Ben Gilbert: observation

Transcript context

…They start working on a programmable machine that can play versions of popular arcade hits at the time. They codename it the VCS, the video computer system. As they start working on this, he and the board of Atari realize this is going to be a very different business with different dynamics than the arcade business. The first and most visceral thing they realize is, this is very capital-intensive. It takes a lot of firepower to bring a home console to market in the right way. With arcade games, you make the game, you work with a distributor like Midway, Valley, or something like that, you get it into arcades and bars, and the money comes in. The cash flow cycle is very quick. You make one of the machines and a thousand people can play it. The way to address a thousand consumers is to make a machine and let them flock to the bar to drop quarters in. But in the consumer market, things are very different. You need to get machines into retail, and then you need to get retailers and marketers behind what you're doing and build demand amongst consumers for people that have a reason to go to the store, buy your thing, and bring it home.…

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