Okay I confess my first computer type game I played was Pong, then Space Invaders. Both were played on a Atari 2600 VCS hooked up to the TV. I played it for hours on end while I was off work for pregnancy leave with my first son. A one or two-player game Pong, the console was a tiny black and white box with two mounted paddle controller dials that sat on our coffee table. I loved the way a I could put English, twist or spin put on the ball as it hits the paddles on the ball as it flew back and forth between the paddles.
Atari was a garage shop operation that attracted some of the best and the brightest talent in California's high-tech corridor of commerce, Silicon Valley. They wore blue jeans and sneakers and smoked pot and drank kegs full of beer while creating an industry no one thought was possible. Bob Brown was fascinated with the ballet of white figures dancing across the stage of a CRT screen in the granddaddy of all video games, Spacewar, in 1969. About that time that the cost of integrated circuits began to plummet, he and colleague Nolan Bushnell had the idea to take on the coin-op arcade-game industry and create a game that could be played on a television screen. It was a way to market a $20,000 game system to the individual.
Almost five months to the day of Atari's incorporation: June 27, 1972, Pong was unveiled at the annual trade gathering in Chicago. They built 1,500 and had to sell some by force. At the 1971 Amusement & Music Operators Association show there were a few attempts to copy them. Then, the next year Nolan started Atari and came out with Pong, from there the business simply exploded. Pong, Atari's first consumer product, came about as Bob Brown explains:
I got to talking about Pong with an engineer friend of mine named Harold Lee, who was working in coin-op. I really wanted to do a consumer product so I asked him whether we could put Pong on a chip. It would be a dedicated home game for TV that would essentially be like the coin-op Pong. He said it could be done, and then we sold Atari on the idea."
Approaching Sears Roebuck & Co to market the product, they went into production with the idea of selling 50,000 units, Brown continues:
"We ended up doing double that in the Christmas '75 season. People were waiting two hours in line to sign up on a list just to get a Pong game. Some of the technicians who did our early chip layouts were a little spacey,"
Al Alcorn from Atari, who negotiated the Sears deal explains further:
When the Sears guys came by we'd hide them in the back room. Well, Bob Brown had designed Video Music, our weirdest product ever. Hook it up to your stereo and TV at the same time, and the sound triggered some pretty psychedelic visuals. The Sears guys took one look and asked what we'd been smoking when we did that. Naturally, one of our techs lit up a joint and showed them. Everybody was getting a little uptight, so Nolan and a bunch of us jumped into some empty boxes and took a ride around the building on the conveyer belt.
That night the whole group had dinner. We all went home, cleaned up and changed into suits, hoping to make peace. Meanwhile, they'd gone back to their hotel and changed into jeans and sneakers. What a mix-up! The whole thing was pretty funny, we thought.
In 1976, other companies entered the video game market and started to introduce home systems with full color and interchangeable cartridges, which allowed numerous games to be played on them. These systems made Atari's Pong game systems obsolete, so Nolan Bushnell sold Atari to Warner Communications in 1976 in order to raise money and, in 1978, Atari released the Video Computer System (VCS) which later came to be known as the Atari 2600. With their Video Computer System and games, Atari rose from a $500 lark to a $2 billion business in 10 short years.
Source:
The incredible, incredible story of Atari —
from a $500 lark to a $2 billion business in 10 short years:
http://www.atari-history.com/cut2pin.html