Even though the number of video game arcades doubled from 1980-1882 reaching a peak of 10,000 more than 2000 of them would close by 1983. The home video game industry became oversaturated, and consumers were disappointed with the games. There was a 35% decrease in profits in 1983 compared to the previous year. Major companies like Mattel left the market in 1983 even after making close to 250million in revenue in 1981, and Atari lost over half a billion...
Even though the number of video game arcades doubled from 1980-1882 reaching a peak of 10,000 more than 2000 of them would close by 1983. The home video game industry became oversaturated, and consumers were disappointed with the games. There was a 35% decrease in profits in 1983 compared to the previous year. Major companies like Mattel left the market in 1983 even after making close to 250million in revenue in 1981, and Atari lost over half a billion dollars. The industry was expected to bounce back with the release of Rick Dyers home laserdisc game system, but it was a failure. Even though graphics were improved, the gameplay was very limited. The games also cost twice as much, and players were charged more. Eventually, laserdiscs failed due to lack of interesting gameplay and the higher expenses for arcade operators.
The crash finally ended in 1985 with the release of the Nintendo Entertainment System(NES) that advanced home video games to a new level. The NES was a massive success in Japan with its release in 1983. The NES released in North America in 1985 with its huge library of games and singlehandedly helped revive the American video game industry. Computer games were also growing as an industry and with CD-ROM technology coming out around the mid-1980s both computer, and console games started using them. CD-ROMs had a higher storage capacity which meant there could be more gameplay with better graphics.
