This success led Atari and other firms to begin work on home game consoles that could be hooked to TV sets. Atari released its first home console in 1977. Soon games were put on cartridges that could be changed at the whim of the player. By 1979, the company, Activision, was formed by former Atari game designers. The purpose of this new company was to focus strictly on game software. They decided to leave the development of equipment to play electronic games to other people. This was the first company to build a business of developing and selling electronic games software. Claude Shannon believed that computers could be programmed to play chess. In a sense he was right. He certainly never imagined chess players reaching across cyberspace as they exercise chess strategies on computerized game boards.
In a short time a spate of game companies sprang up trying to develop software for the infant electronic game industry. The result was a glut of poorly conceived games hitting the market. Consumers turned away in droves and the home electronic game industry faded hit the skids. By the early 1980s, electronic games were being developed for personal computers. Color graphics, flexible storage capacity and general purpose processors made games much easier to play on personal computers. The game console business was all but dead. Nor could he have imagined video poker, Internet casinos and all of the other popular electronic games people of all ages are playing. Electronic games aren’t just for kids anymore. Many of the top game companies are betting that older adults are the new growth market for the game industry.
In the late 1980s, two Japanese companies introduced a new generation of game consoles that were technologically capable of handling the new electronic games being produced. These companies were Nintendo and Sega. These game consoles had graphics capabilities that exceeded those of most personal computers. Nintendo also offered a feature that let the console record the game action so a player could pause the action of a game. Right behind Nintendo came Game Boy, a hand-held game console. Game consoles enjoyed a resurgence of popularity during the 1990s. A new, even more sophisticated generation of electronic games was introduced by 2001. These consoles included Playstation2 and Xbox. Electronic games continued to become more complex with more action and more graphics.
As electronic games have matured they have begun to attract more mature audiences. Initially these games were primarily toys for boys. The growth area in the game industry is no longer adolescent males. It is mature adults, both men and women. Many of the most popular board games have been adapted to electronic game formats. Where youngsters hooked game consoles to TV sets, adults are playing games on their PCs, often against other players across the Internet. Grandparents are playing electronic games with grandchildren. They are also joining game clubs to play electronic games on the Internet with other senior citizens in another state or half a world away.