Replay: The History of Video Games (27 page)

Mario man: Shigeru Miyamoto shows off his banjo skills. Nintendo UK

13. I Could Have Sworn It Was 1983

Nintendo was a laughing stock. It was 1984 and the company was touting the Advanced Video System, the US version of the Famicom, at the trade shows. To avoid associations with Atari, Nintendo tried to distance its unreleased system from the consoles of the past by encasing it in video-recorder grey and showing off a keyboard attachment that turned it into a home computer. Nobody was fooled. This Japanese company was trying to bring back the home console just months after the whole video game business went down the tubes. The businesspeople, retailers, analysts and journalists at the trade shows laughed, pointed, teased and rolled their eyes, amazed by the audacity of these Japanese no-hopers.

Nintendo realised its plans had to be binned. Again. The previous year, just as the Famicom launched in Japan, Nintendo had sought to persuade Atari to bring its console to the US market. The marriage of Atari’s brand and Nintendo’s games would be a winning combination, the Japanese company thought. It was not to be. “Nintendo came to us and said do you want to make the Famicom?,” said Manny Gerard, the Warner Communications executive in charge of Atari. “They wanted us to distribute and make the Famicom. We had enough crises of our own at that point and we couldn’t deal with it.”

It looked hopeless for Nintendo. Atari had become the video game ground zero and had convinced the world that game consoles were finished; a historical footnote, an electronic Hula-Hoop. This was not a view that Hiroshi Yamauchi, Nintendo’s chairman, was prepared to accept. The Famicom had succeeded in Japan, so why not in the US? He insisted that his son-in-law Minoru Arakawa, the president of Nintendo of America, find a solution.

Arakawa re-examined the state of the video game industry. Sales were collapsing fast. Game publishers were scrambling onto the home computer life rafts. Retailers burned by the Atari fallout wanted nothing to do with video game consoles ever again. Everything seemed stacked against Nintendo, but then Arakawa noticed something that all the business analysts with their heads buried in profit-and-loss accounts had paid little attention to: the kids of America were still playing video games. Thwere playing them on home computers and they were still pumping quarters into coin-op game machines. The players, he concluded, were not bored of games as a concept, just the average or substandard ones.

He ordered a second redesign of the Famicom but this time as an unashamed, out and proud games console: the Nintendo Entertainment System or NES for short. Given his conclusion that the quality of the games would make or break for the system, Arakawa embraced the Japanese licence system for the Famicom and added a security chip to the NES so Nintendo could dictate what was available on its console. Any company that released an NES game without a licence, Arakawa decided, would risk legal action. Not that anybody outside Japan was interested in making games for the NES. “Numerous consoles had failed prior to the NES,” said Trip Hawkins, co-founder of Electronic Arts, which was more focused on the latest home computers such as the Commodore Amiga and Apple Macintosh. “The entire US game industry thought the NES was a big step backwards. Worse, the licence agreement was completely draconian and reduced a publisher to being a captive developer with no control over its business.”

Nintendo did not care what the US publishers thought. It had dozens of great games from Japan that it could bring to the US, many already well known through the arcades. Nintendo’s real problem was the retailers. If they refused to stock the NES, all was lost. Arakawa decided the NES needed some gimmicks to distance it from earlier systems. Nintendo came up with two – the Zapper light gun and a 24-centimetre high robot called R.O.B. or Robotic Operating Buddy. The Zapper had already proved popular in Japan thanks to shooting gallery-style games such as
Duck Hunt
and
Hogan’s Alley
. In Japan the Zapper was designed to look like a real firearm, but fearing criticism from anti-gun campaigners, Nintendo redesigned it as a laser gun for the North American market. R.O.B., meanwhile, helped people play by watching the action on screen and moving physical objects around that affected the game such as moving blocks to open doors in the dynamite-collecting game
Gyromite
.

Nintendo made the Zapper and R.O.B. the core of its NES marketing efforts in the hope of thawing the frosty attitude towards its games machine. But retailers attending the June 1985 Consumer Electronics Show remained unmoved and showed no interest in stocking the NES. The redesign also went down badly with the children invited to Nintendo’s focus groups. Arakawa called Yamauchi and told him it was time to admit defeat. The US was simply not interested. Yamauchi refused. He rejected the verdict of the focus groups, declaring market research to be a waste of time and money. He told Arakawa to focus on making the NES a success in one American city before going national. Nintendo chose New York City, which was seen as the toughest city to crack in US. The reasoning was that if Nintendo could sell the NES to New Yorkers, it could sell it to anyone. Yamauchi gave Arakawa and his team $50 million to bankroll its assault on the Big Apple. The key staff from Nintendo’s Seattle headquarters packed their bags and moved to New Jersey to work around the clock and make the NES a Christmas 1985 success story. Nintendo offered money-back guarantees to retailers, spent millions on advertising and showed off the Zapper and R.O.B. to shoppers in malls across the city. By Christmas Eve the NES was on sale in more than 500 New York stores. The push worked. That Christmas New Yorkers bought 90,000 NESs. The majority of the retailers recruited thans to the money-back guarantee, agreed to continue stocking the console and its games. Nintendo then set about doing the same in Los Angeles, then Chicago, then San Francisco, then Texas before finally launching the NES throughout the US.

And when Nintendo released Shigeru Miyamoto and Takashi Tezuka’s game
Super Mario Bros
in the US in March 1986, the NES went supernova.
Super Mario Bros
marked the return of Mario, the barrel-jumping hero of
Donkey Kong
, and transported players into a Dr Seussian cartoon world of secret rooms, cuddly enemies and day-glo landscapes. Along with 1984’s
Pac-Man
spin-off
Pac-Land
,
Super Mario Bros
heralded a new era for platform games. Instead of confining the action to a single screen,
Super Mario Bros
offered the thrills of exploration in a virtual playground far larger than player’s TV sets and where there was always some unexpected delight around the next corner. It could be a castle with a moat of lava, a beanstalk stretching into the sky to climb or an
Alice in Wonderland
-inspired magic mushroom that turned Mario into the giant Super Mario.

For Miyamoto it was a game that, like
The Legend of Zelda
, recreated the joy he felt as a child exploring the countryside around Sonobe. And for a generation of American and Japanese children whose freedom to wander, explore and play outside was being curtailed by urban growth, it was a virtual substitute.
Super Mario Bros
became a global phenomenon; millions of copies were sold alongside millions of the NES consoles needed to play it. Nintendo and its Japanese licensees added to the momentum of
Super Mario Bros
with a steady supply of quality games such as Miyamoto’s
The Legend of Zelda
, Gunpei Yokoi’s sci-fi action game
Metroid
, the vampire-themed adventuring of
Castlevania
and versions of arcade hits such as the street-fighting smash
Double Dragon
. Soon Wall Street analysts were throwing their weight behind Nintendo and the retailers who once dismissed the NES changed their minds.

By summer 1987’s Consumer Electronics Show, it was clear that the video game console was back. In between the digital guitars, prototype CD-Video players and black-and-white video phones on display were enough video games to prompt
Popular Mechanics
’ correspondent to remark: “I could have sworn it was 1983.” Other reporters agreed.
The Milwaukee Sentinel
described it as “one of the biggest comebacks ever”.
Fortune
credited Nintendo with “single-handedly” reviving the games business. Few in the business would have disagreed. “Nintendo came out of nowhere. They were ballsy and they rebuilt the videogame console market,” said Michael Katz, the former Coleco executive turned Atari Corporation vice-president. By December 1987 American children were snubbing traditional favourites such as Barbie and G.I. Joe dolls and asking for a Nintendo instead.

Nintendo, however, was keeping a tight control on the supply of its system. Partly because it could not keep up with the demand it had created, but also because it was haunted by the collapse of Atari in the early 1980s. Nintendo worried that retailers would slash the price of any excess stock, leading to the kind of discounting that helped destroy Atari. The tight control of supply also gave Nintendo more influence over retailers and generated a buzz about the NES because it sold out the moment it arrived in shops.

Egged on by limited supplies and huge demand, the NES became the hottest toy of Christmas 1987. Parents desperate to please their children with a gift-wrapped Nintendo under the tree trawled the shops, hunting for the elusive present. As Christmas approached they became increasingly feral. “They’re upset that we don’t have it,” one sales clerk told
The Milwaukee Sentinel
. “Now that it’s getting closer to Christmas, they are getting ruder.”

Supplies of Nintendo products may have been strictly controlled, but enough were sold that Christmas to make the NES the US’s number one selling toy of 1987. The game publishers who once laughed at Nintendo were now begging for a licence to make NES games. Those that signed up were subject to exacting rules and controls that placed Nintendo in a position of incredible power over the video game business. Licensees had to pay Nintendo to manufacture their game cartridges so even if the game sold badly Nintendo made a profit. Nintendo also took a cut of every NES game sold, dictated when the game could be released, told licensees how many games they could release every year, and got to decide whether a game was good enough to be released.

Attempts to bypass Nintendo’s rules were stamped on fast. Australian game developer Beam Software was one of those who incurred the wrath of Nintendo. Shortly after the NES appeared, Beam worked out a way to get around Nintendo’s security protection and used this knowledge to create a development system that it hoped to sell to NES game publishers. “Our systems were much more user-friendly than the Nintendo ones and certainly less expensive upfront. We managed to sign-up one publisher before word of this reached Nintendo,” said Alfred Milgrom, the co-founder of Beam. “It didn’t take long for the heavy arm of Nintendo to come down on us. The word was that any publisher who signed up with Beam for development systems would lose their licence.” And with no publisher willing to lose access to the millions of NES owners, Beam was in trouble. “It was crucial to us – if we could not resolve this problem, Beam was out of business,” said Milgrom. “The situation was horrific. That’s when we really knew that Nintendo had enormous power, because they made it clear that if we didn’t withdraw our system we’d never be able to do anything in games ever again.”

Panicked, Milgrom made frantic calls to Nintendo’s Seattle offices trying to speak to Arakawa about the situation. “I kept phoning him every half an hour saying ‘can I come over and can I talk to you’,” he said. “After a while he rang the president of our publisher Acclaim and said: ‘Why is this guy pestering me and calling everylf an hour?’. He said: ‘Well you did say you were going to put him out of business’.”

Beam saved itself by agreeing to become a Nintendo licensee. “Once we were in the family the reality was different,” he said. “Nintendo’s a big paternalistic company, it’s a lot like a dictatorship. Nintendo say ‘here you are in our family, but you’re going to have to obey the rules of the family’. It’s quite strict and obviously Japanese.”

Nintendo’s standards were exacting. “In terms of game testing they revolutionised the concept,” said Milgrom. “They said zero defects – we will not allow you to release a game that has any bugs in it whatsoever. Now zero defects was an unheard of concept in any other software or on any other gaming platform. Nintendo knew if they were going to sell it in the supermarkets and sell it to mums and dads it had to work off the shelf and had to be flawless. They didn’t want returns. We had to change our programming attitude and the way we developed games, which was brilliant. It was really hard work. If you had a bug in your final version you could miss Christmas because it would take a month for them to go through the testing of the title.”