Fifteen years later, Ralph Baer released the Brown Box; Magnavox licensed Baer's device and five years later released it under the name Odyssey - it was the first home gaming console.

Odyssey made Magnavox a lot of money, but not through outright sales: the company sued Atari for stealing one of Odyssey's games to create Pong, the company's first arcade game, and in 1975, the first home video game, which eventually reaped the benefits. over $100 million in royalties and damages. In other words, IP and control disputes have been part of the industry from the beginning.

All the games for Atari were made by Atari, because of course they were; IBM split the mainframe software and hardware in 1969 in a (unsuccessful) attempt to prevent an antitrust case , but in 1977 video games as a category barely existed. Indeed, just four years earlier Steve Wozniak had teamed up with Steve Jobs to design the circuit board for the arcade game Atari Breakout ; the story is best known for the fact that Jobs lied to Wozniak about the size of the bonus he earned, but the relevant point in this article is that video game development at that time was inextricably linked to hardware.

However, that's why the 2600 was so unique: games were not tied to hardware, but rather contained in cartridges, which meant that players could use the same system to play a whole bunch of different games.

Activision, which struggled to raise money given the fact that it was targeting a market that didn't yet exist and faced immediate lawsuits from Atari, was hugely successful; venture capital now sought to fund the market, leading to many third-party developers, few of whom had Activision's experience or skills. The result was a flood of poor-quality games that spoiled the consumer experience across the market, leading to the legendary video game crash of 1983: industry revenues plummeted from $3.2 billion in 1983 to just $100 million in 1985. to making games for the nascent personal computer market.

The personal computer market was modular from the start, and not just in terms of software. Compaq's success in reverse engineering the IBM PC BIOS created a market for PC-compatible computers, all of which ran Microsoft's increasingly common operating system (first DOS, then Windows). This meant that developers such as Activision could target Windows and benefit from competition in the underlying hardware.