Stratechery Consoles and Competition
Dec 12, 2022
Explore the fierce console wars as Sony, Sega, and Nintendo adapt to the shift from 2D to 3D gaming. Delve into the landscape of video game distribution, highlighting Activision's groundbreaking role and Nintendo's revival after the 1983 crash. Unpack the heated rivalry between Sony and Microsoft, including regulatory challenges and acquisition controversies. Finally, discover how acquisitions are reshaping competition and business models, moving the industry towards subscription services and emphasizing the need for fair developer compensation.
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Magnavox vs. Atari
- Magnavox didn't profit much from Odyssey sales directly.
- Instead, they sued Atari for copying their game Pong, winning over $100 million.
Early Console Limitations
- Early video game consoles, like the Atari 2600, initially had all games made by the same company.
- This tight integration of hardware and software limited game variety.
Activision's Innovation
- The Atari 2600's cartridges separated software and hardware, enabling third-party development.
- Activision, formed by ex-Atari employees, pioneered this model.