Atari_What Happened

Atari_What Happened - Prepared for: Texas State University...

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Groundbreaking Press, Austin, TX – w w w .groundbreaking.com – © 2007, Brad Fregger Prepared for: Texas State University McCoy College of Business Administration Management 3303.254 – Spring 2008 Atari – What Actually Happened How Arrogant Ignorance Destroyed a Company and an Industry by Brad Fregger Nolan Bushnell started the Atari Corporation in 1972, with $250, when he was 29 years old. They had a smashing success right from the start, PONG. Four years later he sold the company to Warner Communications for 28 million dollars. Warner Communications put Ray Kassar, a Burlington Mills, fabrics executive in charge of the company. In his opinion Atari was selling a commodity, a product much like any other product. Nolan had stayed, continuing to lead his old company, but it wasn’t doing well, sales and profits were falling off and Kassar was supposed to turn it around. There was no way that the two could work together, Nolan was the Silicon Valley archetype, casual dress, intuitive thinking, and flex hours. Kasser was the opposite. He worked all the time, dressed impeccably, and thought bottom-line. Warner and Kassar kept tight control over all phases of the company from the creation, through to the manufacturing and distribution of the product. In 1981 Atari controlled 75% of the video game market and accounted for two-thirds of Warner’s profits. By 1982 Atari had become a two-billion dollar-a-year empire and the fastest growing company in the history of American business. By the end of ‘83 the end was in sight and the fall of Atari was imminent. What happened to cause this
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Atari_What Happened - Prepared for: Texas State University...

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