What was the first video game?

In 1972, the first commercially available video game console, the Magnavox Odyssey, had a light gun accessory, the Shooting Gallery. This was the first involvement of Nintendo in video games. According to Martin Picard in the "International Journal of Computer Game Research": "in 1971, Nintendo had -- even before the marketing of the first home console in the United States -- an alliance with the American pioneer Magnavox to develop and produce optoelectronic guns for the Odyssey (released in 1972), since it was similar to what Nintendo was able to offer in the Japanese toy market in 1970s".

History of Nintendo

The history of Nintendo traces back to 1889, when it was founded to produce handmade hanafuda. is a Japanese multinational consumer electronics company headquartered in Kyoto, Japan. It eventually became one of the most prominent figures in today's video game industry, being the world's largest video game company by revenue.

Nintendo started out as a small Japanese company, founded by Fusajiro Yamauchi on September 23, 1889, as Nintendo Koppai. Based in Kyoto, Japan, the business produced and marketed "hanafuda". The name "Nintendo" is commonly assumed to mean "leave luck to heaven", but there are no historical records to validate this assumption. The cards, which were all handmade, soon began to gain in popularity, and Yamauchi had to hire assistants to mass-produce cards to keep up with the demand.

Fusajiro Yamauchi did not have a son to take over the family business. Following common Japanese tradition, he adopted his son-in-law, Sekiryo Yamauchi, (after the wife). In 1929, Yamauchi retired from the company and allowed Sekiryo Yamauchi to take over the company as president. In 1933, Sekiryo Yamauchi established a joint venture with another company and renamed the company Yamauchi Nintendo & Co.

In 1947, Sekiryo established a distribution company, Marufuku Co., Ltd., to distribute the hanafuda, as well as several other brands of cards that had been introduced by Nintendo. Sekiryo Yamauchi also had only daughters, so again his son-in-law (Shikanojo Inaba, renamed Shikanojo Yamauchi) was adopted into the family. Shikanojo never became president because he abandoned his family. Subsequently, his son Hiroshi was brought up by his grandparents. He later took over the company instead of his father.

In 1949, Hiroshi Yamauchi was attending Waseda University in Tokyo, however, after his grandfather died he left to take office as the president of Nintendo. In 1951, he renamed "Marufuku Co. Ltd." to "Nintendo Playing Card Co., Ltd." In 1953, Nintendo became the first company in Japan to produce playing cards from plastic.

In 1956, Yamauchi visited the U.S., to engage in talks with the United States Playing Card Company, the dominant playing card manufacturer in the United States. He was shocked to find that the world's biggest company in his business was relegated to using a small office. This was a turning point for Yamauchi, who then realized the limitations of the playing card business.

In 1959, Nintendo struck a deal with Disney to allow the use Disney's characters on Nintendo's playing cards. Previously, Western playing cards were regarded as something similar to hanafuda and mahjong: a device for gambling. By tying playing cards to Disney and selling books explaining the different games one could play with the cards, Nintendo could sell the product to Japanese households. The tie-in was a success and the company sold at least 600,000 card packs in a single year. Due to this success, in 1962, Yamauchi took Nintendo public, listing the company in Osaka Stock Exchange Second division.

Following the aforementioned success, in 1963 "Nintendo Playing Card Co., Ltd." was renamed to "Nintendo" by Yamauchi. Nintendo now began to experiment in other areas of business using the newly injected capital. During the period of time between 1963 and 1968, Nintendo set up a taxi company, "love hotel" chain, food company (trying to sell instant rice, similar to instant noodles) and several other things (including a vacuum cleaner, Chiritory, which later appeared in a two-player minigame in "" in 2003). All these ventures eventually failed, except toymaking, where they had some earlier experience from selling playing cards. In 1964, while Japan was experiencing an economic boom due to the Tokyo Olympics, the playing card business reached its saturation point. Japanese households stopped buying playing cards, and the price of Nintendo stock fell from 900 yen to 60 yen.

In 1965, Nintendo hired Gunpei Yokoi as a maintenance engineer for the assembly line. However, Yokoi soon became famous for much more than his ability to repair conveyor belts.

Nintendo struggled to survive in the Japanese toy industry; it was still small at this point, and dominated by already well-established companies such as Bandai and Tomy. Because of the generally short product life cycle of toys, the company always had to come up with new products. This was the beginning of a major new era for Nintendo.

In 1966, Yamauchi was observing a hanafuda factory. He noticed an extending arm, which was made by one of their maintenance engineers, Gunpei Yokoi, for his own amusement. Yamauchi ordered Yokoi to develop it as a proper product for the Christmas rush. Released as the "Ultra Hand", it would become one of Nintendo's earliest toy blockbusters, selling over a million units. Seeing that Yokoi had promise, Yamauchi pulled him off assembly line work. Yokoi was soon moved from maintenance duty to product development.

Due to his electrical engineering background, it soon become apparent that Yokoi was quite adept at developing electronic toys. These devices had a much higher novelty value than traditional toys, allowing Nintendo to charge a higher price margin for each product. Yokoi went on to develop many other toys, including the Ten Billion Barrel puzzle, a baseball throwing machine called the Ultra Machine, and a Love Tester. Another invention of his, in collaboration with Masayuki Uemura from Sharp, was the Nintendo Beam Gun Game, the precursor to the NES Zapper (which was used in games like Duck Hunt.).

Nintendo released the first solar-powered light gun, the Nintendo Beam Gun, in 1970; this was the first commercially available light-gun for home use, produced in partnership with Sharp.

In 1972, Nintendo released the Ele-Conga, one of the first programmable drum machines. It could play pre-programmed rhythms from disc-shaped punch cards, which could be altered or programmed by the user, to play different patterns.

In 1973, its focus shifted to family entertainment venues with the Laser Clay Shooting System, using the same light gun technology used in Nintendo's "Kousenjuu" series of toys, and set up in abandoned bowling alleys. Following some success, Nintendo developed several more light gun machines for the emerging arcade scene. While the Laser Clay Shooting System ranges had to be shut down following excessive costs, Nintendo had found a new market.

In 1974, Nintendo secured the rights to distribute the Magnavox Odyssey video game console in Japan.

Nintendo at this time saw how successful video games were and began to dabble in them. Their first step in that field was to secure the rights to distribute the Magnavox Odyssey in Japan in 1975. At the time, home video game consoles were extremely rare—even the seminal Atari Pong console had yet to be produced. After experiencing reasonable success at this, Nintendo began developing its own video games, both for home and for arcades. In the 1970s, Mitsubishi Electric proposed joint development of "Color TV Game Machine". In 1977, they released "Color TV Game 6" and "Color TV Game 15" (6 and 15 indicates the number of games).

Their first video arcade game was 1975's "EVR Race"; a handful of others followed in the next several years, "Radar Scope" and "Donkey Kong" being among the most famous of these. The early 1980s saw Nintendo's video game division (led by Yokoi) creating some of its most famous arcade titles. The massively popular "Donkey Kong" was created in 1981, with Shigeru Miyamoto as its mastermind, and released in the arcades and on the Atari 2600, Intellivision, and ColecoVision video game systems (although Nintendo themselves generally had no involvement with these early console ports). This release method would be used on several later Nintendo arcade games of this same period, including the original "Mario Bros." (not to be confused with the later "Super Mario Bros.") In addition to this arcade and dedicated console game activity, Nintendo was testing the consumer handheld video game waters with the Game & Watch.

Game & Watch or G&W is a line of handheld electronic games produced by Nintendo from 1980 to 1991. Created by game designer Gunpei Yokoi, each Game & Watch features a single game to be played on an LCD screen in addition to a clock and/or an alarm. It was the earliest Nintendo product to garner major success, with 43.4 million units sold worldwide.

In 1982, Nintendo developed a prototype system dubbed the "Advanced Video System" (or AVS for short) and had controllers much like the NES. There were accessories such as a tape drive, a joystick and a lightgun, and along with all of that, the system was made of a computer, much like the Atari 400, Commodore Vic-20 and Commodore 64. It was never released and is on display at the Nintendo World Store in New York. In July 1983, Nintendo released the "Famicom" ("Family Computer") system in Japan, which was its first attempt at a cartridge-based video game console. The system sold over 500,000 units within two months at a price around $100 USD. However, after a few months of favorable sales, Nintendo received complaints that some Famicom consoles would freeze when the player attempted to play certain games. The fault was found in a malfunctioning chip and Nintendo decided to recall all Famicom units that were currently on store shelves, which ultimately cost them approximately half a million USD.

During this period, Nintendo rekindled their desire to release the Famicom (Or Nintendo Entertainment System) in the US. Since the company had very little experience with the US market, they had previously attempted to contract with Atari for the system's distribution in 1983. However, a fiasco involving Coleco and "Donkey Kong" soured the relationship between the two during the negotiations, and Atari refused to back Nintendo's console.

In 1983-1985, a large scale recession in video game sales hit the market which amounted to a 97% decrease primarily in the North American area. The recession known as the "video game crash of 1983" was caused by a few main factors including the flooding of the console market, competition of home computers, inflation, and loss of publishing control. The video game crash of 1983 soon took out not only Atari, but the vast majority of the American market itself. Over time, dominance in the market shifted from America to Japan. Nintendo began exporting to America and had virtually only one major competitor in the market, Sega, which was another Japanese company.

Nintendo was determined not to make the same mistakes in the US that Atari had. Because of massive influxes of games that were regarded as some of the worst ever created, gaming had almost completely died out in America. Nintendo decided that to avoid facing the same problems, they would only allow games that received their "Seal of Quality" to be sold for the Famicom.

In 1985, Nintendo announced that they were releasing the Famicom worldwide with a different design under the name the "Nintendo Entertainment System" (NES). They used a creative tactic to counter the bad view that the media was giving on video games, and released the NES with R.O.B. units that connected to the console and were synchronised to the games. To ensure the localization of the highest-quality games by third-party developers, Nintendo of America limited the number of game titles third-party developers could release in a single year to five. Konami, the first third-party company that was allowed to make cartridges for the Famicom, would later circumvent this rule by creating a spinoff company, Ultra Games, to release additional games in a single year. Other manufacturers soon employed the same tactic. Also in 1985, "Super Mario Bros." was released for the Famicom in Japan and became a large success.

Nintendo test marketed the Nintendo Entertainment System in the New York area on October 18, 1985. They expanded the test to Los Angeles in February 1986, followed by tests in Chicago and San Francisco. They would go national by the end of 1986, along with 15 games, sold separately. In the US and Canada, it outsold its competitors by a wide margin. This was also the year that "Metroid" and "" (the Japanese version) were released. In 1987, "The Legend of Zelda" was released to much critical acclaim.

In 1988, Nintendo of America unveiled "Nintendo Power", a monthly news and strategy magazine from Nintendo that served to advertise new games. The first issue published was the July/August edition, which spotlighted the NES game "Super Mario Bros. 2". "Nintendo Power" has since ceased publication with its December 2012 edition.

In 1989, Nintendo (which had seen a large amount of success from the Game & Watch) released the Game Boy (both created by Gunpei Yokoi), along with the accompanying game "Tetris". Due to the price, the game and its durability (unlike the prior Microvision from Milton Bradley Company, which was prone to static and screen rot), the Game Boy line sold extremely well, eventually amassing sales of 118 million units. Later, "Super Mario Land" was also released for the Game Boy, which sold 14 million copies worldwide. 1989 was also the year that Nintendo announced a sequel to the Famicom, to be called the Super Famicom.

The last major first-party game for the NES, "Super Mario Bros. 3", was released in early 1990, and went on to sell over 18 million units. It was followed by a licensed television adaption named The Super Mario Bros. Super Show!, which was released by DIC Entertainment and Viacom Enterprises in that year to capitalise on the game's immense popularity.

The Super Famicom was released in Japan on November 21, 1990. The system's launch was widely successful, and the Super Famicom was sold out across Japan within three days, selling 1.6 million units by June 1991. In August 1991, the Super Famicom was launched in the US under the name ""Super Nintendo Entertainment System"" (SNES), followed by Europe in 1992.

The Super Nintendo Entertainment System followed in the steps of its predecessor, with high technical specifications for its era. The controller of the SNES had also improved over that of the NES, as it now had rounded edges and four new buttons, a standard which is evident on many modern controllers today.

Nintendo had also begun development on a CD-ROM attachment for the SNES/Super Famicom. Their first partner in this project was Sony, whom Nintendo had worked with before to provide the SNES with its SPC sound chip. Development on the "Nintendo PlayStation" CD-ROM add-on and SNES/SFC standalone hybrid console began. However, at the last minute Nintendo decided to pull out of the partnership and instead go with Philips, and while no CD-ROM add-on was produced, several Nintendo properties (namely The Legend of Zelda) appeared on the Philips CD-i media console. Upon learning this, Sony decided to continue developing the technology they had into the PlayStation. The exact reason Nintendo left its partnership with Sony has been the subject of speculation over the years, but the most common theory is that Sony either wanted too much of the profits for the machine or the rights to the CD-ROM attachment itself.

In Japan, the Super Famicom easily took control of the gaming market. In the US, due to a late start and an aggressive marketing campaign by Sega (Headed by the Sega Company's new mascot, Sonic The Hedgehog, their answer to Nintendo's Super Mario), Nintendo saw its market share take a precipitous plunge from 90-95% with the NES to a low of approximately 35% against the Sega Genesis. Over the course of several years, the SNES in North America eventually overtook the Genesis, thanks to franchise titles such as "Super Mario World", "", "Street Fighter II", and the "Final Fantasy" series. Total worldwide sales of the SNES reached 49.10 million units, eclipsing the estimated 40 million unit sales of the Genesis.

As the SNES battled the Sega Genesis, Nintendo was running into problems on another front caused by their own aggressive marketing behavior. In 1991, Nintendo agreed to a settlement regarding price-fixing allegations brought by the Federal Trade Commission and attorneys general in New York and Maryland. Nintendo had been accused of threatening to cut off shipments of the NES to retailers who discounted the price of the system. The estimated cost of the settlement was just under $30 million.

In 1992, Gunpei Yokoi and the rest of R&D 1 began planning on a new virtual reality console to be called the Virtual Boy. Hiroshi Yamauchi also bought majority shares of the Seattle Mariners in 1992. By May 1993, Nintendo had reportedly become one of the top ten leading companies in the world.

In 1993, Nintendo announced plans to develop a new 64-bit console codenamed "Project Reality" that would be capable of rendering fully 3D environments and characters. In 1994, Nintendo also claimed that Project Reality would be renamed "Ultra 64" in the US. The "Ultra 64" moniker was unveiled in arcades on the Nintendo branded fighting game "Killer Instinct" and the racing game "Cruisin' USA". "Killer Instinct" was later released on the SNES. Soon after, Nintendo realized they had mistakenly chosen a name for their new console that the Konami corporation owned the rights to. Specifically, only Konami would have the rights to release games for the new system called "Ultra Football", "Ultra Tennis", etc. Therefore, in 1995 Nintendo changed the final name of the system to the "Nintendo 64", and announced that it would be released in 1996. They later showed previews of the system and several games, including "Super Mario 64", to the media and public. 1995 is also the year that Nintendo purchased part of Rare.

In 1994, after many years of Nintendo's products being distributed in Australia by Mattel since the NES in 1985, Nintendo opened its Australian headquarters and its first Managing Directors were Graham Kerry, who moved along from Mattel Australia as Managing Director and Susumu Tanaka of Nintendo UK Ltd.

In 1995, Nintendo released the Virtual Boy in Japan. The console sold poorly, but Nintendo still said they had hope for it and continued to release several other games and attempted a release in the US, which was another disaster.

Also in 1995, Nintendo found themselves in a competitive situation. Competitor Sega introduced their 32-bit Saturn, while newcomer Sony introduced the 32-bit PlayStation. Sony's fierce marketing campaigns ensued, and it started to cut into Nintendo and Sega's market share.

On June 23, 1996, the Nintendo 64 (N64) was released in Japan, selling over 500,000 units on the first day of its release. On September 29, 1996, Nintendo released the Nintendo 64 in North America, selling out the initial shipment of 350,000. Many feel that the advertising onslaught by Sony at this time did not truly begin to take effect until many of the consumers who held out for the N64 became frustrated at the lack of software following the first few months after the system's release. What also greatly contributed to the extremely competitive climate that Nintendo was entrenched in was the fact that many third-party companies immediately began developing and releasing many of their leading games for Nintendo's competing consoles. Many of those third party companies cited cheaper development and manufacturing costs for the CD format, versus the cartridge format. On December 1, 1999, Nintendo released an add-on to the Nintendo 64 in Japan, titled the Nintendo 64DD, although it was never released elsewhere.

Nintendo followed with the release of the Game Boy Pocket, a smaller version of the original Game Boy, designed by Gunpei Yokoi as a parting gift. A week after the release of the Game Boy Pocket, Gunpei resigned from his position at Nintendo. Gunpei helped in the creation of a competitor system named the WonderSwan, using the skills he gained in the creation of the Game Boy.

In 1996, "Pocket Monsters" (known internationally as "Pokémon") was released in Japan to a huge following. The "Pokémon" franchise, created by Satoshi Tajiri, was proving so popular in America, Europe, and Japan, that for a brief time, Nintendo took back their place as the supreme power in the games industry.

In 1997, Game Boy and Metroid creator Gunpei Yokoi died in a car accident at the age of 56.

On October 13, 1998, the "Game Boy Color" was released in Japan, with releases in North America and Europe a month later.

Nintendo released the Game Boy Advance in Japan on March 21, 2001, followed by the North American launch on June 11 and the European launch on June 22.

Nintendo released the GameCube home video game console on September 14, 2001, in Japan. It was released in North America on November 18, 2001, Europe on May 3, 2002, and Australia on May 17, 2002.

In January 2002, Minoru Arakawa resigned as president of Nintendo of America, and Nintendo named Tatsumi Kimishima as his successor.

In May 2002, Hiroshi Yamauchi stepped down as the president of Nintendo and named Satoru Iwata his successor.

During the same year, Nintendo and Chinese-American scientist Dr Wei Yen co-founded iQue to manufacture and distribute official Nintendo consoles and games for the mainland Chinese market under the iQue brand. Nintendo's aggressive business tactics in Europe would catch up to them. The European Commission determined that Nintendo had engaged in anticompetitive price-fixing business practices dating at least as far back as the early 1990s. This resulted in a heavy fine being laid against the company — €149 million, one of the largest antitrust fines applied in the history of the commission.

In May 2004, Nintendo announced plans to release a new brand of handheld, unrelated to the Game Boy, featuring two screens, one of which was touch-sensitive. The Nintendo DS, released on November 21, 2004, received over three million pre-orders. In addition to the touch screen, the DS can also create three-dimensional graphics, similar to those of the Nintendo 64, although its lack of hardware support for texture filtering results in more pixelated graphics than on the Nintendo 64.

President Satoru Iwata reassigned all of Nintendo's software designers under new managers and different division; most of the resources were allocated to Shigeru Miyamoto and Takashi Tezuka and the Nintendo EAD division.

On May 14, 2005, Nintendo opened its first retail store accessible to the general public, Nintendo World Store, at the Rockefeller Center in New York City. It consists of two stories, and contains many kiosks of GameCube, Game Boy Advance, and Nintendo DS games. There are also display cases filled with things from Nintendo's past, including Hanafuda, Nintendo's first product. They celebrated the opening with a block party at Rockefeller Plaza.

At E3 in May 2005, Nintendo displayed the first prototype for their "next-generation" system, codenamed the Nintendo Revolution (now known as the Wii), its controller revealed at the Tokyo Game Show later that year.

On January 26, 2006, Nintendo announced a new version of their Nintendo DS handheld, the Nintendo DS Lite, designed to be smaller and lighter, with a brighter screen. It was launched in Japan on March 2, 2006, and three months later in North America and Europe on June 11 and June 23, 2006, respectively.

On May 25, 2006, Reggie Fils-Aimé was promoted to President and COO of Nintendo of America, Inc. The former President, Tatsumi Kimishima, was promoted to Chairman of the Board and CEO.

On July 7, 2006, Nintendo officially established a South Korean subsidiary, Nintendo Korea, in the country's capital, Seoul, which replaced Daewon Media as the official distributor of Nintendo products in South Korea.

In early August 2006, it was revealed that Nintendo, along with Microsoft, was made the target of a patent-infringement lawsuit. Leveled by the Anascape Ltd., the suit claimed that Nintendo's use of analog technology in their game controllers constitutes a violation of their patents. The lawsuit sought to recover damages from both corporations and possibly force them to stop selling controllers with the violating technology. Microsoft settled with Anasacape, while Nintendo went to trial, initially losing and being ordered to pay US$21 million in damages. Nintendo appealed, and on April 23, 2010 the Federal Circuit reversed the ruling. In November 2010, Anascape's appeal to the Supreme Court of the United States was denied.

In mid-September 2006, during press conferences held in Tokyo, New York, and London on 13, 14 and 15 September, respectively, Nintendo announced launch details for its Wii console, as well as demonstrated features of the "Wii Menu" GUI.
The system was first released on November 19, 2006 in the US, followed by the Japanese launch on December 2, the Australian launch on December 6, and the European launch on December 8.

The console sold fast and was a big breakthrough for Nintendo, picking up the pace lost from their last console, the GameCube. The success of the Wii has been attributed to the intended market of the product; while at the time most competitors were focusing on more adult and fan-based games, Nintendo decided to release a console for a larger demographic, one including casual gamers, children and those who wouldn't ordinarily play video games.
Since no other major gaming console was marketing for this image, these other companies were caught mostly unprepared by the success of the Wii system, and it wasn't until 2010 that Sony and Microsoft released consoles targeting the same demographic as the Wii.

On September 17, 2007, Nintendo of America closed its official forums, the NSider Forums, indefinitely due to a major overhaul of their site. For months prior, cutbacks in Nintendo of America's online department led to the trimming back of NSider's chat hours and the replacement of their annual Camp Hyrule event — held during August — with a sweepstakes. In the meantime, Nintendo encouraged fans to run their own forums. Nintendo-Europe's forum section of their site was also officially closed down a week later due to a site revamp, however it had been offline citing "security issues" since June of that year. On December 19, 2007, Nintendo opened a forum for technical support only.

In October 2007, Nintendo announced Nintendo Australia's new Managing Director, Rose Lappin. She is Nintendo's first female head of one of its subsidiaries and worked for Nintendo before it started in Australia as Director of Sales and Marketing for Mattel and had that role until she was announced Managing Director.

On November 1, 2008, Nintendo released an updated version of the Nintendo DS Lite in Japan; the Nintendo DSi. It includes all features of the Nintendo DS Lite, but it includes a camera on the inside and outside of the system, and newer features. It is the first handheld game system manufactured by Nintendo that allows downloadable gaming content to the system. The Nintendo DSi was released April 2, 2009, in Australia and Asia, April 3, 2009, in Europe, and April 5, 2009, in North America.

On February 26, 2011, the Nintendo 3DS was released in Japan. It was released on March 25 and 27 to Europe and the US, respectively. The 3DS was part of a large wave of 3D technologies being released at the time; unlike most of these, the 3DS did not use 3D glasses for its 3D effect, and instead used parallax barrier autostereoscopy.

On April 25, 2011, Nintendo confirmed that they were making a new console to be released in 2012. On June 7, 2011, the console was announced as being named the Wii U. The Wii U is Nintendo's first console to be able to play video games in 1080p HD. During the Electronics Entertainment Expo in 2011, Nintendo's press conference put a great amount of stress on the abilities and innovations of the new controller, a unit resembling a tablet.

Many gamers were confused after the press conference about whether the Wii U is an entirely new system or just a new controller for the Wii. The Wii U was, however, a whole new home console system developed by Nintendo. The system was released on November 18, 2012 in North America, November 30, 2012 in Europe and Australia, and on December 8, 2012 in Japan. It featured a new controller with a 6.2 inch touchscreen, two thumb pads, four shoulder buttons, a directional pad, and four lettered buttons. It also featured an accelerometer, gyroscope, camera, Near-field communications (NFC), and built-in microphone, similar those in the Nintendo 3DS.

On July 11, 2015, Satoru Iwata died from a bile duct tumor at the age of 55. Following his death, Shigeru Miyamoto and Genyo Takeda jointly led the company on an interim basis until Tatsumi Kimishima's appointment as Iwata's successor on September 16, 2015. In addition to the appointment, Miyamoto was named "Creative Fellow" while Takeda was named "Technology Fellow".

In October 2016, Nintendo revealed a new system called the Nintendo Switch, which was released on March 3, 2017. It is a hybrid video game console with detachable controllers with an emphasis on portability and on the go multiplayer in contrast of the then competitors PlayStation 4 and Xbox One. In the year the Switch was released Nintendo put out "The Legend of Zelda: Breath of the Wild" and "Super Mario Odyssey", both games with critical acclaim that helped sell millions of units in the first year of the new console, eventually culminating with the "Legend of Zelda: Breath of the Wild" being named Game of the Year 2017.

The history of video games spans a period of time between the invention of the first electronic games and today, covering a long period of invention and changes. Video gaming reached mainstream popularity in the 1970s and 1980s, when arcade video games, gaming consoles and home computer games were introduced to the general public. Since then, video gaming has become a popular form of entertainment and a part of modern culture in most parts of the world. The early history of video games, therefore, covers the period of time between the first interactive electronic game with an electronic display in 1947, the first true video games in the early 1950s, and the rise of early arcade video games in the 1970s ("Pong" and the beginning of the first generation of video game consoles with the Magnavox Odyssey, both in 1972). During this time there were a wide range of devices and inventions corresponding with large advances in computing technology, and the actual first video game is dependent on the definition of "video game" used.

Early history of video games

Following the 1947 invention of the cathode-ray tube amusement device, the earliest known interactive electronic game as well as the first to use an electronic display, the first true video games were created in the early 1950s. Initially created as technology demonstrations, such as the "Bertie the Brain" and Nimrod computers in 1950 and 1951, video games also became the purview of academic research. A series of games, generally simulating real-world board games, were created at various research institutions to explore programming, human–computer interaction, and computer algorithms. These include "OXO" and Christopher Strachey's draughts program in 1952, the first software-based games to incorporate a CRT display, and several chess and checkers programs. Possibly the first video game created simply for entertainment was 1958's "Tennis for Two", featuring moving graphics on an oscilloscope. As computing technology improved over time, computers became smaller and faster, and the ability to work on them was opened up to university employees and undergraduate students by the end of the 1950s. These new programmers began to create games for non-academic purposes, leading up to the 1962 release of "Spacewar!" as one of the earliest known digital computer games to be available outside a single research institute.

Throughout the rest of the 1960s, digital computer games were created by increasingly numerous programmers and sometimes sold commercially in catalogs. As the audience for video games expanded to more than a few dozen research institutions with the falling cost of computers, and programming languages that would run on multiple types of computers were created, a wider variety of games began to be developed. Video games transitioned into a new era in the early 1970s with the launch of the commercial video game industry in 1971 with the display of the coin-operated arcade game "Galaxy Game" and the release of the first arcade video game "Computer Space", and then in 1972 with the release of the immensely successful arcade game "Pong" and the first home video game console, the Magnavox Odyssey, which launched the first generation of video game consoles.

The term "video game" has evolved over the decades from a purely technical definition to a general concept defining a new class of interactive entertainment. Technically, for a product to be a video game under early definitions, there must be a video signal transmitted to a cathode ray tube (CRT) that creates a rasterized image on a screen. This definition would preclude early computer games that outputted results to a printer or teletype rather than a display, any game rendered on a vector-scan monitor, any game played on a modern high definition display, and most handheld game systems. From a technical standpoint, these would more properly be called "electronic games" or "computer games".

Today the term "video game" has completely shed its purely technical definition and encompasses a wider range of technology. While still rather ill-defined, the term "video game" now generally encompasses any game played on hardware built with electronic logic circuits that incorporates an element of interactivity and outputs the results of the player's actions to a display. Going by this broader definition, the first video games appeared in the early 1950s; they were tied largely to research projects at universities and large corporations, though, and had little influence on each other due to their primary purpose as academic and promotional devices rather than entertainment games.

The ancestors to these games include the cathode-ray tube amusement device, the earliest known interactive electronic game as well as the first to incorporate a cathode ray tube screen. The player simulates an artillery shell trajectory on a CRT screen connected to an oscilloscope, with a set of knobs and switches. The device uses purely analog electronics and does not use any digital computer or memory device or execute a program. It was patented by Thomas T. Goldsmith, Jr. and Estle Ray Mann in 1947. While the idea behind the game was potentially to use a television set as the display and thus sell the invention to consumers, as Goldsmith and Mann worked at television designer DuMont Laboratories, the patent, the first for an electronic game, was never used and the device never manufactured beyond the original handmade prototypes. This, along with the lack of electronic logic circuits, keeps the device from being considered the first video game. Around the same time as the device was invented, the earliest known written computer game was developed by Alan Turing and David Champernowne in 1948, a chess simulation called Turochamp, though it was never actually implemented on a computer as the code was too complicated to run on the machines of the time. Turing tested the code in a game in 1952 where he mimicked the operation of the code in a real chess game against an opponent, but was never able to run the program on a computer.

The earliest known publicly demonstrated electronic game was created in 1950. "Bertie the Brain" was an arcade game of tic-tac-toe, built by Josef Kates for the 1950 Canadian National Exhibition. To showcase his new miniature vacuum tube, the additron tube, he designed a specialized computer to use it, which he built with the assistance of engineers from Rogers Majestic. The large metal computer, which was four meters tall, could only play tic-tac-toe on a lightbulb-backed display, and was installed in the Engineering Building at the Canadian National Exhibition from August 25 to September 9, 1950. The game was a success at the two-week exhibition, with attendees lining up to play it as Kates adjusted the difficulty up and down for players. After the exhibition, "Bertie" was dismantled, and "largely forgotten" as a novelty. Kates has said that he was working on so many projects at the same time that he had no energy to spare for preserving it, despite its significance.

Nearly a year later on May 5, 1951, the Nimrod computer—created by engineering firm and nascent computer developer Ferranti—was presented at the Festival of Britain, and then showcased for three weeks in October at the Berlin Industrial Show before being dismantled. Using a panel of lights for its display, it was designed exclusively to play the game of Nim; moves were made by players pressing buttons which corresponded with the lights. Nimrod could play either the traditional or "reverse" form of the game. The machine was twelve feet wide, nine feet deep, and five feet tall. It was based on an earlier Nim-playing machine, "Nimatron", designed by Edward Condon and built by Westinghouse Electric in 1940 for display at the New York World's Fair. "Nimatron" had been constructed from electromechanical relays and weighed over a ton. The Nimrod was primarily intended to showcase Ferranti's computer design and programming skills rather than entertain, and was not followed up by any future games. Despite this, most of the onlookers at the Festival of Britain were more interested in playing the game than in the programming and engineering logic behind it.
Around this time, non-visual games were being developed at various research computer laboratories; for example, Christopher Strachey developed a simulation of the game draughts, or checkers, for the Pilot ACE that he unsuccessfully attempted to run for the first time in July 1951 at the British National Physical Laboratory and completed in 1952; this is the first known computer game to be created for a general-purpose computer, rather than a machine specifically made for the game like "Bertie". Strachey's program inspired Arthur Samuel to develop his own checkers game in 1952 for the IBM 701; successive iterations developed rudimentary artificial intelligence by 1955 and a version was shown on television in 1956. Also in 1951, Dietrich Prinz wrote the first limited program of chess for the University of Manchester's general-purpose Ferranti Mark 1 computer, one of the first commercially available computers. The program was only capable of computing "mate-in-two" problems as it was not powerful enough to play a full game, and it had no video output. Around the same time in the early 1950s, the RAND Corporation developed a series of combat simulation games of increasing complexity, where the player would enter orders to intercept enemy aircraft, or set up their forces to counter an enemy army invasion. These simulations were not yet true video games, as they required human intervention to interpret the player's orders and the final results; the computer only controlled the paths that the enemies would take.

In 1952, Alexander S. Douglas created "OXO", a software program for the Electronic Delay Storage Automatic Calculator (EDSAC) computer, which simulates a game of tic-tac-toe. The EDSAC was one of the first stored-program computers, with memory that could be read from or written to, and filled an entire room; it included three 35×16 dot matrix cathode ray tubes to graphically display the state of the computer's memory. As a part of a thesis on human–computer interaction, Douglas used one of these screens to portray other information to the user; he chose to do so via displaying the current state of a game. The player entered input using a rotary telephone controller, selecting which of the nine squares on the board they wished to move next. Their move would appear on the screen, and then the computer's move would follow. The game was not available to the general public, and was only available to be played in the University of Cambridge's Mathematical Laboratory, by special permission, as the EDSAC could not be moved. Like other early video games, after serving Douglas's purpose, the game was discarded. Around the same time, Strachey expanded his draughts program for another mainframe computer, the Manchester Mark 1, culminating in a version for the Ferranti Mark 1 in 1952, which had a CRT display. Like "OXO", the display was mostly static, updating only when a move was made. "OXO" and Strachey's draughts program are the earliest known games to display visuals on an electronic screen.

The first known game incorporating graphics that updated in real time, rather than only when the player made a move, was a pool game programmed by William Brown and Ted Lewis specifically for a demonstration of the University of Michigan-developed MIDSAC computer at the University of Michigan in 1954. The game, developed over six months by the pair, featured a pool stick controlled by a joystick and a knob, and a full rack of 15 balls on a table seen in an overhead view. The computer calculated the movements of the balls as they collided and moved around the table, disappearing when they reached a pocket, and updated the graphics continuously, forty times a second, so as to show real-time motion. Like previous video games, the pool game was intended primarily to showcase the computing power of the MIDSAC computer.
While further games like checkers and chess were developed on research computers, the next milestone in video games came in 1958 with "Tennis for Two". Perhaps the first game created solely for entertainment rather than as a technology demonstration or a research tool, the program simulated a game of tennis. Created by American physicist William Higinbotham for visitors at the Brookhaven National Laboratory to be more entertaining for visitors on their public day than the usual static exhibits about nuclear power, the game ran on a Donner Model 30 analog computer and displayed a side view of a tennis court on an oscilloscope. The players controlled the angle of their shots with attached controllers, and the game calculated and simulated the trajectory of the ball, including the possibility of hitting the net. The game was first shown on October 18, 1958. Hundreds of visitors lined up to play the new game during its debut. Due to the game's popularity, an upgraded version was shown the following year, with enhancements including a larger screen and different levels of simulated gravity. Afterwards, having served its purpose, the game was dismantled for its component parts. While the game had no innovations in game design or technological development, its status as an entertainment-focused game, rather than an academic project or technological showpiece, has led it to be considered one of the first "real" video games as they are generally thought of today.

Over the next few years, during 1957–61, various computer games continued to be created in the context of academic computer and programming research, particularly as computer technology improved to include smaller, transistor-based computers on which programs could be created and run in real time, rather than operations run in batches. A few programs, however, while used to showcase the power of the computer they ran on were also intended as entertainment products; these were generally created by undergraduate students, such as at the Massachusetts Institute of Technology where they were allowed on occasion to develop programs for the TX-0 experimental computer. These interactive graphical games were created by a community of programmers, many of them students affiliated with the Tech Model Railroad Club (TMRC) led by Alan Kotok, Peter Samson, and Bob Saunders. The games included "Tic-Tac-Toe", which used a light pen to play a simple game of noughts and crosses against the computer, and "Mouse in the Maze". "Mouse in the Maze" allowed users to use a light pen to set up a maze of walls on the monitor, and spots that represented bits of cheese or glasses of martini. A virtual mouse was then released and would traverse the maze to find the objects. Additionally, the wargame simulations from the early 1950s by the RAND Corporation had expanded into more complicated simulations which required little human intervention, and had also sparked the creation of business management simulation games such as "The Management Game", which was used in business schools such as at Carnegie Mellon University by 1958. By 1961, there were over 89 different business simulation games in use, with various graphical capabilities. As the decade ended, despite several video games having been developed, there was no such thing as a commercial video game industry; almost all games had been developed on or as a single machine for specific purposes, and the few simulation games were neither commercial nor for entertainment.

By 1961, MIT had acquired the DEC PDP-1 minicomputer, the successor to the TX-0, which also used a vector display system. The system's comparatively small size and processing speed meant that, like with the TX-0, the university allowed its undergraduate students and employees to write programs for the computer which were not directly academically related whenever it was not in use. In 1961-62, Harvard and MIT employees Martin Graetz, Steve Russell, and Wayne Wiitanen created the game "Spacewar!" on the PDP-1, inspired by science fiction books such as the "Lensman" series. The game was copied to several of the early minicomputer installations in American academic institutions, making it potentially the first video game to be available outside a single research institute.

The two-player game has the players engaged in a dogfight between two spaceships set against the backdrop of a randomly generated background starfield. The game was developed to meet three precepts: to use as much of the computer's resources as possible, to be consistently interesting and therefore have every run be different, and to be entertaining and therefore a game. The game was a multiplayer game because the computer had no resources left over to handle controlling the other ship. After the game's initial development, members of the TMRC worked to improve the game, adding an accurate starfield and a gravitational body, and spread it to the couple dozen other institutions with a PDP-1, a process which continued over the next few years. As the computer was uncomfortable to use for extended periods of time, Kotok and Saunders created a detached control device, essentially an early gamepad. "Spacewar" was reportedly used as a smoke test by DEC technicians on new PDP-1 systems before shipping, since it was the only available program that exercised every aspect of the hardware. Although the game was widespread for the era, it was still very limited in its direct reach: the PDP-1 was priced at US$120,000 and only 55 were ever sold, many without a monitor, which prohibited "Spacewar" or any game of the time from reaching beyond a narrow, academic audience. Russell has been quoted as saying that the aspect of the game that he was most pleased with was the number of other programmers it inspired to write their own games.
Although the market for commercial games—and software in general—was small, due to the cost of computers limiting their spread to research institutions and large corporations, several were still created by programmers and distributed by the computer manufacturers. A number of games could be found in an April 1962 IBM program catalog. These included board games, "BBC Vik The Baseball Demonstrator", and "Three Dimensional Tic-Tack-Toe". Following the spread of "Spacewar", further computer games developed by programmers at universities were also developed and distributed over the next few years. These included the Socratic System, a question and answer game designed to teach medical students how to diagnose patients by Wallace Feurzeig in 1962, and a dice game by Edward Steinberger in 1965. Mainframe games were developed outside of the IBM and DEC communities as well, such as the 1962 Polish "Marienbad" for the Odra 1003.

The creation of general programming languages like BASIC, which could be run on different hardware types, allowed for programs to be written for more than one specific computer, in turn letting games written in them to spread to more end players in the programming community than before. These games included a baseball simulation game written in BASIC by John Kemeny in 1965; a BASIC bingo game by Larry Bethurum in 1966; a basketball simulation game written in BASIC by Charles R. Bacheller in May 1967; another baseball game that simulates the 1967 World Series written in BASIC by Jacob Bergmann in August 1967; "Space Travel", written by Ken Thompson for a Multics system in 1969 and which led in part to the development of the Unix operating system; and "Hamurabi", a text-based FOCAL game written by Doug Dyment in 1968 and converted to BASIC by David H. Ahl in 1969, and one of the first strategy video games ever made. "Hamurabi" and "Space Travel" were among several early mainframe games that were written during the time, and spread beyond their initial mainframe computers to general-purpose languages like BASIC.
At the beginning of the 1970s, video games existed almost entirely as novelties passed around by programmers and technicians with access to computers, primarily at research institutions and large companies. The history of video games transitioned into a new era early in the decade, however, with the rise of the commercial video game industry. In 1971, Bill Pitts and Hugh Tuck developed a coin-operated computer game, "Galaxy Game", at Stanford University using a DEC PDP-11 computer with vector displays. The pair was inspired to make the game by "Spacewar"; Tuck had remarked in 1966 while playing the game that a coin-operated version of the game would be very successful. Such a device was unfeasible in 1966 due to the cost of computers, but in 1969 DEC released the PDP-11 for US$20,000; while this was still too high for a commercially viable product, as most games in arcades cost around US$1,000 at the time, the pair felt it was low enough to build a prototype to determine interest and optimal per-game pricing. Only prototype units were ever built, though the second prototype was adapted to run up to eight games at once; a few months before the initial installation at Stanford in November 1971, the pair met with Nolan Bushnell, who informed them of his own game he was making for a much lower price.

That game was "Computer Space", developed by Bushnell and Ted Dabney. They had found the Data General Nova, a US$4,000 computer that they thought would be powerful enough to run four games of "Spacewar" at once; the computer turned out to not actually be powerful enough for the project. While investigating the concept of replacing some of the computer with purpose-built hardware, however, the pair discovered that making a system explicitly for running such a game, rather than general programs, would be much less expensive: as low as $100. By 1971 when Bushnell met with Pitts and Tuck, a prototype version had been successfully displayed for a short time in August 1971 in a local bar, the design was nearly finished, and the pair had founded a company around it called Syzygy. Bushnell had also found a manufacturer for the game, Nutting Associates, who would make the final game cabinets and sell them to distributors. Bushnell felt that "Galaxy Game" was not a real competitor to "Computer Space", due to its high price. Pitts and Tuck believed, however, that despite the economic argument their game was superior, as they felt that "Galaxy Game" was a true expansion of "Spacewar", while "Computer Space" just a pale imitation. Some players at the time, however, believed "Galaxy Game" to actually be just a version of "Spacewar!". "Galaxy Game"s prototype installation was very popular, though at a low price-per-game, and the pair developed a second version to display at the same location; they were never able to enter production, though, as they eventually had to abandon the idea after spending US$65,000 developing it due to the high cost and lack of business plan.
Around the same time as "Galaxy Game"s prototype installation, "Computer Space" was released. It was the first coin-operated video game to be commercially sold (and the first widely available video game of any kind). While it did well in its initial locations near college campuses, it performed very poorly in bars and arcades where pinball and other arcade games were typically placed; while it was commercially successful and made over US$1,000,000, it did not meet the high expectations of Nutting, who had expected to sell more than 1,500 units. Bushnell and Dabney immediately started work on another game, using the same television set design as "Computer Space", as well as founding their own company Atari, Inc. to back their projects. While initially this game was to be a driving game that Bushnell planned to design, their first employee, Allan Alcorn, took a prototype ping-pong game suggestion of Bushnell's and expanded on it to create a game the company immediately seized on. They were unable to find a manufacturer, but on the evidence of the success of their prototype installation, decided to produce the game cabinets themselves. "Pong" was released in 1972, a year after "Computer Space". It was immensely commercially successful, selling over 8,000 units. It inspired copycat games to be sold in America, Europe, and Japan, and led to the popularization of the medium.

That same year saw the release of the Magnavox Odyssey, the first home video game console which could be connected to a television set. The inventor, Ralph H. Baer, had initially had the idea in 1951 to make an interactive game on a television set. Unable to do so with the technological constraints at the time, he began work on a device that would attach to a television set and display games in 1966, and the "Brown Box", the last prototype of seven, was licensed to Magnavox to adapt and produce. They announced the console in May 1972, and it went on sale that September. The console and its games featured numerous innovations beyond being the first video game device for home consumers: it was the first game to use a raster-scan video display, or television set, directly displayed via modification of a video signal; it was also the first video gaming device to be displayed in a television commercial. It sold for US$100 and shipped with several games, including "Table tennis", which Bushnell had seen a demo of and which "Pong" had been based on. The Odyssey sold over 100,000 units in 1972, and more than 350,000 by the end of 1975, buoyed by the popularity of the table tennis game, in turn driven by the success of "Pong". "Pong" and the Odyssey kicked off a new era of video gaming, with numerous other competitors starting up in the video game industry as it grew in popularity.

Early history of video games

Early history of video games

The history of game making begins with the development of the first video games, although which video game is the first depends on the definition of "video game". The first games created had little entertainment value, and their development focus was separate from user experience—in fact, these games required mainframe computers to play them. "OXO", written by Alexander S. Douglas in 1952, was the first computer game to use a digital display. In 1958, a game called "Tennis for Two", which displayed its output on an oscilloscope, was made by Willy Higinbotham, a physicist working at the Brookhaven National Laboratory. In 1961, a mainframe computer game called "Spacewar!" was developed by a group of Massachusetts Institute of Technology students led by Steve Russell.

Video game development

Video game development is the process of creating a video game. The effort is undertaken by a game developer, who may range from a single person to an international team dispersed across the globe. Traditional commercial PC and console games are normally funded by a publisher, and can take several years to reach completion. Indie games can take less time and can be produced at a lower cost by individuals and smaller developers. The independent game industry has seen a substantial rise in recent years with the growth of new online distribution systems, such as Steam and Uplay, as well as the mobile game market, such as for Android and iOS devices.

The first video games were non-commercial, and were developed in the 1960s. They required mainframe computers to run and were not available to the general public. Commercial game development began in the 1970s with the advent of first-generation video game consoles and early home computers like the Apple I. Due to low costs and low capabilities of computers, a lone programmer could develop a full game. However, approaching the 21st century, ever-increasing computer processing power and heightened consumer expectations made it difficult for a single person to produce a mainstream console or PC game. The average cost of producing a triple-A video game slowly rose from 1–4 million in 2000 to over $5 million in 2006, then to over $20 million by 2010.

Mainstream PC and console games are generally developed in phases. First, in pre-production, pitches, prototypes, and game design documents are written. If the idea is approved and the developer receives funding, a full-scale development begins. This usually involves a team of 20–100 individuals with various responsibilities, including designers, artists, programmers, and testers.

Games are produced through the software development process. Games are developed as a creative outlet and to generate profit. Development is normally funded by a publisher. Well-made games bring profit more readily. However, it is important to estimate a game's financial requirements, such as development costs of individual features. Failing to provide clear implications of game's expectations may result in exceeding allocated budget. In fact, the majority of commercial games do not produce profit. Most developers cannot afford changing development schedule and require estimating their capabilities with available resources before production.

The game industry requires innovations, as publishers cannot profit from constant release of repetitive sequels and imitations. Every year new independent development companies open and some manage to develop hit titles. Similarly, many developers close down because they cannot find a publishing contract or their production is not profitable. It is difficult to start a new company due to high initial investment required. Nevertheless, growth of casual and mobile game market has allowed developers with smaller teams to enter the market. Once the companies become financially stable, they may expand to develop larger games. Most developers start small and gradually expand their business. A developer receiving profit from a successful title may store up a capital to expand and re-factor their company, as well as tolerate more failed deadlines.

An average development budget for a multiplatform game is US$18-28M, with high-profile games often exceeding $40M.

In the early era of home computers and video game consoles in the early 1980s, a single programmer could handle almost all the tasks of developing a game — programming, graphical design, sound effects, etc. It could take as little as six weeks to develop a game. However, the high user expectations and requirements of modern commercial games far exceed the capabilities of a single developer and require the splitting of responsibilities. A team of over a hundred people can be employed full-time for a single project.

Game development, production, or design is a process that starts from an idea or concept. Often the idea is based on a modification of an existing game concept. The game idea may fall within one or several genres. Designers often experiment with different combinations of genres. A game designer generally writes an initial game proposal document, that describes the basic concept, gameplay, feature list, setting and story, target audience, requirements and schedule, and finally staff and budget estimates. Different companies have different formal procedures and philosophies regarding game design and development. There is no standardized development method; however commonalities exist.
A game developer may range from a single individual to a large multinational company. There are both independent and publisher-owned studios. Independent developers rely on financial support from a game publisher. They usually have to develop a game from concept to prototype without external funding. The formal game proposal is then submitted to publishers, who may finance the game development from several months to years. The publisher would retain exclusive rights to distribute and market the game and would often own the intellectual property rights for the game franchise. Publisher's company may also own the developer's company, or it may have internal development studio(s). Generally the publisher is the one who owns the game's intellectual property rights.

All but the smallest developer companies work on several titles at once. This is necessary because of the time taken between shipping a game and receiving royalty payments, which may be between 6 and 18 months. Small companies may structure contracts, ask for advances on royalties, use shareware distribution, employ part-time workers and use other methods to meet payroll demands.

Console manufacturers, such as Microsoft, Nintendo, or Sony, have a standard set of technical requirements that a game must conform to in order to be approved. Additionally, the game concept must be approved by the manufacturer, who may refuse to approve certain titles.

Most modern PC or console games take from one to three years to complete., where as a mobile game can be developed in a few months. The length of development is influenced by a number of factors, such as genre, scale, development platform and number of assets.

Some games can take much longer than the average time frame to complete. An infamous example is 3D Realms' "Duke Nukem Forever", announced to be in production in April 1997 and released fourteen years later in June 2011. Planning for Maxis' game "Spore" began in late 1999; the game was released nine years later in September 2008. The game "Prey" was briefly profiled in a 1997 issue of PC Gamer, but was not released until 2006, and only then in highly altered form. Finally, "Team Fortress 2" was in development from 1998 until its 2007 release, and emerged from a convoluted development process involving "probably three or four different games", according to Gabe Newell.

The game revenue from retails is divided among the parties along the distribution chain, such as — developer, publisher, retail, manufacturer and console royalty. Many developers fail to profit from this and go bankrupt. Many developers seek alternative economic models through Internet marketing and distribution channels to improve returns., as through a mobile distribution channel the share of a developer can be up to 70% of the total revenue and through an online distribution channel almost 100%.

True commercial design and development of games began in the 1970s, when arcade video games and first-generation consoles were marketed. In 1971, "Computer Space" was the first commercially sold, coin-operated video game. It used a black-and-white television for its display, and the computer system was made of 74 series TTL chips. In 1972, the first home console system was released called Magnavox Odyssey, developed by Ralph H. Baer. That same year, Atari released "Pong", an arcade game that increased video game popularity. The commercial success of "Pong" led other companies to develop "Pong" clones, spawning the video game industry.

Programmers worked within the big companies to produce games for these devices. The industry did not see huge innovation in game design and a large number of consoles had very similar games. Many of these early games were often "Pong" clones. Some games were different, however, such as "Gun Fight", which was significant for several reasons: an early 1975 on-foot, multi-directional shooter, which depicted game characters, game violence, and human-to-human combat. Tomohiro Nishikado's original version was based on discrete logic, which Dave Nutting adapted using the Intel 8080, making it the first video game to use a microprocessor. Console manufacturers soon started to produce consoles that were able to play independently developed games, and ran on microprocessors, marking the beginning of second-generation consoles, beginning with the release of the Fairchild Channel F in 1976.

The flood of "Pong" clones led to the video game crash of 1977, which eventually came to an end with the mainstream success of Taito's 1978 arcade shooter game "Space Invaders", marking the beginning of the golden age of arcade video games and inspiring dozens of manufacturers to enter the market. Its creator Nishikado not only designed and programmed the game, but also did the artwork, engineered the arcade hardware, and put together a microcomputer from scratch. It was soon ported to the Atari 2600, becoming the first "killer app" and quadrupling the console's sales. At the same time, home computers appeared on the market, allowing individual programmers and hobbyists to develop games. This allowed hardware manufacturer and software manufacturers to act separately. A very large number of games could be produced by an individual, as games were easy to make because graphical and memory limitation did not allow for much content. Larger companies developed, who focused selected teams to work on a title. The developers of many early home video games, such as "Zork", "Baseball", "Air Warrior", and "Adventure", later transitioned their work as products of the early video game industry.

The industry expanded significantly at the time, with the arcade video game sector alone (representing the largest share of the gaming industry) generating higher revenues than both pop music and Hollywood films combined. The home video game industry, however, suffered major losses following the North American video game crash of 1983. In 1984 Jon Freeman warned in "Computer Gaming World":

Chris Crawford and Don Daglow in 1987 similarly advised prospective designers to write games as a hobby first, and to not quit their existing jobs early. The home video game industry was revitalized soon after by the widespread success of the Nintendo Entertainment System.

By 1987 a video game required 12 months to develop and another six to plan marketing. Projects remained usually solo efforts, with single developers delivering finished games to their publishers. With the ever-increasing processing and graphical capabilities of arcade, console and computer products, along with an increase in user expectations, game design moved beyond the scope of a single developer to produce a marketable game. This sparked the beginning of team-based development. In broad terms, during the 1980s, pre-production involved sketches and test routines of the only developer. In the 1990s, pre-production consisted mostly of game art previews. In the early 2000s, pre-production usually produced a playable demo.

In 2000 a 12 to 36 month development project was funded by a publisher for US$1M–3M. Additionally, $250k–1.5M were spent on marketing and sales development. In 2001, over 3000 games were released for PC; and from about 100 games turning profit only about 50 made significant profit. In the early 2000s it became increasingly common to use middleware game engines, such as Quake engine or Unreal engine.

In the early 2000s, also mobile games started to gain popularity. However, mobile games distributed by mobile operators remained a marginal form of gaming until the Apple App Store was launched in 2008.

In 2005, a mainstream console video game cost from US$3M to $6M to develop. Some games cost as much as $20M to develop. In 2006 the profit from a console game sold at retail was divided among parties of distribution chain as follows: developer (13%), publisher (32%), retail (32%), manufacturer (5%), console royalty (18%). In 2008 a developer would retain around 17% of retail price and around 85% if sold online.

Since the third generation of consoles, the home video game industry has constantly increased and expanded. The industry revenue has increased at least five-fold since the 1990s. In 2007, the software portion of video game revenue was $9.5 billion, exceeding that of the movie industry.

The Apple App Store, introduced in 2008, was the first mobile application store operated directly by the mobile platform holder. It significantly changed the consumer behaviour more favourable for downloading mobile content and quickly broadened the markets of mobile games.

In 2009 games market annual value was estimated between $7–30 billion, depending on which sales figures are included. This is on par with films box office market. A publisher would typically fund an independent developer for $500k–$5M for a development of a title. In 2012, the total value had already reached $66.3 billion and by then the video game markets were no longer dominated by console games. According to Newzoo, the share of MMO's was 19.8%, PC/MAC's 9.8%, tablets' 3.2%, smartphones 10.6%, handhelds' 9.8%, consoles' only 36.7% and online casual games 10.2%. The fastest growing market segments being mobile games with an average annual rate of 19% for smartphones and 48% for tablets.

In the past several years, many developers opened and many closed down. Each year a number of developers are acquired by larger companies or merge with existing companies. For example, in 2007 Blizzard Entertainment's parent company, Vivendi Games merged with Activision. In 2008 Electronic Arts nearly acquired Take-Two Interactive. In 2009 Midway Games was acquired by Time-Warner and Eidos Interactive merged with Square Enix.

Development is overseen by internal and external producers. The producer working for the developer is known as the "internal producer" and manages the development team, schedules, reports progress, hires and assigns staff, and so on. The producer working for the publisher is known as the "external producer" and oversees developer progress and budget. Producer's responsibilities include PR, contract negotiation, liaising between the staff and stakeholders, schedule and budget maintenance, quality assurance, beta test management, and localization. This role may also be referred to as "project manager", "project lead", or "director".

A video game publisher is a company that publishes video games that they have either developed internally or have had developed by an external video game developer. As with book publishers or publishers of DVD movies, video game publishers are responsible for their product's manufacturing and marketing, including market research and all aspects of advertising.

They usually finance the development, sometimes by paying a video game developer (the publisher calls this external development) and sometimes by paying an internal staff of developers called a studio. Consequently, they also typically own the IP of the game. Large video game publishers also distribute the games they publish, while some smaller publishers instead hire distribution companies (or larger video game publishers) to distribute the games they publish.

Other functions usually performed by the publisher include deciding on and paying for any license that the game may utilize; paying for localization; layout, printing, and possibly the writing of the user manual; and the creation of graphic design elements such as the box design.

Large publishers may also attempt to boost efficiency across all internal and external development teams by providing services such as sound design and code packages for commonly needed functionality.

Because the publisher usually finances development, it usually tries to manage development risk with a staff of producers or project managers to monitor the progress of the developer, critique ongoing development, and assist as necessary. Most video games created by an external video game developer are paid for with periodic advances on royalties. These advances are paid when the developer reaches certain stages of development, called milestones.

Independent video game developers create games without a publisher and may choose to digitally distribute their games.

Developers can range in size from small groups making casual games to housing hundreds of employees and producing several large titles. Companies divide their subtasks of game's development. Individual job titles may vary; however, roles are the same within the industry. The development team consists of several members. Some members of the team may handle more than one role; similarly more than one task may be handled by the same member. Team size can vary from 20 to 100 or more members, depending on the game's scope. The most represented are artists, followed by programmers, then designers, and finally, audio specialists, with two to three producers in management. These positions are employed full-time. Other positions, such as testers, may be employed only part-time. Salaries for these positions vary depending on both the experience and the location of the employee. An entry-level programmer can make, on average, around $70,000 annually and an experienced programmer can make, on average, around $125,000 annually.

A development team includes these roles or disciplines:

A game designer is a person who designs gameplay, conceiving and designing the rules and structure of a game. Development teams usually have a lead designer who coordinates the work of other designers. They are the main visionary of the game. One of the roles of a designer is being a writer, often employed part-time to conceive game's narrative, dialogue, commentary, cutscene narrative, journals, video game packaging content, hint system, etc. In larger projects, there are often separate designers for various parts of the game, such as, game mechanics, user interface, characters, dialogue, etc.

A game artist is a visual artist who creates video game art. The art production is usually overseen by an "art director" or "art lead", making sure their vision is followed. The art director manages the art team, scheduling and coordinating within the development team.

The artist's job may be 2D oriented or 3D oriented. "2D artists" may produce concept art, sprites, textures, environmental backdrops or terrain images, and user interface. "3D artists" may produce models or meshes, animation, 3D environment, and cinematics. Artists sometimes occupy both roles.

A game programmer is a software engineer who primarily develops video games or related software (such as game development tools). The game's codebase development is handled by programmers. There are usually one to several lead programmers, who implement the game's starting codebase and overview future development and programmer allocation on individual modules.

Individual programming disciplines roles include:

A level designer is a person who creates levels, challenges or missions for computer and/or video games using a specific set of programs. These programs may be commonly available commercial 3D or 2D design programs, or specially designed and tailored level editors made for a specific game.

Level designers work with both incomplete and complete versions of the game. Game programmers usually produce level editors and design tools for the designers to use. This eliminates the need for designers to access or modify game code. Level editors may involve custom high-level scripting languages for interactive environments or AIs. As opposed to the level editing tools sometimes available to the community, level designers often work with placeholders and prototypes aiming for consistency and clear layout before required artwork is completed.

Sound engineers are technical professionals responsible for sound effects and sound positioning. They sometimes oversee voice acting and other sound asset creation. Composers who create a game's musical score also comprise a game's sound team, though often this work is outsourced.

The quality assurance is carried out by game testers. A game tester analyzes video games to document software defects as part of a quality control. Testing is a highly technical field requiring computing expertise, and analytic competence.

The testers ensure that the game falls within the proposed design: it both works and is entertaining.This involves testing of all features, compatibility, localization, etc. Although, necessary throughout the whole development process, testing is expensive and is often actively utilized only towards the completion of the project.

Game development is a software development process, as a video game is software with art, audio, and gameplay. Formal software development methods are often overlooked. Games with poor development methodology are likely to run over budget and time estimates, as well as contain a large number of bugs. Planning is important for individual and group projects alike.

Overall game development is not suited for typical software life cycle methods, such as the waterfall model.

One method employed for game development is agile development. It is based on iterative prototyping, a subset of software prototyping. Agile development depends on feedback and refinement of game's iterations with gradually increasing feature set. This method is effective because most projects do not start with a clear requirement outline. A popular method of agile software development is Scrum.

Another successful method is Personal Software Process (PSP) requiring additional training for staff to increase awareness of project's planning. This method is more expensive and requires commitment of team members. PSP can be extended to Team Software Process, where the whole team is self-directing.

Game development usually involves an overlap of these methods. For example, asset creation may be done via waterfall model, because requirements and specification are clear, but gameplay design might be done using iterative prototyping.

Development of a commercial game usually includes the following stages:

"Pre-production" or "design phase" is a planning phase of the project focused on idea and concept development and production of initial design documents. The goal of concept development is to produce clear and easy to understand documentation, which describes all the tasks, schedules and estimates for the development team. The suite of documents produced in this phase is called production plan. This phase is usually not funded by a publisher, however good publishers may require developers to produce plans during pre-production.

The concept documentation can be separated into three stages or documents—high concept, pitch and concept; however, there is no industry standard naming convention, for example, both Bethke (2003) and Bates (2004) refer to "pitch document" as "game proposal", yet Moore, Novak (2010) refers to "concept document" as "game proposal".

The late stage of pre-production may also be referred to as "proof of concept", or "technical review" when more detailed game documents are produced.

Publishers have started to expect broader game proposals even featuring playable prototypes.

"High concept" is a brief description of a game. The high concept is the one-or two-sentence response to the question, "What is your game about?".

A "pitch", "concept document", proposal document, or "game proposal" is a short summary document intended to present the game's selling points and detail why the game would be profitable to develop.

Verbal pitches may be made to management within the developer company, and then presented to publishers. A written document may need to be shown to publishers before funding is approved. A game proposal may undergo one to several "green-light meetings" with publisher executives who determine if the game is to be developed. The presentation of the project is often given by the game designers. Demos may be created for the pitch; however may be unnecessary for established developers with good track records.

If the developer acts as its own publisher, or both companies are subsidiaries of a single company, then only the upper management needs to give approval.

"Concept document", "game proposal", or "game plan" is a more detailed document than the pitch document. This includes all the information produced about the game. This includes the high concept, game's genre, gameplay description, features, setting, story, target audience, hardware platforms, estimated schedule, marketing analysis, team requirements, and risk analysis.

Before an approved design is completed, a skeleton crew of programmers and artists usually begins work. Programmers may develop quick-and-dirty prototypes showcasing one or more features that stakeholders would like to see incorporated in the final product. Artists may develop concept art and asset sketches as a springboard for developing real game assets. Producers may work part-time on the game at this point, scaling up for full-time commitment as development progresses. Game producers work during pre-production is related to planning the schedule, budget and estimating tasks with the team. The producer aims to create a solid production plan so that no delays are experienced at the start of the production.

Before a full-scale production can begin, the development team produces the first version of a game design document incorporating all or most of the material from the initial pitch. The design document describes the game's concept and major gameplay elements in detail. It may also include preliminary sketches of various aspects of the game. The design document is sometimes accompanied by functional prototypes of some sections of the game. The design document remains a living document throughout the development—often changed weekly or even daily.

Compiling a list of game's needs is called "requirement capture".

Writing prototypes of gameplay ideas and features is an important activity that allows programmers and game designers to experiment with different algorithms and usability scenarios for a game. A great deal of prototyping may take place during pre-production before the design document is complete and may, in fact, help determine what features the design specifies. Prototyping at this stage is often done manually, (paper prototyping), not digitally, as this is often easier and faster to test and make changes before wasting time and resources into what could be a canceled idea or project. Prototyping may also take place during active development to test new ideas as the game emerges.

Prototypes are often meant only to act as a proof of concept or to test ideas, by adding, modifying or removing some of the features. Most algorithms and features debuted in a prototype may be ported to the game once they have been completed.

Often prototypes need to be developed quickly with very little time for up-front design (around 15 to 20 minutes of testing). Therefore, usually very prolific programmers are called upon to quickly code these testbed tools. RAD tools may be used to aid in the quick development of these programs. In case the prototype is in a physical form, programmers and designers alike will make the game with paper, dice, and other easy to access tools in order to make the prototype faster.

A successful development model is iterative prototyping, where design is refined based on current progress. There are various technology available for video game development

Production is the main stage of development, when assets and source code for the game are produced.

Mainstream production is usually defined as the period of time when the project is fully staffed. Programmers write new source code, artists develop game assets, such as, sprites or 3D models. Sound engineers develop sound effects and composers develop music for the game. Level designers create levels, and writers write dialogue for cutscenes and NPCs. Game designers continue to develop the game's design throughout production.

Game design is an essential and collaborative process of designing the content and rules of a game, requiring artistic and technical competence as well as writing skills. Creativity and an open mind is vital for the completion of a successful video game.

During development, the game designer implements and modifies the game design to reflect the current vision of the game. Features and levels are often removed or added. The art treatment may evolve and the backstory may change. A new platform may be targeted as well as a new demographic. All these changes need to be documented and disseminated to the rest of the team. Most changes occur as updates to the design document.

The programming of the game is handled by one or more game programmers. They develop prototypes to test ideas, many of which may never make it into the final game. The programmers incorporate new features demanded by the game design and fix any bugs introduced during the development process. Even if an off-the-shelf game engine is used, a great deal of programming is required to customize almost every game.

From a time standpoint, the game's first level takes the longest to develop. As level designers and artists use the tools for level building, they request features and changes to the in-house tools that allow for quicker and higher quality development. Newly introduced features may cause old levels to become obsolete, so the levels developed early on may be repeatedly developed and discarded. Because of the dynamic environment of game development, the design of early levels may also change over time. It is not uncommon to spend upwards of twelve months on one level of a game developed over the course of three years. Later levels can be developed much more quickly as the feature set is more complete and the game vision is clearer and more stable.

Game audio may be separated into three categories—sound effects, music, and voice-over.

Sound effect production is the production of sounds by either tweaking a sample to a desired effect or replicating it with real objects. Sound effects are important and impact the game's delivery.

Music may be synthesized or performed live.

There are several ways in which music is presented in a game.A game title with 20 hours of single-player gameplay may feature around 60 minutes of music.

Voice-overs and voice acting creates character gameplay interactivity. Voice acting adds personality to the game's characters.

At the end of the project, quality assurance plays a significant role. Testers start work once anything is playable. This may be one level or subset of the game software that can be used to any reasonable extent. Early on, testing a game occupies a relatively small amount of time. Testers may work on several games at once. As development draws to a close, a single game usually employs many testers full-time (and often with overtime). They strive to test new features and regression test existing ones. Testing is vital for modern, complex games as single changes may lead to catastrophic consequences.

At this time features and levels are being finished at the highest rate and there is more new material to be tested than during any other time in the project. Testers need to carry out regression testing to make sure that features that have been in place for months still operate correctly. Regression testing is one of the vital tasks required for effective software development. As new features are added, subtle changes to the codebase can produce unexpected changes in different portions of the game. This task is often overlooked, for several reasons. Sometimes, when a feature is implemented and tested, it is considered "working" for the rest of the project and little attention is given to repeated testing. Also, features that are added late in development are prioritized and existing features often receive insufficient testing time. Proper regression testing is also increasingly expensive as the number of features increases and is often not scheduled correctly.

Despite the dangers of overlooking regression testing, some game developers and publishers fail to test the full feature suite of the game and ship a game with bugs. This can result in customers dissatisfaction and failure to meet sales goals. When this does happen, most developers and publishers quickly release patches that fix the bugs and make the game fully playable again.

Commercial game development projects may be required to meet milestones set by publisher. Milestones mark major events during game development and are used to track game's progress. Such milestones may be, for example, "first playable", "alpha", or "beta" game versions. Project milestones depend on the developer schedules.

Milestones are usually based on multiple short descriptions for functionality; examples may be "Player roaming around in game environment" or "Physics working, collisions, vehicle" etc. (numerous descriptions are possible). These milestones are usually how the developer gets paid; sometimes as "an advance against royalty". These milestones are listed, anywhere from three to twenty depending on developer and publisher. The milestone list is usually a collaborative agreement between the publisher and developer. The developer usually advocates for making the milestone descriptions as simple as possible; depending on the specific publisher - the milestone agreements may get very detailed for a specific game. When working with a good publisher, the "spirit of the law" is usually adhered to regarding milestone completion... in other words if the milestone is 90% complete the milestone is usually paid with the understanding that it will be 100% complete by the next due milestone. It is a collaborative agreement between publisher and developer, and usually (but not always) the developer is constrained by heavy monthly development expenses that need to be met. Also, sometimes milestones are "swapped", the developer or publisher may mutually agree to amend the agreement and rearrange milestone goals depending on changing requirements and development resources available. Milestone agreements are usually included as part of the legal development contracts. After each "milestone" there is usually a payment arrangement. Some very established developers may simply have a milestone agreement based on the amount of time the game is in development (monthly / quarterly) and not specific game functionality - this is not as common as detailed functionality "milestone lists".

There is no industry standard for defining milestones, and such vary depending on publisher, year, or project. Some common milestones for two-year development cycle are as follows:

The "first playable" is the game version containing representative gameplay and assets, this is the first version with functional major gameplay elements. It is often based on the prototype created in pre-production. Alpha and first playable are sometimes used to refer to a single milestone, however large projects require first playable before feature complete alpha. First playable occurs 12 to 18 months before code release. It is sometimes referred to as the "Pre-Alpha" stage.

"Alpha" is the stage when key gameplay functionality is implemented, and assets are partially finished. A game in alpha is "feature complete", that is, game is playable and contains all the major features. These features may be further revised based on testing and feedback. Additional small, new features may be added, similarly planned, but unimplemented features may be dropped. Programmers focus mainly on finishing the codebase, rather than implementing additions. Alpha occurs eight to ten months before code release, but this can vary significantly based on the scope of content and assets any given game has.

"Code freeze" is the stage when new code is no longer added to the game and only bugs are being corrected. Code freeze occurs three to four months before code release.

"Beta" is feature and asset complete version of the game, when only bugs are being fixed. This version contains no bugs that prevent the game from being shippable. No changes are made to the game features, assets, or code. Beta occurs two to three months before code release.

"Code release" is the stage when many bugs are fixed and game is ready to be shipped or submitted for console manufacturer review. This version is tested against QA test plan. First code release candidate is usually ready three to four weeks before code release.

"Gold master" is the final game's build that is used as a master for production of the game.

Overtime is expected in the games industry. Particularly, "crunch time" or "crunch mode" is unpaid overtime requested by many companies to meet project deadlines and milestones that negatively affects game developers. A team missing a deadline risks the danger of having the project cancelled or employees being laid off. Although many companies are reducing the amount of crunch time, it is still prominent in smaller companies.

Many companies offer time-off, called "comp time" or extra paid time off after product ships to compensate for crunch time's negative effects. Some companies offer bonuses and financial rewards for successful milestone reach. Sometimes on-site "crunch meals" are offered and delivered to the team during crunch time.
The International Game Developers Association (IGDA) surveyed nearly 1,000 game developers in 2004 and produced a report to highlight the many problems caused by bad practice.

After the game goes gold and ships, some developers will give team members "comp time" (perhaps up to a week or two) to compensate for the overtime put in to complete the game, though this compensation is not standard.

Once a game ships, the maintenance phase for the video game begins.

Games developed for video game consoles have had almost no maintenance period in the past. The shipped game would forever house as many bugs and features as when released. This was common for consoles since all consoles had identical or nearly identical hardware; making incompatibility, the cause of many bugs, a non-issue. In this case, maintenance would only occur in the case of a port, sequel, or enhanced remake that reuses a large portion of the engine and assets.

In recent times popularity of online console games has grown, and online capable video game consoles and online services such as Xbox Live for the Xbox have developed. Developers can maintain their software through downloadable patches. These changes would not have been possible in the past without the widespread availability of the Internet.

PC development is different. Game developers try to account for majority of configurations and hardware. However, the number of possible configurations of hardware and software inevitably leads to discovery of game-breaking circumstances that the programmers and testers didn't account for.

Programmers wait for a period to get as many bug reports as possible. Once the developer thinks they've obtained enough feedback, the programmers start working on a patch. The patch may take weeks or months to develop, but it's intended to fix most accounted bugs and problems with the game that were overlooked past code release, or in rare cases, fix unintended problems caused by previous patches. Occasionally a patch may include extra features or content or may even alter gameplay.

In the case of a massively multiplayer online game (MMOG), such as a MMORPG or MMORTS, the shipment of the game is the starting phase of maintenance. Such online games are in continuous maintenance as the gameworld is continuously changed and iterated and new features are added. The maintenance staff for a popular MMOG can number in the dozens, sometimes including members of the original programming team.

Several development disciplines, such as audio, dialogue, or motion capture, occur for relatively short periods of time. Efficient employment of these roles requires either large development house with multiple simultaneous title production or outsourcing from third-party vendors. Employing personnel for these tasks full-time is expensive, so a majority of developers outsource a portion of the work. Outsourcing plans are conceived during the pre-production stage; where the time and finances required for outsourced work are estimated.The game production has similar distribution methods to those of music and film industries.

The publisher's marketing team targets the game for a specific market and then advertises it. The team advises the developer on target demographics and market trends, as well as suggests specific features. The game is then advertised and the game's high concept is incorporated into the promotional material, ranging from magazine ads to TV spots. Communication between developer and marketing is important.

The length and purpose of a game demo depends on the purpose of the demo and target audience. A game's demo may range between a few seconds (such as clips or screenshots) to hours of gameplay. The demo is usually intended for journalists, buyers, trade shows, general public, or internal employees (who, for example, may need to familiarize with the game to promote it). Demos are produced with public relations, marketing and sales in mind, maximizing the presentation effectiveness.

As a game nears completion, the publisher will want to showcase a demo of the title at trade shows. Many games have a "Trade Show demo" scheduled.
The major annual trade shows are, for example, Electronic Entertainment Expo (E3) or Penny Arcade Expo (PAX). E3 is the largest show in North America. E3 is hosted primarily for marketing and business deals. New games and platforms are announced at E3 and it received broad press coverage. Thousands of products are on display and press demonstration schedules are kept. In recent years E3 has become a more closed-door event and many advertisers have withdrawn, reducing E3's budget. PAX, created by authors of Penny Arcade blog and web-comic, is a mature and playful event with a player-centred philosophy.
A game created in one language may also be published in other countries which speak a different language. For that region, the developers may want to translate the game to make it more accessible. For example, some games created for PlayStation Vita were initially published in Japanese language, like "Soul Sacrifice". Non-native speakers of the game's original language may have to wait for the translation of the game to their language. But most modern big-budget games take localization into account during the development process and the games are released in several different languages simultaneously.

Localization is the process of translating the language assets in a game into other languages. By localizing games, they increase their level of accessibility where games could help to expend the international markets effectively. Game localization is generally known as language translations yet a "full localization" of a game is a complex project. Different levels of translation range from: zero translation being that there is no translation to the product and all things are sent raw, basic translation where only a few text and subtitles are translated or even added, and a full translation where new voice overs and game material changes are added.

There are various essential elements on localizing a game including translating the language of the game to adjusting in-game assets for different cultures to reach more potential consumers in other geographies (or globalization for short). Translation seems to fall into the scope of localization, which itself constitutes a substantially broader endeavor. These include the different levels of translation to the globalization of the game itself. However, certain developers seem to be divided on whether globalization falls under localization or not.

Moreover, in order to fit into the local markets, game production companies often change or redesign the graphic designs or the packaging of the game for marketing purposes. For example, the popular game "Assassin's Creed" has two different packaging designs for the Japanese and US market. By localizing the graphics and packaging designs, companies might arouse better connections and attention from the consumers from various regions.

Independent games or "indie games" are produced by individuals and small teams with no large-scale developer or publisher affiliations. Indie developers generally rely on Internet distribution schemes. Many hobbyist indie developers create mods of existing games. Indie developers are credited for creative game ideas (for example, "Darwinia", "", "World of Goo"). Current economic viability of indie development is questionable, however in recent years internet delivery platforms, such as, Xbox Live Arcade and Steam have improved indie game success. In fact, some indie games have become very successful, such as "Braid", "World of Goo", and "Minecraft".

The video game industry (formally referred to as interactive entertainment) is the economic sector involved with the development, marketing and sale of video games. The industry sports several unique approaches.

Game development culture always has been and continues to be very casual by normal business standards. Many game developers are strongly individualistic and usually tolerant of divergent personalities. Despite the casual culture, game development is taken seriously by its practitioners, who may take offense if it is suggested that they don't have "a real job."

In the United States, in the early history of video game development, the prominent locale for game development was the corridor from San Francisco to Silicon Valley in California. Most new developers in the US open near such "hot beds".

At present, many large publishers still operate there, such as: Activision Blizzard, Capcom Entertainment, Disney Interactive, Eidos Interactive, Electronic Arts, Foundation 9, LucasArts Entertainment, Namco Bandai Games, Sega of America, Sony Computer Entertainment America, THQ. However, due to the nature of game development, many publishers are present in other regions, such as Big Fish Games (Washington), GarageGames (Oregon), Majesco Entertainment (New Jersey), Microsoft Corporation (Washington), Nintendo of America (Washington), Take-Two Interactive (New York), SouthPeak Games (Virginia).

Many universities and design schools are offering classes specifically focused on game development. Some have built strategic alliances with major game development companies. These alliances ensure that students have access to the latest technologies and are provided the opportunity to find jobs within the gaming industry once qualified. Many innovative ideas are presented at conferences, such as Independent Games Festival (IGF) or Game Developers Conference (GDC).

Indie game development may motivate students who produce a game for their final projects or thesis and may open their own game company.

Universities offer Computer Science degrees which give you a strong basis of knowledge if you wish to become a programmer

Video game industry employment is fairly volatile, similar to other artistic industries including television, music, etc. Scores of game development studios crop up, work on one game, and then quickly go under. This may be one reason why game developers tend to congregate geographically; if their current studio goes under, developers can flock to an adjacent one or start another from the ground up.

In an industry where only the top 20% of products make a profit, it's easy to understand this fluctuation. Numerous games may start development and are cancelled, or perhaps even completed but never published. Experienced game developers may work for years and yet never ship a title: such is the nature of the business. This volatility is likely inherent to the artistic nature of games.