success, reportedly selling 100,000 units during the Christmas 1987 season, which was all that was manufactured.


We are not done with consoles yet! Atari decided to start naming their consoles after cats, which produced 3 products. Originally, there was going to be the “Atari Panther” which was going to be built as a combination of the hardware of the Atari ST and the Atari Transputer Workstation video hardware named Blossom. The Workstation was a computer that was canceled by Atari after only producing a few hundred units in 1989. This was going to be released to compete with the Super Nintendo and Sega Genesis and would be the only 32-bit system in an era of 16-bit systems. They decided to cancel the project as the development team, Flare Technology, convinced Atari to push for 3D graphics. This resulted in the development of the now infamous Atari Jaguar.

The Jaguar was the first 64-bit system, released on November 23rd, 1993, to compete (like the previous cancelled Panther) with the Super Nintendo, Sega Genesis, and a newcomer, the 32-bit 3DO. The Jaguar was sold world wide in 1994, and saw limited sales due to Atari’s bad reputation for unreliable hardware, as well and having little 3rd party support. Things only got worse with the launch of the Sega Saturn and Sony’s first console the PlayStation. 3rd party support was limited, apparently, due to the console being very tedious to program for. In actuality however, the system was found to not be a true 64-bit system as it had 32-bit ‘instruction set’ to a 64-bit processor. Atari attempted to keep the Jaguar alive by releasing the Atari Jaguar CD, a CD attachment for the Jaguar. They even showed off a Jaguar VR (sounds familiar to what is happening with consoles nowadays, having premium add-ons/versions) but ultimately the Jaguar was a failure, no matter how hard Atari tried.

Next is the Atari Lynx, a handheld console which competed with the Nintendo Game Boy and Sega Game Gear. The console was originally developed by game developer and peripheral designer Epyx, but due to financial problems, they partnered with Atari. The Lynx actually saw quite a bit of success in the beginning, but as with all other handhelds, failed in the long run due to the cheaper price point, durability, better battery life, and better game selection of the Game Boy. They attempted to bring the Lynx back to life with the Lynx II which had better hardware and improved battery life, but with the success of the Game Boy and the lack luster game library, the console was doomed to fail as Atari left it behind to focus more on the Atari Jaguar. The Lynx was a very interesting handheld still as it was the first backlit handheld and had the ability to hook up to 15 Lynx’s together!

Swapping Hands

Atari fixed many of the issues they faced, but still needed to merge with JTS Storage as Atari had too bad of a name after all their failures with computers and consoles. JTS Storage was a computer storage company with a better reputation than. Atari, at this point, was essentially just a name and section of the company that held onto Atari properties. JTS sold off Atari Corporation in its entirety to Hasbro leading Atari Corp. to become a subsection of Hasbro Interactive. Hasbro held onto Atari for a measly two years before company Infogrames purchased Hasbro Interactive.

Re-Emergence of a giant?

Infogrames still owns Atari as of the time of this writing, due to Atari accepting a complete buyout from Infogrames, who renamed itself Atari Inc., and named its European section Atari Europe. Eventually, Infogrames (still the name of the parent company) renamed itself Atari SA, and has over the past couple of years, been teasing the new Atari VCS, and recently announced a 2019 debut (read more in the news article I wrote for that here). Maybe we will see Atari finally rise from the ashes as they have tried so many times before, but for now, that remains to be seen.

I hope you enjoyed this trip through the history of Atari! Let me know what history you want me to cover next! Check out Gaming Historia for more content and don’t forget to support us on Patreon or click on our affiliate link for Humble Bundle!

(Editor’s Note: This is a primer for something big coming soon. Be sure to follow us @Gaming_Historia on Twitter, or keep an eye on the site for news of something big. If you listen to our podcasts, you know I’ve been teasing things, but, we will update you soon with more info.)

Liked it? Take a second to support Tyler McKerracher on Patreon!

Tyler McKerracher

Tyler is a young writer, geek, video game enthusiast, and just all out goofy dude all the way from Canada

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: