Nintendo Bled Atari Games to Death

Summary

How Nintendo Bled Atari Games to DeathBehind every great console is a great legal fight.BeeLine Reader uses subtle color gradients to help you read more efficiently.In July 2024, a new company called Tengen Games released its first game, “Zed and Zee,” for the Nintendo Entertainment System (NES). The surprising part of this story is not the release of a new “homebrew” game for a system released in 1985 — hobbyist computing has been visible since at least the 1970s — but that Tengen and its parent company, Atari Games, had disappeared 30 years ago after being crushed in court by Nintendo for doing exactly the same thing: manufacturing unauthorized cartridges for the NES.This story isn’t just a curiosity — it highlights how the gaming industry, like many creative fields, is defined as much by legal and business decisions as by artistic vision. Behind every major shift, there’s a dance between engineers, lawyers, and business leaders, visible only to a few insiders. Nintendo’s lawyers, more than Mario, made Nintendo. Atari’s lawyers, more than ET — notoriously the worst game of all time — sealed its downfall.To illustrate these points, let’s take a walk down memory lane with Atari and Nintendo. Press Rewind on that analog tape deck. The year is 1979. Atari is at the peak of its commercial success, but the mojo is gone. The freewheeling culture has been replaced by the Brioni suits and New York secretaries of new owner Warner. The existing industrial arrangement at the time was that of a bundled console-plus-cartridge business model, where the console manufacturer (say, Atari with its VCS/2600) sold the console at a loss and cross-subsidized it with the money made on cartridges sold with a huge profit margin.Nintendo’s lawyers, more than Mario, made Nintendo. Atari’s lawyers, more than ET, sealed its downfall.Except, the game designers were paid a flat salary, not royalties, unlike the rock stars in Warner’s stable. In late 1979, four defecting Atari designers and one m...