“Atari” is one of the most famous names in gaming, and one of the most confusing. Since 1984 it has belonged to several entirely different companies at once. This is the story of the one that made the arcade games — Atari Games — and how the company behind Paperboy, Gauntlet and Marble Madness ended up with a different name, a different owner and, eventually, no name at all.
1984: One Atari Becomes Two
By 1984, the video game crash had left Atari, Inc. — then owned by Warner Communications — losing money at an alarming rate. Warner’s solution was to split it. The home computer and console business was sold to Jack Tramiel, the former head of Commodore, and became Atari Corporation, the company that would later make the Atari ST, Lynx and Jaguar.
Warner kept the coin-op division, the part that made arcade machines, and renamed it Atari Games. Within months, Japanese arcade giant Namco took a controlling stake. So from 1984 there were two Ataris: one making home computers, the other making arcade games, and neither allowed to tread on the other’s toes.
The Golden Run
What followed was one of the great creative streaks in arcade history. In late 1984 came Marble Madness, with its trackball and impossible isometric courses. In 1985 came two games that defined the year: Paperboy, this month’s Looking Back game, and Gauntlet, the four-player dungeon crawler whose narrator’s warnings — “Elf needs food badly” — became catchphrases.
The hits kept coming: Super Sprint and Road Runner in 1986, RoadBlasters in 1987, the pioneering 3D driving of Hard Drivin’ in 1989, puzzle game Klax in 1990, Rampart in 1991, and the claymation fighter Primal Rage in 1994. Atari Games’ house style was inventive hardware and unusual ideas — handlebars, trackballs, steering wheels, four players at once.
Tengen and the Fight With Nintendo
Atari Games couldn’t sell home games under the Atari name — that belonged to the other Atari. So in the late 1980s it launched a home label, Tengen, to bring its arcade hits to the NES. Unhappy with the restrictions Nintendo placed on publishers, Tengen began releasing cartridges that got around Nintendo’s lockout chip, and released its own version of Tetris.
The result was one of gaming’s most famous legal battles. Nintendo held the console rights to Tetris; Tengen’s version was pulled from shelves, and the disputes dragged on for years before settling in 1994. Tengen’s Tetris is now a sought-after collector’s item, largely because so few copies survived.
Losing the Name
The 1990s were harder. Time Warner took back control in 1994, then in 1996 sold Atari Games to WMS Industries, the company behind Williams and Bally Midway. When WMS spun off Midway Games, Atari Games came with it — and in 1999 it was renamed Midway Games West. The Atari name was gone from the company that had carried it longest in the arcades.
Midway left the arcade business in 2001, and Midway Games West was closed in February 2003. When Midway itself went bankrupt in 2009, most of its assets — including Atari Games’ library of arcade classics — were sold to Warner Bros.
Why Atari Games Still Matters
That history explains a lot about retro gaming today. The Atari you see now — the company behind Atari 50, the recent Atari emulation and film deals covered in our news pages — descends from the home side of the business, not the arcade side. Many of Atari Games’ greatest hits sit with Warner Bros instead, which is why games like Paperboy and Gauntlet turn up in Midway compilations rather than Atari ones, and why they’re harder to buy today than you’d expect.
For a decade, though, Atari Games was the most inventive arcade company in the West: the one that put handlebars on a cabinet, gave four strangers a dungeon to share, and taught a generation to fear the words “Wizard is about to die.”
Looking Back: Companies is a monthly series on the studios behind the games. Previous: SNK. This month’s game: Paperboy (1985).
