Nolan Bushnell has said that if he had just had a couple of good nights of sleep he wouldn’t have sold Atari to Warner Communications. It is such a sad story. Warner immediately pushed Nolan out and replaced him with Ray Kassar who compared video game designers to towel designers. When the Atari 2600 became a giant success, it convinced the bosses at Warner that Ray Kassar was a genius and ignoring the fact that it was the pre-acquisition management who had the idea. There was no one looking at the quality. It all became about stuffing the channel rather than product quality.
When Atari was acquired by Jack Tramiel I thought it was good news and in retrospect it may have been the best you could have expected at the time. At least the Tramiels executed on a vision and brought things ti market. But they were quite shortsighted and miserly with costs which is not necessarily bad, but to be successful in the computer business you need more than a low price. You have to have high enough margins to reinvest in new product development. And Jack just never believed in that. At his heart he was a cheapskate who operated his businesses in kind of an unethical and very mean way.
