It was the best of times...
It began with an epic crunch by one of the most talented developers in Atari's history. It ended quite literally buried in a New Mexico desert. What lies between is one of the most epic and tragic stories in video game history,
Howard Scott Warshaw was only 25 in 1982 and riding high as one of Atari's most talented developers. Warshaw already had a couple of very successful games under his belt in Yars' Revenge and Raider's of the Lost Ark.
Steven Speilberg had personally chosen Warshaw as the designer of Raider's of the Lost Ark for Atari based on the success of his prior hit, Yars' Revenge. Warshaw had 10 months to develop the game and was able to deliver a very strong product. Consumers agreed and Raider's became a big hit for Atari.
This success led to Steven Spielberg asking if he could do the same for ET, but there was a snag...
While he had 10 months to develop Raider's of the Lost Ark, he only had 5 weeks to develop and release ET. For those who are math inclined, he needed to do the exact same thing in 12% of the time.
Warshaw went to work non-stop for the ensuing 5 weeks.
Through some unexplainable miracle that no one can truly explain (coffee...lots of coffee), Warshaw was able to complete the game in only 5 weeks. Speilberg played the game and approved it for distribution. The marketing campaign fired up.
This was to be a HUGE Christmas for Atari. Having paid $22 million for the rights to ET alone, they expected this would more than make the money back. They produced 5 million cartridges in preparation for the huge rush they expected.
What happened next would shake not just the company, but the entirety of the video game industry for years to come...
The game came out and initially it sold well. But word got around quickly about the poor gameplay. Players kept falling in the pits and could not get out. The instant they got out, they would fall back in again. Frustrated gamers gave up and the returns started coming in.
The losses Atari took started snowballing and eventually they were $563 million dollars in the hole. The debacle would lead to two tragic and infamous events that have become the stuff of videogame fokelore...
After losing $563 million, Atari was in trouble. In addition to its disaster with ET, Pac-Man was not doing very well. Rising competition from Activision, Imagic, and Parker Brother's had also hurt its revenue shares. Add to that Atari CEO Ray Kassar's insider trading problems with the SEC and Atari was starting to crumble.
Immediately on the horizon was the video game crash of 1983. The entire industry would shrink from $3.2 billion in revenue to just $100 million in revenue (almost 97% drop) in a very short period of time. Careers were ruined and companies went under.
Atari was left with a ton of unsellable cartridges in its inventory. The legend goes that Atari took all of these unsellable cartridges and buried them in a New Mexico desert landfill. Atari was forced to restructure, split itself off, and sell itself off (eventually becoming Atari Games and being sold to Namco in 1985).
So how did this disaster affect Warshaw's career?
Warshaw's career was ruined. While he spent the time of restructuring developing and almost releasing a title called Saboteur, its completion was never to be as he left the company during the restructure.
He spent the ensuing years writing 2 books (The Complete Book of PAN, Conquering College), worked on his own documentary (From There to Here: Scenes of Passage), and became a licensed psychotherapist in 2012.
In April 2014, he would take part in an excavation at the New Mexico landfill that would turn up more than 1,300 cartridges of original Atari titles. Former Atari manager James Heller would later confirm that over 728,000 cartridges had met that fate (many of them successful titles).
Its not all terrible news however. Warshaw is probably celebrated more than ever today for his role in Atari back in the early 80's.
His game, Yars' Revenge, was accepted into the Museum of Modern Art's video game collection where he was listed as a contributing artist. His fame got him bit parts on Code Monkeys and Dean in Charge. Additionally, he got to play himself as a mad scientist in Angry Video Game Nerd: The Movie (of which the plot was about the burying of the ET cartridges).
What a run as an artist. Two books, a documentary, and several Atari titles to his name. Imagine if he had 10 months to produce ET and how much better it probably would have been.
For more information on this legendary developer and Atari's downfall, see this, this, and this.