[Bruce Abbott]

Originally Posted by Korban

Was the biggest selling computer of all time that was sold and predominately as a games system whose software sold well and launched many huge companies good for the gaming industry?
Is that really the question?

I'd have imagined there's a painfully obvious answer to that.

It's not so simple.

Video game crash of 1983

The video game crash of 1983 (known in Japan as the Atari shock) was a large-scale recession in the video game industry that occurred from 1983 to 1985, primarily in the United States. The crash was attributed to several factors, including market saturation in the number of video game consoles and available games, many of which were of poor quality. Waning interest in console games in favor of personal computers also played a role. Home video game revenue peaked at around $3.2 billion in 1983, then fell to around $100 million by 1985 (a drop of almost 97 percent)...

In 1982, a price war that began between Commodore and Texas Instruments led to home computers becoming as inexpensive as video-game consoles; after Commodore cut the retail price of the C64 to $300 in June 1983, some stores began selling it for as little as $199...Commodore explicitly targeted video game players... Commodore's ownership of chip fabricator MOS Technology allowed manufacture of integrated circuits in-house, so the VIC-20 and C64 sold for much lower prices than competing home computers. In addition, both Commodore computers were designed to utilize the ubiquitous Atari controllers so they could tap into the existing controller market.

"I've been in retailing 30 years and I have never seen any category of goods get on a self-destruct pattern like this", a Service Merchandise executive told The New York Times in June 1983.