33
Guardians of the Galaxy
In April 1976, longtime coin-op industry executive Sam Stern retired.1 Save for a brief stint at Bally between 1969 and 1971, Stern led the Williams Electronic Manufacturing Company, renamed Williams Electronics in 1967, from 1959 and presided over a sustained period of innovation that left it the number two pinball company behind first Gottlieb and then Bally. The later years of his tenure also coincided with a great deal of corporate upheaval.
In 1964, Williams became a subsidiary of Seeburg Corporation, the conglomerate formed by Delbert Coleman and Herbert Siegel to dominate the coin-operated music, vending, and amusement manufacturing industries. In May 1965, Coleman brought a new protégé into Seeburg named Louis Nicastro, a Columbia University graduate and New York financier who rose from mail boy to senior auditor of the Bowery Savings Bank and then spent a decade at Inland Credit. Four months after joining the company, Nicastro was promoted to executive vice president of Seeburg. In 1966, he became president and chief operating officer.2
By 1968, Seeburg had purchased a few more companies, but had basically topped out its growth potential. At that point, Coleman and Nicastro sold their shares in the company to Commonwealth United Corporation,3 a conglomerate that started in real estate in 1961 and entered the television and movie production business in 1967. Commonwealth subsequently purchased the rest of Seeburg to turn it into a wholly owned subsidiary. Coleman left the firm, while Nicastro became chairman of Seeburg and president of Commonwealth United. He resigned the latter position in April 1969 under mysterious circumstances. Not long afterwards, Commonwealth shares collapsed after it could not pull together the capital for another acquisition, and it was revealed the company was fast losing money as its entertainment investments did not pan out.
Nicastro added the role of CEO at Seeburg in August 1969 and was invited back to Commonwealth as CEO in January 1970 following a power struggle over the future direction of the company.4 He began deconglomerating by spinning out Commonwealth’s real estate and insurance companies to refocus the firm solely on entertainment. Revenues at Seeburg continued to outpace the rest of the organization, but the company lost money for the first time in its history in 1969 and 1970, in part because it had trouble securing credit to buy parts due to Commonwealth’s difficulties with the banks. Through a refinancing deal, Nicastro brought Seeburg back to profitability in 1971 and then established a new independent company in 1972 called Seeburg Industries. In December 1972, Seeburg Industries acquired Seeburg Corporation from Commonwealth.5
The separation from Commonwealth did not end the trouble at Seeburg, for in the early 1970s the jukebox business was collapsing in the United States. Wurlitzer exited the business in 1973, which led to product dumping that severely impacted Seeburg’s bottom line. Nicastro almost sold Williams to Sega in 1975 when the Japanese company was looking to establish a base of operations in the United States, but the deal fell through. In 1977, Nicastro decided to sell the jukebox business instead. After all its distributors turned down the opportunity to purchase the business, Nicastro almost reached a deal with its Japanese agent, Taito, but this deal collapsed at the last minute just like the Sega deal two years before because Mike Kogan was leery of taking on the company’s debts.6 Nicastro ended up spinning off the jukebox business into a separate company named Seeburg Corporation in 1977 that became a subsidiary of yet another firm called Consolidated Entertainment, Inc. owned by his sons.7 To distance Seeburg Industries and the original Seeburg Corporation from the money-losing jukebox business, he changed the names of the firms to Xcor International and Xcor Corporation, respectively.8
Stern retired during this latest turmoil, but soon discovered he did not enjoy sitting around all day and desired a new project to occupy his time. His son, Gary, provided one. A regular at the Williams factory since he was a young child, Gary first worked for the pinball company as a summer employee in the stockroom when he was 16 years old. In subsequent summers he also worked in the inventory, human resources, accounting, and design departments. After graduating from Tulane University in 1967 with an accounting degree, Gary decided he was done with school, but his father convinced him to study law, and he received a law degree from Northwestern University in 1971.9
By the time he graduated law school, Gary’s father worked for Bally, so he joined the firm as a law clerk specializing in slot machine law. In 1973, he followed his father back to Williams and took on a variety of jobs under the title assistant to the president, including managing the company’s new attempt to challenge Bally in the slot machine business. Williams never managed to compete successfully in slots, so after his father retired, Gary departed in 1976 and formed a company with a friend to deliver free-to-play slot machines to Canada. When his mother told him that his father needed something to get him out of the house, Gary and his brother, a physician named David, purchased the assets of Chicago Coin out of bankruptcy in 1976 and formed a new pinball company called Stern Electronics.10 The brothers financed the purchase through a $2.7 million loan from Drovers Bank and $500,000 in private financing, including a sizeable contribution from Stern family friend and Service Games founder Marty Bromley, who was awarded half the firm’s voting stock.11 Gary served as president of the new company, while his father generally worked half days as an advisor.12
Stern released its first pinball games in early 1977, which were a combination of new designs and Chicago Coin backstock. The company quickly ran into difficulty because the industry was shifting to solid state, yet Stern only had the capability to create electromechanical designs. Another longtime Stern family friend, Bally CEO Bill O’Donnell, came to the rescue by providing a Bally table and giving his blessing to reverse engineer it to develop a solid-state system in return for royalties.13 To create its solid-state machines, Stern contracted with URL, the firm that helped Allied Leisure break into the video game market with Paddle Battle. URL was undergoing its own challenges at the time due to both the failure of its recently established coin-operated video game manufacturer, Electra, and its Video Action home video game line, so Gary Stern shepherded URL through bankruptcy proceedings and purchased the company.14
Stern realized its first hit in March 1978 with a solid-state game called Stars that sold just over 5,000 units. By 1979, Stern had become the number four pinball company with around 23,000 units sold, many of them shipped to international markets. While this modest total put the company well behind Bally (80,000 units), Williams (60,000 units), and Gottlieb (46,000), Stern was profitable and ready to expand. In 1980, it bought cabinet manufacturer August J. Johnson Co. and purchased Seeburg Corporation out of bankruptcy from the Nicastro family for $1.5 million to enter the jukebox business.15
The Seeburg bankruptcy had a negative effect on Xcor, which still had close ties and some financial stake in the company. Combined with disruption of its vending machine manufacturing operations due to a tornado, Seeburg’s difficulties left Xcor with a $2.4 million loss in fiscal 1979.16 Williams remained profitable, so Nicastro engineered another spinoff. On March 5, 1981, Xcor sold 20% of Williams’ stock in a public offering and used the proceeds to pay down its debt.17 Then on May 29, the company distributed the remaining shares among its own shareholders, making the pinball company independent again for the first time in 17 years.18 Louis Nicastro remained the CEO and ran the firm from his native New York, where he had relocated in 1973.
Neither Williams nor Stern were initially interested in video games. Williams had jumped on the ball-and-paddle bandwagon back in 1973 just like everyone else, but had not released any games since 1974, while Stern ignored the video game business entirely in its first three years of operation. By 1980, no coin-operated amusement manufacturer could ignore video. As video game coin drop hit $2.8 billion, pinball’s take fell from nearly $2 billion in 1979 to just shy of $1.7 billion and appeared poised to drop further as demand for new pinball machines sharply declined.19 Both Williams and Stern introduced video games before the end of 1980, and the releases of both companies played a critical role in the further growth of coin-operated video games in 1981.
***
Williams’ video game activities sprang directly from its work to develop a solid-state pinball machine. Shortly before he left the company in early 1976, Sam Stern began putting out feelers about developing a solid-state hardware. Subsequently, Louis Nicastro reached agreements with National Semiconductor and Rockwell International to each take a stab at developing such a system. National put its head of microprocessor system development, Mike Stroll, in charge of its efforts.20 Nicastro took a liking to Stroll and hired him into Seeburg Industries in October 1976 to serve as VP of Technology and continue work on the solid-state system in house.21 Stroll brought three engineers into Williams to finish the system: Ron Crouse, Dave Poole, and Ken Fedesna.22 They developed a system based around the Motorola 6800, while a second team at Seeburg also worked on a prototype after National Semiconductor showed off its SC/MP processor. The Seeburg project was ultimately abandoned in favor of the Williams system.23 In May 1977, the Williams team tested its system by converting five Grand Prix games to solid state and putting them out on test,24 after which Williams deployed its first mass-produced solid-state game, Hot Tip, in September.25
In December 1977, Stroll became president of Williams Electronics.26 He immediately began expanding the pinball division by bringing in new designers and engineers comfortable working with solid-state technology, of which the most notable was Steve Ritchie. A native of San Francisco, Ritchie joined the Coast Guard after graduating high school in 1967 to avoid service in Vietnam but ended up being sent there anyway. After leaving the service, he became an electronics technician and joined Atari in 1974 as an assembly-line worker. An avid pinball player since he was a child, in 1976 Ritchie asked for a transfer to the company’s new pinball division. Once there, veteran pinball designer Bob Jonesi took Ritchie under his wing and taught him how to design a pinball playfield. He subsequently designed two tables for the company, Airborne Avenger and Superman.27
Shortly before the release of Superman in 1978, Ritchie met Stroll and accepted an offer to come work for Williams.28 His first game for the company, Flash, introduced a continuous background noise that rises in pitch and increases in tempo the longer the player keeps his ball on the playfield. This effect created a similar degree of tension and excitement as the background music in Space Invaders to provide a pinball experience almost as exhilarating as the hit video game. Released in January 1979, Flash set a new sales record for Williams by moving 19,500 units and remained a top moneymaker for three years.
Later in 1979, another former Atari pinball division employee joined Ritchie at Williams. Eugene Peyton Jarvis was born on January 27, 1955 in Palo Alto, California. As a boy, he discovered pinball in the backroom of a local haunt called Johnny’s Smoke Shop, which became a favorite pastime. In high school, he saw his first computer on a school trip, and while hanging around the Stanford University student union, he watched college students try their hand at the Galaxy Game. Despite a burgeoning interest in technology, when Jarvis matriculated to UC Berkeley in 1973, he majored in biochemistry. Before long, he switched his major to computer science and began writing programs on a CDC 6400 computer. He also started playing marathon sessions of Spacewar! on an old IBM mainframe hooked up to an oscilloscope in the basement of the university physics lab.29
Shortly before Jarvis graduated, Atari came to campus to conduct interviews. He sat down with representatives of the company, but never heard back. Upon graduation, he took a job with Hewlett-Packard, but quit after just three days because he could not stand his assignment to help write a COBOL compiler. At that point, Atari finally called out of the blue and offered him a job as a programmer in the pinball division. Within two weeks, a series of departures and transfers left him head of programming for the entire division.30
Jarvis felt Atari’s tables had good play appeal, but they were plagued by unreliable hardware and manufacturing difficulties. By 1979, dealing with these challenges left Jarvis burned out, so he quit.31 He spent a few months in South America and worked for his father for a time but found he missed the coin-operated amusement industry, so when Ritchie called a few months later to say there was a job waiting if he wanted it, Jarvis joined Williams.32 His first project was to create the sound for Gorgar, the first pinball table to incorporate speech. Next, he served as the programmer for Ritche’s Firepower, the first solid-state pinball game with a multi-ball feature. While Firepower’s sales of 17,400 units lagged slightly behind Flash, it was arguably more successful, as it remained the top earning pinball table for a year after its January 1980 release and stayed in the top five for another year after that.
Once Space Invaders took hold of the marketplace, Mike Stroll organized a new skunk works team headed by Ken Fedesna in late 1979 to bring Williams into the video game business. Composed of a combination of new hires and engineers from the pinball division, the group was placed in the building that previously housed the company’s defunct slot machine operations to keep it free of distraction.33 Jarvis had fallen for Space Invaders hard, so he asked to join the group.34
The Williams video game team did not want to copy what came before: they desired to set a new standard. Therefore, in developing a video game hardware system they stuffed it with state-of-the-art components. The processor was a 6809, Motorola’s latest 8-bit chip that incorporated some 16-bit features. A second processor, the 6808, drove the sound on the system. Perhaps most significantly, at a time when color was still a rarity in the arcade the Williams hardware could generate 16 colors on screen at once from a palette of 256.
As the hardware came together, Jarvis led efforts to create the company’s first game. His first concept was basically Space Invaders, but with the added ability to shoot diagonally. It was not fun. Next, Jarvis looked to the latest arcade hit, Asteroids, and created a game with a rotating turret that shot at targets, but without high-resolution vector graphics the game looked terrible, and this idea was also set aside. For his next idea, he combined the two. One feature the Williams team liked about Asteroids was that if you flew off the screen in one direction, you would reappear on the opposite side of the screen. Jarvis thought it might be fun to have the screen scroll instead to reveal a larger playing area. To avoid the graphical problems that came with rotating an object, he decided to have the ship move horizontally only and then basically turned Space Invaders on its side to have the player shoot at objects appearing from the right side of the screen. As in Asteroids these objects included rocks that would break into smaller pieces when hit.35
After roughly six months of work, Williams now had a game concept, but it still was not fun. Jarvis’s old pinball partner, Steve Ritchie, checked out a build and suggested that the player should be able to turn around to move in both directions instead of just left to right, but even adding this feature did not really increase playability of what the team was now calling Defender. Jarvis’s next move was to add friendly objects on the screen that the player needed to avoid shooting to break up the monotony of blasting everything in sight. A planetary surface was duly implemented with little astronauts running around. Next, Jarvis ditched the asteroids and introduced alien ships that land on the planet to abduct the astronauts, changing the paradigm of the game from just blasting targets in space to protecting a population. Subsequently, he decided that rather than an astronaut just disappearing when abducted, it would be carried to the top of the screen and turned into an evil mutant if the player did not blast the lander that had grabbed it. Finally, the game started to feel like a winner.36
Defender debuted at the AMOA show in October 1980. The game looked spectacular thanks to its vibrant colors and beautiful algorithmically generated explosions implemented by teenage prodigy Sam Dicker, who also programmed the sound. It was also hellishly difficult to play. Jarvis came from the pinball world and borrowed the conventions of that game in which activity is happening all over the playfield and the player must prioritize targets and bring order to the chaos. Unlike pinball and its two flipper buttons, however, Defender is controlled with a two-way joystick that moves the ship up and down and five buttons: a thrust button for movement, a reverse button to change direction, a fire button, a button to deploy a screen clearing smart bomb, and a hyperspace button that works as in Spacewar! and Asteroids. In addition to complex controls, a variety of enemy types swarm all over the screen and move randomly rather than in learnable patterns. A typical player may not even last five seconds on his first quarter, and even with score chasing reaching the height of popularity, distributors and operators at the show thought the game too hard to attract significant business in the arcade.37
When the first sample shipments of Defender started reaching locations in December 1980, the AMOA attendees were proven wrong.38 By now, the top Space Invaders and Asteroids players had learned tricks and exploits that allowed them to play for hours on a single quarter, and they required a new challenge to test their increasingly impressive skills. By spring 1981, Defender had dethroned Asteroids as the top earning game in the United States. It remained in production all year and ultimately sold 55,000 units.39
Defender was not the first scrolling video game, as it was preceded by multiple driving games that depicted a constantly shifting road or track, as well as the Atari Football game with its 100-yard field. Even other shooting games had incorporated scrolling elements to good effect, such as Galaxian with its starfield. Defender felt different, however, because it took place within the boundaries of a complete world occupying more than one screen of real estate with a distinct and fixed geography through which the player had near complete freedom to navigate his vessel. Defender also cemented the need for a game to have color graphics to stand out in the arcade. In fact, its appearance at the AMOA prompted frantic last-minute changes to another game that premiered at the show, the first original Stern Electronics video game, Berzerk.
***
When Stern decided to enter the video game business in 1979, the company asked its URL subsidiary to put a game together. Organizing a team fell to Tony Miller, a former Seeburg and Dave Nutting Associates engineer. While at DNA, Miller had created the original version of the keyboard add-on for the Bally Professional Arcade, and when it ended up being scrapped, he grew disillusioned and left the company to become the chief engineer at URL. When told to staff up for the video game project, he poached some of his former co-workers,40 notably Terry Coleman, who designed many of the custom chips in the Bally Professional Arcade, to develop the hardware, and Alan McNeil to design and program the game.41
A native of Chicago, Alan McNeil attended the Chicago campus of the University of Illinois to study art and architecture but fell in with the crowd working with the university’s revolutionary PLATO educational time-sharing system and took a minor in computer science. After graduation in 1975, he spent a year as a PLATO research associate and then took a job with the Itty Bitty Machine Co., Chicago’s first microcomputer store.42 In 1977, he joined DNA, where he programmed Boot Hill, Sea Wolf II, and the Gunfight adaptation built into the Bally Professional Arcade.43 Bored working on extensions of other people’s projects, he asked Dave Nutting for the opportunity to create his own video game but was turned down because Dave thought he needed to acquire more experience first. He joined URL in 1979 upon the promise that once he worked on a pinball hardware, he could develop a video game.44
In designing Stern’s first video game, McNeil was inspired by a game written in BASIC called Chase that he had encountered as a type-in program in one of the early computer magazines. In this game, the player is deposited in a room with several hazardous obstacles scattered about and several robots that want to kill him. Each turn, the player moves one space, after which all the robots move along the shortest path to the player. If one of the robots touches the player, he dies, but if one of the robots collides with an obstacle or another robot, it is destroyed. Therefore, the player must carefully plan his moves to cause these collisions.
The developer of Chase is unknown, but it appears to have originated on the DTSS at Dartmouth.45 In about 1975 or 1976, a computer engineer working on a ballistic missile submarine program for the U.S. Navy named Bill Cotter visited Dartmouth, discovered the DTSS, and played the game.46 At the time, Cotter was looking for programs to help his co-workers feel more comfortable using their time-shared Honeywell 6,000 mainframe, so he ported Chase to run on the computer.47 He also submitted the program to Creative Computing, which featured it in the January–February 1976 issue.48 It subsequently appeared in Kilobaud in February 1977,49 Dr. Dobb’s Journal in a graphical version for S-100 systems in May 1977,50 and the book More BASIC Computer Games by David Ahl in 1979.51 In 1980, a variant called Escape! appeared in a book of TRS-80 programs that added a tank alongside the robots.52
When McNeil first saw Chase is not clear, but regardless, he decided a real-time version would make a great coin-operated video game.53 Once he implemented it, however, he discovered it was too difficult because the robots zeroed in on the player before he had a chance to force them to collide with each other. To even the odds, he gave the player a laser pistol to fight back, but the robots were still overwhelming. Finally, he created an algorithm to generate a series of connected randomly generated mazes for the players to navigate through. This inhibited the movement of the robots enough so that the player had a chance to kill them.54
While no two mazes in individual play sessions of Berzerk are alike, each one is created through a random number generator and a seed, so the player can return to previous rooms. To prevent the player from loitering in a cleared room, McNeil added an invincible bouncing smiley face that relentlessly chases the player until he moves on, a form chosen because he could not stand the ubiquitous yellow smiley face appearing on t-shirts and other paraphernalia at the time.55 Tony Miller named the face “Evil Otto” after the office manager at DNA, Dave Otto, who was infamous for enacting policies that grated on the engineering staff.56
One aspect that set McNeil’s game apart on its debut was the incorporation of speech. This feature was not originally planned but was added after a salesman tried to sell a new sound chip to URL originally intended for use in applications for the blind. The limited memory on the chip led to a robotic sounding voice that perfectly fit the theme of the game. The team recorded several nouns and verbs that could be paired together resulting in phrases like “Humanoids must not escape!” and “Chicken, Fight Like a Robot” if the player just ran from room to room without destroying anything. The speech chip was used to good effect in the game’s attract mode too, during which it would exclaim “Coin detected in pocket!”57
One aspect of the game that did not impress was its monochrome graphics. Stern opted not to go with color due to the expense, particularly since plenty of hit games had shipped in black and white. Once company executives saw Defender at the 1980 AMOA in October, they realized their mistake.58 It was too late to do a proper color generator because the game was so close to shipping, but the hardware engineers developed a color overlay system that could generate 16 colors but could only produce a single color within a four-by-four band of pixels. This meant individual sprites were limited to a single color, and if two objects of different colors got too close to each other the color of one object would bleed into the other, a phenomenon known as “color clash.”59
McNeil named his game Berzerk in honor of the Berserker series of science fiction novels by Fred Saberhagen that depict a struggle with an army of killer robots developed by a long extinct race.60 Released in November 1980, the game became a sizeable hit for Stern with sales of 15,000 units.61 It spent a few months as a top-five earning video game in early 1981 but was ultimately surpassed by another shooting game that Stern licensed from the Japanese company Konami.
***
Konami co-founder Kagemasa Kozuki was born in November 1940 in Kyoto and studied economics at Kansai University. Upon graduation in 1966, he took employment with the Osaka branch of Nippon Columbia as a salesman for the company’s jukeboxes. In March 1969, he established his own jukebox rental and repair business in conjunction with his co-worker, Tatuso Miyasako, who oversaw record supply at the Osaka branch, and Miyasako’s friend Yoshinobu Naka, who worked at a local record store. They named their company by combining the first syllable of each of their last names to spell “Konami.”62
In 1973, with the Japanese jukebox business in decline, Konami changed its business to manufacturing amusement machines. The firm incorporated as Konami Industry Company but lost Miyasako, who preferred to remain in the record business. In December 1975, two major Japanese coin-operated amusement operators, Maru Sansho Co. in Kobe and Kato Amusement Industry in Nagoya, jointly formed a company called Leijac to sell coin-operated games and sub-contracted Konami to manufacture its products. The company experienced its first big success with a roulette-style medal game called Piccadilly Circus and continued developing medal games into the early 1980s.63
As with so many other Japanese coin-op companies, Konami and Leijac entered the video game business by developing a series of Breakout clones, in this case Block Yard in 1977 and Destroyer and Super Destroyer in 1978, the latter of which incorporated a microprocessor. Space Invaders clone Space King and Gee Bee clone Rich Man followed in 1979 before the collapse of the Invader market seriously impacted Maru Sansho, causing it to sell its interest in Leijac to Konami in August 1979. This spurred Kato to follow suit, so the sales company became a subsidiary of Konami, which was now an independent manufacturer. The company began making original, yet still derivative products including a Space Invaders variant called Kamikaze and a Star Fire-like game called Star Ship in 1979 and a game simply titled Maze in 1980 that appears similar to Midway’s Amazing Maze.64
In early 1980, Konami became an official Namco licensee to manufacture and sell Galaxian. This not only benefitted the company financially in the short term, but also gave it access to the Galaxian hardware system, which was more sophisticated than anything Konami had used in its own games.65 The Konami development department under Shokichi Ishihara adapted the hardware for its own use and began work on a new shooting game called Scramble.
Nothing is known about the development of Scramble, but it appears to combine elements of the games Defender and Astro Fighter. Released by Data East in October 1979, Astro Fighter is a Space Invaders clone that introduced two innovations. First, the game divides the action into five individual stages. Each of the first four stages consists of a fight with a group of enemy ships. These four groups are not identical like the waves in Space Invaders or Galaxian, but instead vary in their look, number, and attack pattern. The last stage is a fight with a larger command ship that takes multiple hits to kill. The second innovation of the game is the incorporation of a fuel bar that serves as a timer. While the game still regulates play through lives, the player must also complete all five stages before the fuel bar runs out. Once the command ship is destroyed, the game starts over from the first stage on a higher difficulty level.
For Scramble, Konami appears to have borrowed the stage progression and the fuel bar from Astro Fighter and melded it with the new horizontally scrolling playfield of Defender.66 Scramble took this mechanic a step further by implementing forced scrolling so that the player’s ship hurtles through the game world. Another difference between Scramble and previous shooting games is that rather than the action taking place either in open space or high above the surface of a planet, it takes place directly above a mountainous terrain and within the narrow confines of an enemy base. As such, colliding with the walls, ceiling, or the ground destroys the player’s ship. The player also must contend with enemies both on the ground and in the air, so his ship has two modes of attack. The standard fire button shoots at objects in front of the player, while a second button launches missiles at the ground to destroy enemies and blow up tanks that replenish the fuel gauge. Once the player passes through all five stages, he must complete a brief sixth stage by destroying an object at the center of the enemy base. Then, as in Astro Fighter, the game starts over again at a higher level of difficulty.
Scramble debuted at the London Amusement Trades Exhibition in January 1981 and started shipping in Japan that March. It became an instant smash success in its home country, which caused serious issues for Konami because it was a small company with slight manufacturing capacity.67 Cloning began running rampant within months, much of it undertaken by the yakuza, and Konami ended up caught between competing clans as the drama unfolded.68 It also spawned more legitimate derivatives that adopted that adopted the game’s forced scrolling through multiple stages, but featured slightly different game play like Universal’s Cosmic Avenger and Vanguard from SNK. To combat the clones and derivatives, Konami rushed a sequel into production called Super Cobra that debuted just five months after Scramble. The new game replaced the player’s spaceship with a helicopter, doubled the number of stages, and added a few new enemies but otherwise it played the same as its predecessor. Because of the high number of stages, Super Cobra also introduced the capability for the player to continue the game right where he left off after losing all his lives by inserting another coin. To forestall clone makers, Konami entered a deal with Sega to have the larger company manufacture the game.69
In the United States, Konami licensed Scramble to Stern. The relationship between the two companies began in 1980 when a man named Barry Feinblatt, who ran an import-export company called Universal Affiliated International, showed some Konami games to Gary Stern just as his company was planning to enter the video game business.70 Kamikaze became the first video game Stern released in June 1980 under the name Astro Invader. It sold 5,000 units. Stern also manufactured a quirky Konami game called The End, a Space Invaders clone in which the bunkers protecting the player are composed of Breakout-style bricks that the enemy creatures steal to spell the word “end” at the top of the screen. When the word is completed, the game is over. The game was not a success.71
Stern began shipping Scramble in April 1981. Within two months, it was the top earning game in the country. Though its stay at the top was short, it moved over 15,000 units in less than a year. Stern licensed Super Cobra as well, which moved another 12,000 units after its release in July.72 Buoyed by its video game success, Stern’s revenues rose from $28 million in 1979 to $40 million in 1980 to a whopping $108 million in 1981.73
Stern was not the only video game manufacturer to experience such rapid financial growth, for in 1981, the entire industry took off like a rocket. After hitting $2.8 billion in 1980, coin drop nearly doubled to $4.9 billion in 1981. The number of units on location also skyrocketed from 541,000 to 1.1 million.74 The industry was not just huge, it was now the most popular location-based entertainment activity in the United States, with twice the revenue of all the Nevada casinos put together, nearly twice the domestic box office of Hollywood, and three times the earnings of Major League Baseball, the NFL, and the NBA combined.75 Defender, Berzerk, Scramble, and Super Cobra all played their role in this remarkable transformation of what just a decade before was still regarded by some as a shady business controlled by mobsters, but the most important product that brought video games well and truly into the mainstream was a simple maze game starring a yellow circle with a sliver removed.