How failure, copycats, and flops helped Atari find success

- Bushnell shared his first impressions and experiences with the game that would eventually become Pong. 

A recent episode of NPR's How I Built This podcast sat down with Nolan Bushnell to explore how Atari sprung up out of his early interest in business and carnival games.

The podcast episode offers game developers an interesting look at an important slice of video game history and the foundation of one of the most iconic game companies, straight from the lips of the co-creator himself. 

Speaking to NPR, Atari founder Nolan Bushnell told the story of how he got into the arcade machine business, started the company Atari, and ultimately facilitated the creation of Pong. His early arcade machine efforts were a combination of his early life working at carnival midways and his college encounter with the game Spacewar. 

After being mesmerized by that early video game experience, Bushnell said he wanted to somehow bring that game to his arcade but, at the time, the technology to do so was too expensive. Later on, he would partner with his then co-worker Ted Dabney to create a multiplayer version of the game for arcades. Despite making enough money for Bushnell to consider it successful, as far as the arcade industry was concerned it was a flop. 

The pair later brought on a new employee, Al Alcorn, who helped create the game that would eventually become Pong. The tennis-inspired multiplayer game was released into the wild shortly after and quickly became a success. 

Bushnell recalls that his company received a service call at one point because that one cabinet had become so popular that the coin-box within the machine was completely full. At the time, a Pong cabinet was pulling in $300 a week, which was roughly the same amount as the cost of the arcade machine.

However without production power or patents, other companies started to take advantage of the game's success by churning out their versions of the cabinet. That, and a jump in technology, led Bushnell to look for ways to bring the game from bars and arcades directly into the homes of players. 

“We started out essentially designing this little game looking thing out of wood and painting it so it looked like plastic, but it was really wood. Our idea was to take it to the toy show in New York,” shared Bushnell, who says the system's $79 price tag kept it from capitalizing on that show. “We sold zero. It was a great demo and everything, but what we didn’t know was that the toy business, at that point in time, did not sell anything that was more than $35.”

The full episode of How I Built This dives further into the story of Bushnell's career, including more on the history of Atari and how his arcade experience would eventually him to found another company: Chuck E. Cheese.