Fergie's Tech Blog

Atari: Game Over?

In gaming, no name was linked with innovation earlier than Atari. And perhaps no one has struggled with it more than the company that now bears that name.

Three decades before $10-million video games depicted elaborate urban jungles where gamers could carjack innocent passersby, millions were addicted to a little white ball that bounced between two paddles on a black-and-white screen. Pong, the 1972 game that launched the now-$28-billion video game industry—and put Atari on the map—will live forever in the hearts of gamers.

The problem? Today’s Atari needs a big hit, soon, or it could be the next victim of an increasingly merciless business. Sales have slumped 26 percent to $395.2 million for the 2005 fiscal year from a peak of $539.5 million in 2003. Worse yet, analysts now predict Atari will lose $0.28 per share for the fiscal year ending in March, down from net income of $0.09 per share a year earlier, thanks to a dearth of new games. The result: Atari’s stock price has fallen to $1.01 from $8.59 just four years ago.

posted by Fergie @ 1/29/2006 01:41:00 PM