Company Founder Says Atari Was Ruined By Warner Acquisition

Nolan Bushnell, founder of the classic game brand and console Atari, said selling the company to Warner Communications was a huge mistake.

He also believes the acquisition was the driving force behind the downfall of Atari, according to Gamespot.

Bushnell made the revelation during his Reddit AMA.

The Atari, which is considered as one of the pioneering consoles in the gaming industry, was co-founded by Bushnell in 1971. The company gained recognition after the release of its "Pong" arcade tennis game in 1972.

In 1976, Bushnell sold the company to Warner Communications for around $30 million. Looking back, Bushnell now regrets his decision.

"Don't sell to big Hollywood studios," he wrote. "Atari had an extraordinary corporate culture that was destroyed within two years of the sale."

"I think that Atari would still be important today if that sale hadn't occurred," he added.

Following the sale, Bushnell constantly argued with Manny Gerard, the then-CEO of Warner regarding the management of Atari. In 1978, Bushnell decided to leave the company.

The founder hinted that his decision to sell Atari was driven by the time's market conditions. Since Atari was just beginning to blossom at that time, Bushnell had a hard time competing against larger and more established corporations.

"Atari was the most frightening thing because I was really young and dumb," he stated. "And everybody in the business was bigger, had better presence in the marketplace and had more cash. In the early days of Atari, we were totally unable to raise venture capital - so we were outgunned in every direction."

"Our only weapon was that we were the most creative and slowly but surely that difference allowed us to secure an 85% market share," he added.

Years after Bushnell's departure from Atari, Warner sold its various divisions to other companies during the late 1980s.

After Atari filed for bankruptcy in 2013, the company announced that it is planning to release new services that cater to social casinos, real-money gambling, exclusive YouTube videos and the LGBT demographic, according to Games Radar.