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Daily Archives: April 1, 2016

Generation Nintendo

Nintendo

In the final months of World War II, when the United States was trying to burn out the will of a starving Japan via the most sustained campaign of aerial incendiary bombardment in history, a handful of obvious targets remained strangely untouched. Among those targets was Kyoto: population 1 million plus, founded in the year 793, capital of the nation and home of the Emperor for most of the intervening centuries, home to more national shrines and other historic sites than any other city in Japan, world famous for its silk and cloisonné. If a single city can be said to embody the very soul of the Japanese people, it must be this one.

If the citizens of Kyoto believed that their city was being left untouched by the bombs raining down on the rest of the country out of respect for the special place it occupied in the Japanese psyche, they were partially correct. Yet the motivation behind their seeming good fortune was cold-blooded rather than humanitarian. American Air Force planners were indeed aware of Kyoto’s symbolic importance, but they hardly saw that importance as grounds for sparing the city. Far from it. Kyoto was being reserved as a target for a special new weapon, one which was referred to only obliquely in Air Force internal memoranda as “the gadget.” Today we know the gadget as the atomic bomb. Entirely destroying Kyoto with one bomb would deliver a shock to the rest of Japan unequaled by the destruction of any other possible target: “From the psychological point of view there is the advantage that Kyoto is an intellectual center for Japan and the people there are more apt to appreciate the significance of such a weapon as the gadget.” Kyoto must be left untouched while the gadget was made ready for service so that mission planners and scientists could properly evaluate the bomb’s effect on an undamaged clean slate of a target.

Hundreds of thousands of Kyoto residents would wind up owing their lives to Henry L. Stimson, a humane man tortured daily by the orders he had to issue as the American Secretary of War; never was there a Secretary of War who hated war more. In response to Stimson’s demand after the successful first test of the gadget in New Mexico, General Leslie Groves, head of the Manhattan Project, reluctantly presented the Air Force’s list of planned targets to him, with Kyoto at the top. Stimson was horrified. Citing the proposed destruction of Kyoto as an unforgivable act from which Japan would never recover, Stimson, 77 years old and in poor health, faced down virtually the entire entrenched bureaucracy of the American military to demand that the first atomic bomb to be used in anger be dropped somewhere, anywhere else: “This is one time I’m going to be the final deciding authority. Nobody’s going to tell me what to do on this.” His stubborn stance resulted at last in Kyoto being stricken from the list by grumbling generals who would have been perfectly happy if its destruction really had been a death blow to the culture it symbolized, thank you very much. Of course, in saving hundreds of thousands of Kyoto residents Stimson was also consigning to death hundreds of thousands of others in Hiroshima. Such are the wages of war.

The decision to spare Kyoto had another unintended consequence, one which may seem trivial — even disrespectful — to mention in parallel with such immense tolls in human lives saved and lost, but one which in its own way illustrates the interconnectness of all things. Hidden away within Kyoto’s blissfully undamaged warren of ancient streets was a little family-owned company called Nintendo, maker of ornate playing cards and other games and collectibles. Absolutely dedicated to the war effort, as all good Japanese were expected to be at the time, they had lately taken to giving their products jingoist themes, such as a backgammon board illustrated by cartoon animals dressed up as soldiers, with Japanese flags flying proudly above them and British and American flags lying crumpled in the dust at their feet.

More than four decades later, Stimson’s determination to spare Kyoto and with it Nintendo boomeranged back on his country in a way that no one could have seen coming. Many contemporary commentators, conditioned by the Reagan Revolution to cast all things in terms of nationalism and patriotism, saw in the arrival of Nintendo on American shores the opening of the latest front in a new war, economic rather than military this time, between the United States and Japan. And this time it seemed that Japan was winning the war handily. They had come for our steel, and we had done nothing. They had come for our auto industry, and we had done nothing. They had come for our televisions and stereos, and we had done nothing. Now they were coming for our videogame consoles. How long would it be until the PC industry, arguably the biggest economic success story of the 1980s, was threatened as well?

Given the subject of this article, I should take a moment to clarify right now that this blog has not been and will never become a history of console-based videogames. This blog is rather a history of computer games, a culture possessed of plenty of interconnections and collisions with the larger, more mainstream culture of the consoles, but one which has nevertheless remained largely its own thing ever since the first popular videogame console and the first three pre-assembled PCs were all launched during the single fecund year of 1977. In addition to reasons of pure personal preference, I justify this focus by noting that a fair number of people are doing great, rigorous history in the realm of videogames, while the realm of computer games has been comparatively neglected.

Still, we can’t really understand the history of computer games without reckoning with those aforementioned interconnections and collisions with the world of the consoles. And one of the biggest and most obvious collisions of all was that crazy time at the tail end of the 1980s when Nintendo arrived to sweep the rug out from under a computer-game industry which had spent the last few years convinced that it was destined to become the next great movement in mainstream American entertainment — i.e., destined to hold exactly the position that this Japanese upstart had just swept in and taken over with breathtaking speed. Small wonder that coded allusions to the dark days of World War II, accompanied by thinly veiled (or blatantly unveiled) racism, became the order of the day in many sectors of American culture, industry, and government alike. Meanwhile the bewildered computer-game executives were trying to figure out what the hell had just hit them and what they should do about it. Let’s join them now in asking the first of those questions.

Hiroshi Yamauchi

Hiroshi Yamauchi

The history of the company known as Nintendo — the name can be very roughly translated as an admonition to work hard but also to accept that one’s ultimate success is in the hands of greater powers — dates all the way back to 1889, when it was founded by Fusajiro Yamauchi as a maker of intricately painted playing cards, known as “hanafuda” in Japanese. Nintendo managed to survive and grow modestly amid many changes in Japanese life over the course of the next half-century and beyond. The company’s modern history, however, begins in 1949, when Hiroshi Yamauchi, latest scion of the family-owned business, took over as president. Far more ambitious than his forebears, this latest Yamauchi was inspired by the entrepreneurial ferment of the rebuilding postwar Japan to expand Nintendo beyond playing cards and collectibles. The results of his efforts were decidedly mixed in the early years. Among his less successful initiatives were a line of instant-rice meals — a sort of ricey Ramen Noodles before Ramen Noodles were cool — and a chain of “love motels” offering busy executives the convenience of paying for their trysts by the hour. (Ironic as they might seem in light of Nintendo’s later rigorously enforced family-friendly image, at the time the love motels seemed to everyone around him a natural innovation for Yamauchi to have dreamed up; he was a notorious philanderer.) More successful, for a while, was a Nintendo taxi service. Yet even it was hardly a world-beater. Throughout the first two decades of Yamauchi’s lengthy reign he continued to cast restlessly about for the Big One, the idea that would finally take Nintendo to the next level.

In 1969, he made a big step in the direction of finding his company’s life’s purpose when he founded a new division called simply “Toys.” Employing a number of young gadget freaks as inventors, Toys began to churn out a series of strange contraptions straight out of Rube Goldberg, such as the Ultra Hand, a scissor-like reach extender that was more whimsical than practical; the Ultra Machine, an indoor mechanical baseball pitcher; and the Ultra Scope, a periscope for peeking around corners and over fences. (Parents were not terribly fond of this last one in particular.) All were quite successful, opening at last the sustainable new business front for Nintendo that Yamauchi had been dreaming of for so long.

With electronic components getting smaller and cheaper by the year, Nintendo’s innovative toys inevitably began to take on more and more of an electronic character as time wore on. The first big success in the realm of electronic gadgets was something called the Nintendo Beam Gun, which combined a light gun with a set of targets equipped with the appropriate photoelectric sensors; more than 1 million of them were sold. Nintendo built on the Beam Gun’s success with a chain of Laser Clay Ranges — think “clay pigeons” — that spread across Japan during the mid-1970s, re-purposed bowling alleys where patrons could engage in gunfights with cowboys and “homicidal maniacs” projected onto the far wall.

With Atari now going strong in the United States, videogames were a natural next step for Nintendo. They first made a series of Color TV Games, each a home videogame capable of playing a few variants of a single simple game when hooked up to the family television set; they sold at least 2.5 million of them in the late 1970s. The Nintendo Game & Watch, a whole line of handheld gadgets capable of playing a single game each, did even better; Nintendo is estimated to have sold over 40 million of them during the 1980s. Meanwhile they were also moving into the standup arcade; Donkey Kong, released in 1981, became a worldwide smash, introducing the Nintendo name to many in the United States for the first time. The designer of that cute, colorful, relatively non-violent game, a virtual blueprint for the eventual Nintendo aesthetic as a whole, was one Shigeru Miyamoto. He would become not only Nintendo’s own most famous designer and public figure, but the most famous Japanese videogame designer of all time, full stop. The protagonist of Miyamoto’s Donkey Kong, a little leaping Italian plumber named Mario, was also destined for greatness as one of if not the most famous videogame characters of all time (his only serious rival is likely Pac-Man, another contemporaneous Japanese creation).

All of this success, however, was only laying the groundwork for Nintendo’s masterstroke. Moving on from the single-game units that had so far been Nintendo’s sole output, Yamauchi tasked his engineers with creating a proper videogame console capable of playing many games that could be sold separately in the form of cartridges, just like the Atari VCS. The device they came up with was hardly state of the art even at the time of its debut. It was built around a clone of the venerable old 8-bit MOS 6502, the same chip found in the Atari VCS as well as American home computers like the Apple II and Commodore 64, with those circuits that were protected by patents excised. It offered graphics a little better than the likes of the 64, sound a little worse. The new machine was being readied at seemingly the worst possible time: just as the Great Videogame Crash was underway in the United States, and just as the worldwide conventional wisdom was saying that home computers were the future, videogame consoles a brief-lived fad of the past. Yet Nintendo freely, even gleefully defied the conventional wisdom. The Nintendo Family Computer (“Famicom”) was deliberately designed to be as non-computer-like as possible. Instead it was patterned after Nintendo’s successful toys and gadgets — all bright, garish plastic, with as few switches and plugs as possible, certainly with nothing as complicated as a keyboard or disk drive. It looked like a toy because Nintendo designed it to look like a toy.

The Nintendo Famicom

The Nintendo Famicom

Yamauchi realized that a successful videogame console was at least as much a question of perception — i.e., of marketing — as it was of technology. In the imploding Atari, he had the one great counterexample he needed, a perfect model of what not to do. Atari’s biggest sin in Yamauchi’s eyes had been to fail to properly lock down the VCS. It had never occurred to them that third parties could start making games for “their” machine, until Activision started doing just that in 1980, to be followed by hundreds more. Not only had all of those third-party cartridges cost Atari hundreds of millions in the games of their own that they didn’t sell and the potential licensing fees that they didn’t collect, they had also gravely damaged the image of their platform: many or most Atari VCS games were just plain bad, and some were in devastatingly terrible taste to boot. The public at large, Yamauchi realized, didn’t parse fine distinctions between a game console and the games it played. He was determined not to lose control of his brand as Atari had done theirs.

For better and for worse, that determination led to Nintendo becoming the first of the great walled gardens in consumer software. The “better” from the standpoint of consumers was a measure of quality control, an assurance that any game they bought for their console would be a pretty good, polished, playable game. And from the standpoint of Yamauchi the “better” was of course that Nintendo got a cut of every single one of those games’ earnings, enough to let him think of the console itself as little more than a loss leader for the real business of making and licensing cartridges: “Forgo the big profits on the hardware because it is really just a tool to sell software. That is where we shall make our money.” The “worse” was far less diversity in theme, content, and mechanics, and a complete void of games willing to actually say almost anything at all about the world, lest they say something that some potential customer somewhere might possibly construe as offensive. The result would be an infantilization of the nascent medium in the eyes of mainstream consumers, an infantilization from which it has arguably never entirely escaped.

Whatever the reservations of curmudgeons like me, however, the walled-garden model of software distribution proved successful even beyond Yamauchi’s wildest dreams. After releasing their new console to Japanese consumers on July 15, 1983, Nintendo sold more than 2.5 million of them in the first eighteen months alone. Sales only increased as the years went by, even as the hardware continued to grow more and more technically obsolete. Consumers didn’t care about that. They cared about all those cute, colorful, addictive games, some produced by an ever-widening circle of outside licensees, others — including many or most of the best and best-remembered — by Nintendo’s own crack in-house development team, with that indefatigable fount of creativity named Shigeru Miyamoto leading the way. Just as Yamauchi had predicted, the real money in the Famicom was in the software that was sold for it.

Minoru Arakawa

Minoru Arakawa

With the Famicom a huge success in Japan, there now beckoned that ultimate market for any ambitious up-and-comer: the United States. Yamauchi had already set up a subsidiary there called Nintendo of America back in 1980, under the stewardship of his son-in-law Minoru Arakawa. Concerns about nepotism aside — no matter how big it got, Nintendo would always remain the Yamauchi family business — Arakawa was ideal for the job: an MIT-educated fluent English-speaker who had traveled extensively around the country and grown to understand and love its people and their way of life. Under his stewardship, Nintendo of America did very well in the early years on the back of Donkey Kong and other standup-arcade games.

Yet Nintendo as a whole hesitated for quite some time at the prospect of introducing the Famicom to North America. When Arakawa canvased toy stores, the hostility he encountered to the very idea of another videogame console was palpable. Atari had damaged or destroyed many a business and many a life on the way down, and few drew much of a distinction between Atari and the videogame market as a whole. According to one executive, “it would be easier to sell Popsicles in the Arctic” than to convince the toy stores to take a flyer on another console.

But Arakawa, working in tandem with two American executive recruits who would become known as “the two Howards” — Howard Lincoln and Howard Philips — wouldn’t let go of the idea. Responding to focus-group surveys that said the Japanese Famicom was too toy-like and too, well, foreign-looking to succeed in the United States, he got Nintendo’s engineers to redesign the externals to be less bulbous, less garish, and less shiny. He also gave the Famicom a new, less cutsy name: the Nintendo Entertainment System, or NES. The only significant technical update Nintendo made for North America was a new state-of-the-art handshaking system for making sure that every cartridge was a legitimate, licensed Nintendo game; black-market cartridges duplicated by tiny companies who hoped to fly under the radar of Nintendo’s stringent licensing regime had become a real problem on the Famicom. Tellingly, the lockout system was by far the most technically advanced aspect of the NES.

The Nintendo Entertainment System

The Nintendo Entertainment System

The new NES made its public debut at last at the Summer Consumer Electronics Show in June of 1985. Few in the home-computer trade press — the videogame trade press didn’t really exist anymore — paid it any real attention. The big news of the show was rather the new Jack Tramiel-led Atari’s 16-bit ST computer. Computer Gaming World was typical, mentioning the NES only as a passing bit of trivia at the end of a long CES feature article: “Nintendo even offered an entirely new game system.” Clearly Arakawa and company had an uphill climb before them.

They deliberately started small. They would sell the NES first in New York City only — chosen because Arakawa considered it the most cynical and challenging place to market a new gadget in the country, and, as the old song says, “if you can make it there you can make it anywhere.” Starting with a warehouse full of the first 100,000 NESs to arrive from Japan and a $50 million war chest, Arakawa and the two Howards personally visited virtually every toy and electronics store in the five boroughs to press flesh and demonstrate the NES to skeptical managers and proprietors — and (hopefully) to take orders when they were finished. Meanwhile Nintendo blitzed the airwaves with advertising. They managed to sell 50,000 NESs in New York alone that Christmas season — not bad for an unknown gadget in a field that everyone, from the most rarefied pundit to the most ordinary Joe or Jane on the street, considered to be yesterday’s fad.

From that promising start they steadily expanded: first to that other taste-maker capital Los Angeles, then to Chicago, to San Francisco, to Dallas and Houston, and finally nationwide. Sales hit the magic 1 million mark well before the end of 1986. Cheap and cheerful and effortless in its lack of fiddly disk drives and keyboards, the NES was selling by that point as well as the Commodore 64, and far better than any other home computer. In the NES’s second year on the market it eclipsed them all to such an extent as to make continued comparison almost pointless: 3 million NESs were sold during those twelve months alone. And, astonishingly, it was still just getting started. During 1988, 7 million NESs were sold, to go with 33 million cartridges, each of which represented yet more profit for Nintendo. Lifetime NES sales topped 30 million in 1990, by which time one out of every three American homes could boast one of these unassuming gray boxes perched underneath the television. Total NES and Famicom lifetime sales reached a staggering 75 million in 1992; as many Nintendos were by then in the world as all PCs, whether found in homes or businesses or schools, combined. Even the Atari VCS in the heyday of the first videogame fad had never been able to boast of numbers like this.

Because Nintendo had come into the console market when it was universally considered dead, they had been able to reinvent it entirely in their own image. Just as “Atari” had once been a synonym for videogames in general, now “Nintendo” threatened to become the same for a new generation of players. Savvy about branding and marketing in a way that Atari had never quite managed to be, Nintendo felt compelled to actively push against this trend by aggressively protecting and limiting the use of their trademarks; they didn’t want people buying a new “Nintendo” that happened to have the name of Sega, Sony, or 3DO stamped on its case.

Nintendo’s penetration of the North American market could (and doubtless has) serve as the basis of an MBA course in marketing and brand-building. Starting from the less than nothing of a dead industry replete with consumer ill-will, coming from a foreign nation that was viewed with fear and mistrust by many Americans, Nintendo of America built one of the largest and most insanely loyal customer bases the American economy has ever known. They did it by tying their own brand to brands their target demographic was known to already love, like Pepsi and McDonald’s. They did it by building Nintendo stores within stores in major chains from Macy’s to Toys “R” Us, where kids could browse and play under the benevolent gaze of Mario while their parents shopped. (By 1991, Nintendo alone represented 20 percent of Toys “R” Us’s total revenues, and seven of their ten best-selling single products.) They did it by building a massive mailing list from the warranty cards that their young customers sent in, then using contests and giveaways to make every single one of them feel like a valued member of the new Generation Nintendo. They did it by publishing a glossy magazine, Nintendo Power, full of hints and tips on the latest games and all the latest news on what was coming next from Nintendo (and nothing on what was coming from their competitors). They did it by setting up a hotline of “Nintendo Game Counselors,” hundreds of them working at any one time to answer youngsters’ questions about how to get through this tricky level or kill that monster. They did it by relentlessly data-mining to find out what their customers liked about their games and what they didn’t, and crafting new releases to hit as many players as possible precisely in their sweet spots. They did it by spending up to $5 million on a single 30-second television commercial, four or five times the typical going rate, making the new commercials for a new Nintendo game an event in themselves. They did it by making sure that Mario and Zelda and their other iconic characters were everywhere, from televisions shows to records, from lunch boxes to bed sheets. And they did it by never worrying their customers with the sorts of metrics that the home-computer makers loved: kilobytes and megabytes and colors and resolutions and clock speeds and bit counts. The NES was so thoroughly locked down that it was years before there was any published information available at all on what was really contained within those ubiquitous gray plastic shells.

If it can all sound a little soulless when laid out like that, well, few in business would argue with the end results. Nintendo seemed to be becoming more American than most Americana. “A boy between 8 and 15 without a Nintendo is like a boy without a baseball glove,” wrote Hobby World magazine in 1988. In 1990 a survey found Mario to be more recognizable to American children than that most American of all cartoon icons — Mickey Mouse.

And where did all of this leave the established American computer-game industry? That was a question that plenty in said industry itself were asking with ever-increasing frustration and even desperation. Total sales of computer games published on all platforms in 1989 totaled about $230 million; total sales for Nintendo cartridges, $1.5 billion. It wasn’t supposed to have gone like this. No one in computer games had seen anything like Nintendo coming. They, the computer-game industry, were supposed to have been the next big wave in American home entertainment — a chicken in every pot and a home computer in every living room. Instead this Japanese upstart had stolen their thunder to such an extent as to render their entire industry an afterthought, a veritable non-entity in the eyes of most financial analysts and venture capitalists. Just to add insult to the injury, they were being smothered by thoroughly obsolete 8-bit technology when they could offer consumers audiovisual feasts played on Amigas and Atari STs and IBM PS/2s with VGA graphics. A computer-game designer with Electronic Arts saw unnerving parallels between his own industry and another American industry that had been devastated by Japan in the previous decade:

The best companies and the best programmers were making computer games. But the Nintendo player didn’t care about the sophisticated leaps we were making on computers — the frame rate of the images or incredible sound. They just wanted fun. It was like we were making gas guzzlers and the Japanese were making subcompacts.

At street level the situation didn’t look much better. Fred D’Ignazio, a columnist for Compute!’s Gazette, shares a typical story:

My kids and I used to play games on our home computer — games like Epyx’s The Legend of Blacksilver, SSI’s Questron II, EA’s Jordan vs. Bird: One-on-One, Gamestar’s Take Down, Arcadia’s Aaargh!, and, of course gobs and gobs of good educational games.

Then the Nintendo landed, and things haven’t been the same since. The Nintendo runs day and night. (We’re not even allowed to shut off the machine when we go to bed because there’s always a game in progress — and there’s no disk drive to back it up.) Meanwhile, I don’t think our little home computer has been fired up in weeks.

The computer that was most damaged by Nintendo’s invasion of North America was undoubtedly the Commodore 64. It was very cheap in computer terms, but once you added in the cost of the essential disk drive it was nowhere near as cheap as the NES. And it was still a computer, even if a computer that had long been used primarily for playing games. You had to type in arcane commands to get a game started, had to wait for the game to load, often had to shuffle disks in and out of the drive and do a lot more waiting as you actually played. A Compute!’s Gazette reader shares the story of her attempt to introduce her Nintendo-loving eight-year-old nephew to the joys of Commodore 64 gaming:

As he looked through my 64 software to pick out a game, I started to give directions on how to handle the software and disk drive. Before I could finish he said, “I just want to use a cartridge and start playing.” After about fifteen minutes into a game he said, “This is great, but how come it takes so long to start the game again and why do I have to keep turning the disk over and over all the time?” Shortly after, he started complaining that his hand was too small for the joystick. He tried three other joysticks, but he either had the same problem or the joystick didn’t have the dexterity needed to play the game. He then said, “I wish I could use my Nintendo controls on your Commodore.” Soon after, he quit and went right to his Nintendo.

The Commodore 64 was in a very difficult position, squeezed from below by Nintendo and squeezed from above by the Amiga and Atari ST and, most of all, by ever more consumer-friendly MS-DOS-based machines from companies like Tandy, which were beginning to sport hard disks, crisp VGA graphics, sound cards, and mice. There wasn’t much that Commodore’s aged little breadbox could offer in response to a feature set like that. In the battle versus Nintendo for the low end, meanwhile, all of the immense force of playground public opinion was arrayed against the Commodore 64. The 64 was clunky and slow and ugly. It was the machine your big brother used to play games on, the one your parents kept pushing you toward to learn programming or to play educational (blech!) games. The Nintendo was the machine that all your friends played on — the same friends who would look on you as a freak if you tried to get them to play a computer game with you.

If you think that hardcore Commodore 64 users accepted this changing world order peacefully, you don’t have much experience with the fanatic platform loyalties of the 1980s. Their heated opinions on the 64’s Nintendo crisis spilled much ink on the pages of the remaining 64-centric magazines, moving through spasms of denial (“If Nintendo has the ability to keep its users captured, why do my two nephews keep pestering me to let them play the games that I have for my 64?”), advice (“Commodore could bring out some new peripherals like a light gun to play shooting games or a keyboard to make use of the superior sound of the 64”), and justification (“This letter was typed on a 64. Let’s see any Nintendo do that!”). When all else failed, there was always good-old-fashioned name-calling: “The word-processing capability of the 64 is a pointless feature to most Ninnies, since the majority of them don’t seem to be able to read and write anyway. Most of the Ninny chic was built on the fact that a baboon could operate it.”

None of this raging against the dying of the light could make any difference. The Commodore 64 went into an undeniable decline in 1988. That decline became a free fall in 1989, and in 1990 the 64 was effectively declared dead by the American software industry, with virtually every publisher terminating support. The other great 8-bit survivor, the Apple II, hung on a little longer thanks to an entrenched user base in schools and small businesses, but when Apple finally discontinued all production of the line in 1993 the news was greeted by most publishers with a shrug: “I didn’t know those old things were still being made!”

The computer-game publishers’ reactions to Nintendo were complicated, ofttimes uncertain, occasionally downright contradictory. With Nintendo rapidly taking over what used to be the low end of the computer-game market, many publishers felt emboldened to refocus their energies on the still slowly growing higher end, particularly on all those new consumer-oriented clones from Tandy and others. Plenty of publishers, it must be said, weren’t really all that sad to see the 64 go. The platform had always been tricky to develop for, and its parent company was still widely loathed for heaps of very good reasons; everyone in the industry seemed to have at least one Commodore horror story to tell. Many had come to see the 64 during its years of dominance as an albatross holding back ambitions that would have been realizable on the bigger, more powerful platforms. Now they were at last free to pursue those grander schemes.

At the same time, though, the Commodore 64 had been their cash cow for years, and there remained the question of whether and how soon all those bigger machines would make up for its loss. Certainly they failed resoundingly to take up the slack in 1989, a bad year for the computer-game industry and a great one for Nintendo.

As unhappy as the majority of industry old-timers remained with the Nintendo-dominated state of affairs in digital games in general, that $1.5 billion in annual cartridge revenue and massive mainstream penetration was awfully tempting. As early as 1988, it seemed that just about everyone was discussing adapting their computer games to the NES, and a fair number were swallowing their pride to approach Nintendo with hat in hand, asking for a coveted license to make NES games. In addition to the sheer size of the Nintendo market, it also had the advantage that piracy, which many in the computer-game industry continued to believe was costing them at least half of the revenues they would otherwise be enjoying, was nonexistent there thanks to those uncopyable cartridges and the NES’s elaborate lockout system.

Activision,1 who had enjoyed their greatest success by far in the old glory days of the Atari VCS, jumped onto the Nintendo bandwagon with perhaps the most enthusiasm of all. Activision’s head, the supremely unsentimental Bruce Davis, often sounded as if he would be perfectly happy to abandon computers altogether, to make Activision exclusively a publisher of videogame cartridges again: “If hardware companies are designing a machine for one purpose, they will do a better job than on a multi-function machine.”

But it’s the more unlikely NES converts that provide the best evidence of just how far Nintendo had come and just how much pressure the traditional computer-game industry was feeling. The NES began to get quite a number of ports of computer-game fare that no one would ever have imagined trying to put on a machine like this just a year or two earlier. Origin, for instance, put out NES versions of Ultima III and Ultima IV, and Lucasfilm Games ported Maniac Mansion. (See Douglas Crockford’s “The Expurgation of Maniac Mansion for a description of the hoops publishers like Lucasfilm had to jump through to meet Nintendo’s stringent content restrictions.) Even SSI, whose traditional stock-in-trade of turn-based, cerebral, complicated strategy games was about as far from the whimsy of Mario and Zelda as you could get, moved Pool of Radiance over to the NES. Computer Gaming World, the journal of choice for those same cerebral strategy gamers, tried to rope in Mario fans with a new magazine-within-a-magazine they dubbed “Video Gaming World.”

Few of these initiatives bore all that much fruit. The publishers may have found a way to get their games onto the NES, but said games remained far from the sort of fare most Nintendo players were interested in; suffice to say that Nintendo never had to worry about any of these titles eclipsing Mario. Still, the fact that so many computer-game publishers were making such an effort shows how scary and uncertain Nintendo was making their world. Perhaps the most telling moment of all came when Trip Hawkins announced that Electronic Arts would be jumping into the console space as well. This was the same Trip Hawkins who had written a commitment to “stay with floppy-disk-based computers only” into Electronic Arts’s first business plan, who had preached the gospel of home computers as successors to videogame consoles as loudly and proudly as anyone in his industry. Now he and his company were singing a very different tune. Bing Gordon, Hawkin’s right-hand man at Electronic Arts, compared home computers to, of all unflattering things, steam engines. James Watt, the inventor of the steam engine, had imagined one in every home, with a bunch of assorted pulleys and gears to make it do different things. Instead modern homes had a bunch of more specialized machines: washing machines, food processors… and now Nintendos. Soon Hawkins would leave Electronic Arts to found 3DO, a company to make… you guessed it, a new videogame console.

Some, however, chose a more belligerent path than these can’t-beat’em joiners. Nintendo’s rigorous control of the NES’s walled garden rankled everyone in the older software industry; this just wasn’t how their business was done. They believed that Nintendo was guilty of restraint of trade, antitrust violations, you name it. Particularly enraging was Nintendo’s complete control of the manufacturing pipeline for NES cartridges. Leveraging those data-mining systems of theirs, more sophisticated than anyone had heretofore ever dreamed of, Nintendo made sure that the supply of new games was always slightly less than the demand for them, thereby creating a hype for each new title as a hot, desirable status symbol among the Nintendo Generation and, most of all, avoiding the glut of games piled up in warehouses — and, eventually, landfills — that had marked the Great Videogame Crash of 1983. But when American publishers saw their games produced in insufficient quantities to become the hits they believed they might otherwise have been, they cried foul. The Software Publishers Association served as the disgruntled voice of the American software industry as a whole in what became a full-scale public-relations war against Nintendo.

The SPA believes that Nintendo has, through its complete control and single-sourcing of cartridge manufacturing, engineered a shortage of Nintendo-compatible cartridges. Retailers, consumers, and independent software vendors have become frustrated by the unavailability of many titles during the holiday season, and believe that these shortages could be prevented by permitting software vendors to produce their own cartridges.

American publishers felt certain that Nintendo was playing favorites, favoring their own games and those of their favorite third-party publishers — generally the ones from Japan — by manipulating production numbers and manipulating the sentiments of Generation Nintendo through the coverage they gave (or didn’t give) each game in Nintendo Power. “If I pissed Nintendo off,” runs a typical complaint, “I would get less product. My games would get hit in Nintendo Power and they’d get low ratings.” And the most surefire way to piss Nintendo off, at least according to this complainer, was to release a game for the NES’s first serious competitor, the Sega Genesis console that entered the United States in 1989.

There was plenty of tinder already lying about the public sphere, just waiting to be ignited by such rhetoric. All of the concerns about videogames that had been voiced by parents, educators, and politicians during the heyday of Generation Atari were now being dusted off and applied to Generation Nintendo. Now, however, they were given additional force by Nintendo’s very foreignness. Plenty of Americans, many of whom had still not completely forgiven Japan for Pearl Harbor, saw a nefarious agenda behind it all, a fifth column of Mario-obsessed youngsters who might come to undermine the very nation. “Notice the way Super Mario is drawn,” wrote one in a letter to a magazine. “He has the eyes of someone who has been brainwashed.” Lurking just below the surface of such complaints, unstated but by no means unconveyed, were old attitudes toward the Japanese as shifty characters who could never be trusted to follow the rules, whether in war or business. It all came down to “cultural” differences, they muttered disingenuously: “There’s more of a sharing of the pie by American companies. In Japan, it’s different: winners win big and losers lose.”

Hoping to capitalize on the burgeoning anti-Nintendo sentiment, in December of 1988 Tengen Games, a spinoff of Atari Games (which was itself the successor to the standup-arcade portion of the original Atari’s business), sued Nintendo in federal court for antitrust violations and monopolistic practices: “The sole purpose of the lockout system is to lock out competition.” Having found a way to defeat the much-vaunted lockout system through a combination of industrial espionage, reverse engineering, and good old social engineering — this is one of the few occasions in Nintendo’s history where one might accuse them of having been naive — Tengen simultaneously launched a few of their own unauthorized games for the NES.

Nintendo’s counterattack against Tengen was massive and comprehensive. Not only did they launch the expected blizzard of legal actions, but they made it clear to all of the stores that handled their products that there would be grave consequences if they chose to sell the Tengen games as well. Such threats ironically represented a far more clear-cut antitrust violation than anything found in Tengen’s original suit. When Tengen got the court to order Nintendo to cease and desist from such behavior, Nintendo allegedly only became more subtle. “You know, we really like to support those who support Nintendo, and we’re not real happy that you’re carrying a Tengen product,” a rep might say. “By the way, why don’t we sit down and talk about product allocations for next quarter? How many Super Marios did you say you wanted?” “Since it was illegal, there were always excuses,” remembers one retailer. “The truck got lost, or the ship from Japan never arrived.”

Tengen was determined to try their case against Nintendo first and foremost in the court of American public opinion. “Who gave Nintendo the power to decide what software the American public can buy?” they asked. The New York Times, for one, agreed with them: “A verdict in favor of Nintendo would probably have a spillover effect into the personal-computer industry, where it could have a chilling effect on the free flow of ideas and innovations that have characterized that market since its inception.” An opportunistic Congressman named Dennis Eckart launched a high-profile crusade against Nintendo that led to lots of heated rhetoric amid Congressional hearings and the involvement of several state Attorneys General and the Federal Trade Commission. Jack Tramiel of the other Atari (the one currently making the Atari ST computer), who had always viewed lawsuits as healthy business competition by other means, piled on with a suit of his own, claiming that by monopolizing the market Nintendo was keeping his own company from getting good software for its machines. “Nintendo has demonstrated its disregard for free and fair competition in America,” said Jack’s son and anointed successor Sam Tramiel.

Yet the anti-Nintendo sentiment in the country didn’t ultimately do much to help either of the two Ataris’ legal cases; the courts proved willing to buck that rising tide. In a landmark ruling against Tengen in March of 1991, Judge Fern Smith stated that Nintendo had the right to “exclude others” from the NES if they so chose, thus providing the legal soil on which many more walled gardens would be tilled in the years to come. Similarly, the Tramiels’ suit against Nintendo was definitively rejected in 1992, after having cost their company a great deal of time, energy, and most of all money it could ill afford. The other various and multifarious investigations into Nintendo’s business, of which there were far too many to summarize here, resulted in a mixed bag of vindications and modest slaps on the wrist that did nothing to alter Nintendo’s overall trajectory. Perhaps the best argument against Nintendo as a monopoly was the arrival of the company’s first competitors in the console space, beginning with Sega, who proved that it actually was still possible to carve out a non-Nintendo place of one’s own in the game-console industry that Nintendo had so recently resurrected.

Nintendo, then, was here to stay, as were Sega and other competitors still to come. The computer-game industry would just have to accept that and reckon with it as best they could. In the end, the threat from Japan proved not quite as apocalyptic as it had seemed during the darkest days of 1989. In 1990 computers could start to boast of a modest new buzz of their own, thanks to the new so-called “multimedia PCs” and a bunch of new games that took advantage of their capabilities. Having ceded the low ground to the consoles, computers had retained the high ground, a loyal constituency of slightly older, more affluent gamers who still had plenty of room in their hearts for the sort of big, high-concept strategy, adventure, and CRPG games that weren’t all that realizable on the more limited consoles. The computer-game industry grew again already in 1990, and by a double-digit percentage at that. The vibrant jungle of PC gaming would continue to bloom in a thousand ways at once, some of them productive, some of them dead ends, some of them inspiring, some of them kind of repugnant. And through it all, the jungle of PC gaming would remain interesting in ways that, at least for this humble writer, the fussily manicured walled garden of Nintendo has never quite managed to be. But whichever mode of distribution you personally favored, one thing became clear as the 1980s gave way to the 1990s: neither Generation Nintendo nor the emerging Generation Wintel would be going anywhere anytime soon.

(Sources: The Making of the Atomic Bomb by Richard Rhodes; Game Over by David Sheff; Compute!’s Gazette of May 1988, March 1989, August 1989, September 1989, October 1989; Computer Gaming World of September/October 1985 and June 1988; Amazing Computing of January 1989; materials in the SSI and Brøderbund collections at the Strong Museum of Play.)


  1. Activision changed their name to Mediagenic midstream in these events. Because I haven’t told the story behind that change yet, and in order to just generally avoid confusion, I simply refer to the company as “Activision” in this article. 

 

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