The Atari Thread

[pacman000]

Found this yesterday: http://jwcody.tripod.com/Goodbye I've been a big Atari fan for years, so I found it interesting.

Some one at AtariAge found a better version: http://www2.hawaii.edu/~gkomatsu/Text/don1

Date: Fri, 4 Oct 1996 21:34:01 -1000
From: "Donald A. Thomas, Jr." <75300.1267@CompuServe.COM>
Subject: Did you say "Goodbye"?

Did you hear anyone say "Goodbye"?
==================================
by Donald A. Thomas, Jr. (10/4/96)

It's odd to imagine an institution, which was as big and as powerful as
Atari once was, to have been shut down in recent days. The real amazement
for me is that it was all accomplished without a measurable flinch from
within or outside the gaming industry. I can understand that gamers wanted
to push Pong out the door early in the timeline. I can appreciate that the
classics such as Missile Command and Asteroids do not push 32-bit and
64-bit systems to any technological limits. I know all these things
intellectually, but the heart cannot face the truth that the world and the
corporate machine known as Atari could not find an amicable way to
coexist.

On Tuesday, July 30, 1996, Atari Corporation took each and every share of
it's company (ATC), wrapped them all in a tight bundle and presented them
to JTS Corporation; a maker and distributor of hard disk drives. On
Wednesday, the shares were traded under the symbol of JTS. Within a few
weeks, the remaining staff of Atari that were not dismissed or did not
resign, moved to JTS' headquarters in San Jose, California. The three
people were assigned to different areas of the building and all that
really remains of the Atari namesake is a Santa Clara warehouse full of
unsold Jaguar and Lynx products.

It was only as long ago as mid '95 that Atari executives and staff
believed things were finally taking a better turn. Wal*Mart had agreed to
place Jaguar game systems in 400 of their Superstores across the country.
Largely based on this promise of new hope and the opportunities that open
when such deals are made, Atari invested heavily in the product and
mechanisms required to serve the Wal*Mart chain. But the philosophical
beliefs of the Atari decision makers that great products never need
advertising or promotions, put the Wal*Mart deal straight into a tailspin.
With money tied up in the product on shelves as well as the costs to
distribute them to get there, not much was left to saturate any
marketplace with advertising. While parents rushed into stores to get
their kids Saturns or PlayStations, the few that picked up the Jaguar were
chastised by disappointed children on Christmas day.

In an effort to salvage the pending Wal*Mart situation, desperate attempts
to run infomercials across the country were activated. The programs were
professionally produced by experts in the infomercial industry and
designed to permit Atari to run slightly different offers in different
markets. In spite of the relatively low cost of running infomercials, the
cost to produce them and support them is very high. The results were
disappointing. Of the few thousand people who actually placed orders, many
of them returned their purchases after the Holidays. The kids wanted what
they saw on TV during the day! They wanted what their friends had! They
wanted what the magazines were raving about!

In early 1996, Wal*Mart began returning all remaining inventory of Jaguar
products. After reversing an "advertising allowance" Atari was obligated
to accept, the net benefit Atari realized was an overflowing warehouse of
inventory in semi-crushed boxes and with firmly affixed price and security
tags. Unable to find a retailer willing to help distribute the numbers
required to stay afloat, Atari virtually discontinued operations and
traded any remaining cash to JTS in exchange for a graceful way to exit
the industry's back door.

Now that JTS has "absorbed" Atari, it really doesn't know what to do with
the bulk of machines Atari hoped to sell. It's difficult to liquidate
them. Even at liquidation prices, consumers expect a minimal level of
support which JTS has no means to offer. The hundreds of calls they
receive from consumers that track them down each week are answered to the
best ability of one person. Inquiries with regard to licensing Atari
classic favorites for other applications such as handheld games are
handled by Mr. John Skruch who was with Atari for over 13 years.

In spite of Nintendo's claim that their newest game system is the first
64-bit game system on the market, Atari Corporation actually introduced
the first 64-bit system just before Christmas in 1993. Since Atari
couldn't afford to launch the system nationwide, the system was introduced
in the New York and San Francisco markets first. Beating the 32-bit
systems to the punch (Saturn/PlayStation), Atari enjoyed moderate success
with the Jaguar system and managed to lure shallow promises from
third-party companies to support the system. Unfortunately, programmers
grossly underestimated the time required to develop 64-bit games. The jump
from 8-bit and 16-bit was wider than anticipated. In addition, Atari was
already spread thin monetarily, but were required to finance almost every
title that was in development.

After the initial launch, it took Atari almost a year before an assortment
of games began to hit store shelves. Even then, having missed the '94
Holiday Season, many of the planned titles were de-accelerated to minimize
problems caused by rushing things too fast. Consumers were not happy and
retailers were equally dismayed. The few ads that Atari was able to place
in magazines were often stating incorrect release dates because that
information changed almost every day although magazines deadline their
issues up to 120 days in advance.

It was in 1983 that Warner Communications handed Jack Tramiel the reins of
Atari. By this time, Atari was often categorized as a household name, but
few households wanted to spend much money on new software and the systems
were lasting forever. No one needed to buy new ones. That, combined with
Warner's obscene spending, amounted to a *daily loss* of over $2 million.
Atari was physically spread all over the Silicon Valley with personnel and
equipment in literally 80 separate buildings; not considering
international offices and manufacturing facilities. Mr. Tramiel took only
the home consumer branch of Atari and forced Warner to deal with the
arcade division separately. Within a few years, Jack took the company
public, introduced an innovative new line of affordable 16-bit computers
and released the 7800 video game system.

To accomplish these miracles for Atari, Jack implemented his "business is
war" policies. While people who publicly quoted his statement often felt
that policy meant being extremely aggressive in the marketplace, the
meaning actually had closer ties to Tramiel's experience as a
concentration camp survivor. Of the 80 buildings in Sunnyvale, Santa Clara
and Milpitas, almost every one of them were amputated from Atari's body of
liabilities. The people, the work, the heritage, the history were fired or
liquidated. Those who survived were unsympathetically required to fill in
the gaps and while most tried, few actually found a way to be successfully
do what a dozen people before them did. Atop the mountain, Jack pressed
with an iron thumb. All Fed/Ex mailings were required to be pre-approved
by one of a handful of people. "Unsigned" purchase orders went unpaid
regardless of the urgencies that inspired their creation. Employees found
themselves spending valuable time trying to find ways around the system to
accomplish their jobs. Many of them lost their jobs for bending the rules
or never finding a way to make things work. As horrible as it all sounds,
it actually was the only way to protect Atari as a company and give it a
chance to survive^E as it did and did very well.

Jack's introduction of the 16-bit computer was initially hearty in the
United States but it went extremely well in Europe. Europeans were not
accustomed to "affordable" technology and although the Atari computers
were not IBM compatible, it didn't matter because people could afford
them. Jacks' private laugh was that the computers were sold at prices much
higher in Europe than Americans were willing to pay. As a result, most of
the machines made were being shipped to European destinations to capture
the higher margin. This enraged the people in the United States that had
been Atari loyalists. While waiting months for stores to take delivery
domestically, international magazines were touting ample supplies. Those
in the know within the U.S. became dismayed. The remainder never knew
Atari was slowly abandoning the value of Atari's name recognition as it
became easier and easier to forget^E some assuming Atari had long filed
for bankruptcy.

On a technical level, Atari 16-bit computers were designed beyond their
time. For less than $1,000, consumers could enjoy "multimedia" before the
phrase was ever really widely used. The icon-based working environment
proceeded Windows popularity although the essential attributes of the two
environments were very similar. MIDI was built-in and became an instant
hit in the high-end music industry. Tasks were activated and manipulated
with a mouse and the system accepted industry standard peripherals such as
printers, modems and diskettes.

With all the genius that went into the technology of the machines, very
little of equivalent genius went into the promoting and marketing the
machines. Mr. Tramiel was the founder of Commodore Business Machines.
When he introduced the PET computer in 1977, Jack discovered he didn't
have to call a single publication. Instead they all flocked to his door
demanding an opportunity to see the product. News magazines. Science
Journals. Business newsletters. Newspaper reporters^E. They were all
there with microphone, camera and pen in hand. And they kept coming back.
Adding a switch, announcing a new 4K application or signing a new retailer
were all big stories the press wanted to handle.

Today, a new video game announcement may generate a request from any of
the dozens of gaming magazines for a press release, but a lot of costly
work has to be done to assure fair or better coverage. Editorial people
are literally swamped with technical news. Samples are mailed regularly to
their attention. Faxes fly in through the phone lines and e-mail jams up
their hard drives. It takes a lot to grab their attention.

While Atari retained hopes to be successful with the Jaguar, Atari's
marketing people were fighting established standards in the industry with
severe handicaps. Since cartridges (the Jaguar was/is primarily a
cartridge-based system) were so expensive, editorial people were required
to return them before new ones would be sent. Editorial people like to
assign review projects. So finding cartridges they sent out was not always
easy to do. Additionally, reviewers often love their work because they get
to keep what they write about. Regardless, the few magazines willing to
cover Atari products were more often turned away because of a lack of
programmable cartridges or any number of other indecisive barriers.
In-store signs and posters were sometimes created, but many retail chains
charge premiums to manufacturers that want to display them. Some direct
mail campaigns were implemented, but Atari often could not afford to keep
those things being advertised on schedule. Therefore, the advertisements
were published and distributed, but the product was not available.

Clearly, Jack's experience with the world beating a path to the door of a
company making a better mousetrap no longer applied. The world had
revolved a few times beneath him and he never noticed. The tactics used to
successfully sell Commodore computers were simply antiquated notions from
the past. Meanwhile, Sony launches the PlayStation with over $500 million
in marketing funds. Today, the PlayStation is considered the most
successful next-generation gaming machine throughout the world. Sony
bought the market. Tramiel's Atari never learned how to do that. Actually,
they never could afford it anyway.

After the 1990's got underway, Europe as well as the rest of the world,
discovered that IBM-compatible computers were becoming more powerful and
more affordable. The world always did want computers at home just like in
the office and companies like Dell and Gateway exemplified the industry's
trend toward home-based office computers. As a result, companies like
Commodore, Atari and Next couldn't compete any longer. While the dedicated
user base of each of them felt abandoned by these companies having to
leave the computer market, the inevitable prevailed. Commodore jumped
ship, Next changed business goals completely and Atari invested what they
had left in the Jaguar game system. Even today, Apple is kicking and
screaming. As good as Apple was at creating a huge niche for themselves,
they focused more heavily on education. When kids grow up and get jobs,
they want business machines. IBM was always the business standard.

When one examines the history of Atari, an appreciation can grow for how
many businesses and people were a part of the game over the years. Chuck
E. Cheese Pizza was started by Atari's founder, Mr. Nolan Bushnell. Apple
Computer was born in a garage by ex-Atari employees. Activision was
founded by Ace Atari programmers. The list goes on and on.

But for some pathetic reason Atari's final days came and went with no
tribute, no fanfare and no dignified farewells. Why? Where did all the
talent go? Where are all the archives? Where are the vaults? Where are the
unpublished games and where are the originals of those that were? Why has
no company stepped forward to adopt the remaining attributes Atari has to
offer? Where are the creditors? What has happened to all the properties
and sites? Where are the databases, warranty cards, promotional items,
notes on meetings, unanswered mail? Who owns P.O. Box 61657? Who goes to
work in Atari's old offices? Where do consumers have their systems fixed?
Who is publishing new games? Who still sells Atari products? Why are there
still a lot of people talking about Atari on-line?

I'm an ex-Atari employee and proud to have been. I'm still an Atari
devotee and proud to be. To me, these are questions which all deserve an
answer, but who will ask them?

The best people to ask these questions are those who have exposure to the
public. If you believe Atari left us without saying goodbye, contact
Dateline at dateline@nbc.com. If you REALLY believe, then send this
article to 10 of your friends in e-mail. AND if YOU REALLY, REALLY
believe, mail a few to newspapers or other news programs. A letter in your
own words would be great!

I'd spend money for a thorough retrospect on Atari. Wouldn't you?

Wouldn't it at least be nice to say "Goodbye"?

--Don Thomas
75300.1267@compuserve.com
209/239-3898

Permission is granted to freely reprint this article in it's entirety
provided the author is duly credited.