Why did Mattel Bow Out?

[atari5200dude82]

Since some you you dudes are taLKing about the C-64 games. I listed some disk games as well as Atari games from 3 consoles. Some are new. Check it out under Atari/c-64 games in the market place.

[intvnut]

I guess you had to be there at the time, but NO ONE really survived except Atari. And they did it because of their huge market presence, massive cost-cutting, enormous library, brand recognition... Mattel didn't even come close on any front.

 

You mention how short console generations used to be compared to today - that's sorta true, although the 2600 survived damn near for ever.

 

Well, interestingly enough, the Atari 7800 was supposed to come out way earlier than it did to replace the 5200 and reconnect to the 2600 line. Atari was as guilty as anyone at trying to churn the console generations. I posit the only reason the Atari 2600 held on as long as it did was that it had such a huge installed base that it practically cashed in on the first wave of nostalgia. It was dumb luck pragmatism, as opposed to a conscious effort to slow the pace to something sustainable. I'd say its long run also pointed the way to the modern era's much longer console iteration time.

 

Atari also survived (barely) by having a sufficiently deep-pocketed corporate parent (Warner, for a time), a successful place in arcade gaming (where they had started), and a moderately good run at marketing an Amiga-wannabe (the Atari ST line). The Jaguar and Lynx did not keep the company afloat, and even the ST is... meh.

 

In the end, I don't even really count Atari as surviving, but rather as having one of the longest deaths. Sure, Hasbro or Infogrames or someone owns the Atari name these days (I've lost track), but whoever does bears little relation to Nolan Bushnell's empire of the 70s and 80s.

 

As for being there at the time... I wasn't exactly born yesterday.

[catsfolly]

I think Mattel "bowed" out of video games for two reasons.

 

1. They were too slow for the consumer electronics business. I think in the toy business they took years to develop a product line (like Barbie or Hot Wheels), and then made variations of those products for years while they worked on the next great product line. The Intellivision rapidly went from being "too expensive" for the marketplace to "too underpowered" to compete with Atari and Coleco. The Intellivision 4 in the labs was ahead of what other people were doing (Genesis-class with some Amiga like tricks thrown in) but it didn't come together fast enough to save Mattel Electronics.

 

2. Mattel didn't invent the "licensing model". Both Mattel and Atari operated on the premise that "We will make all the games you will ever need." They tried to stop others from making games by keeping the technical details of their hardware as trade secrets and making employees sign Non-disclosure agreements that forbid them from using their knowledge of the system outside of the company. People reverse engineered the systems and made games anyway - and the market was flooded with mediocre games.

 

Nintendo with their licensing model allowed others to create games as long as they bought the cartridges from Nintendo. This way the player had a wide variety of games, Nintendo made money on every game sold, and Nintendo could control the market as far as what games got made, and enforced user interface standards that made for a better experience for the players.

 

The Atari 2600 was such a primitive system that the processor had to do a lot of the work necessary to generate the video image. This seemed like a liability at first, but because the video generation was done by software, programmers could invent more and more software tricks to push the system farther and farther. That is how the system survived for so long.

 

I think Atari did fail. Time Warner practically gave the computer division of Atari to Jack Tramiel just to avoid the embarrassment of shutting it down completely. I think Jack Tramiel never really wanted to be in the video game business (Clive Sinclair didn't either) - he just wanted to make computers. But he kept the company alive by selling the old video game inventory, and finally worked out the legal details so he could release the 7800 - years later than originally planned. The Atari XGS system is what the 5200 should have been (IMHO) - I always thought that making a system slightly different than the Atari computers that required completely different cartridges was a big mistake.

 

 

Catsfolly

[pimpmaul69]

The Atari XGS system is what the 5200 should have been (IMHO) - I always thought that making a system slightly different than the Atari computers that required completely different cartridges was a big mistake.

 

 

Catsfolly

i totally agree with you. Complete backwards compatibility. Then even people who had invested in the 400 and 800 could be more likely to invest in the system. And if the 2600 had used the same carts as well that would have been a bonus. They could have carts say "for vcs or 400" or "for 400 only". Also i think they should have just marketed the xegs as the new console instead of the 7800. But they also should have added a 2 button controller for the xegs as well. The did add the light gun to the system at least. Edited January 3, 2015 by pimpmaul69

[Pset]

Mattel didn't really have luck/skill in the computer hardware or software market

 

I found this in a story about Kevin O'leary

 

 

 

In 1995, Softkey acquired The Learning Company (TLC) for $606 million, moved its headquarters to Boston, and took The Learning Company as its name. TLC bought its former rival Brøderbund in June 1998 for $416 million. In 1999, TLC and its 467 software titles were acquired by Mattel in a $3.8 billion stock swap.^[9] Sales and earnings for Mattel soon dropped, and O'Leary departed from Mattel. The purchase by Mattel was later called one of the most disastrous acquisitions in history.

Edited January 20, 2015 by Pset

[intvnut]

Mattel didn't really have luck/skill in the computer hardware or software market

 

I found this in a story about Kevin O'leary

 

 

The Mattel Touch. It's like the opposite of the Midas touch. Everything they touch in the computer / video game space turns to lead instead of gold.

 

See also: Nintendo Power Glove (by Mattel), HyperScan...

[Retro Rogue]

It's simple. Mattel bowed out because they were taking big losses from late '82 onwards from losses generated by its Mattel Electronics division. Its stock value actually plummeted and was cut in half by spring of '83 with no signs of improving. People were even questioning if Mattel was going to go bankrupt:

 

http://news.google.com/newspapers?nid=1144&dat=19830529&id=6xshAAAAIBAJ&sjid=F2EEAAAAIBAJ&pg=2868,6047399

 

By the fall they were making plans to divest themselves of groups like Mattel Electronics to focus on it's more toys (dolls like then launching Rainbow Brite brand).

 

Really it's no different than why Steve Ross had to look to jettison Atari Inc. the following year.