What precipitated your decision to sell Atari to Warner Communications (in 1976)? Was it just more fun to start a company than run one?
Bushnell: What happened is a growing business consumes capital at prodigious rates. And Wall Street had a hard time distinguishing between the frivolity of our product and the fact that it was a serious business. Raising capital was very, very difficult for us. In order to go into the consumer marketplace, we just needed much deeper pockets, and that's why we decided to sell.
Besides video games, you also came that close to launching the PC business. What gave Apple the edge over the Atari 800?
Bushnell: The big difference was Warner Communications against Steve Jobs. Warner could never win that one. I don't know if I could have, but I wouldn't have made the same mistakes Warner did.
The main problem that allowed Apple to dominate was, in fact, not technology but business strategy. Steve was out evangelising to software developers to build software for their machines.
Our strategy with the video games was that we basically wanted to give away the hardware and make money on the software. That called for a quasi-closed system. Warner thought that was the right way to do the computers business, too. So they said, "Not only are we not going to help third-party developers, we're going to sue you if you use our operating environment." So everybody that wanted to get into the software business supported Apple over Atari.
So basically Warner drove the coffin nail in the Atari 800, despite it having a clearly superior chipset, a better operating environment ... We had a lot of innovations in the Atari 800 that became standard later on.
What would the PC business be like now if the 800 had been given a chance?
Bushnell: I know I wouldn't have made the mistakes Warner did.
Would you have made the mistakes Apple did later on?
Bushnell: I don't know. It's so gratuitous to say, "No, I would have been much smarter." I think that it would have been a good horse race.
Atari was known for being a very fun place to work, which seems to have gone out of the video game industry. Any advice for game developers today?
Bushnell: Atari's strategy was actually quite simple and, I think, quite elegant. We were known as a party place, but the important thing is that parties didn't happen unless quotas were made. We had a lot of parties because people made their numbers ... We had a very young work force that was more interested in having a party than making more money, so there was a sound business principle behind the parties.
Is it possible to run a company that way now, when it takes years and millions of dollars to make a game?
Bushnell: I think it would be hard. At the same time, I believe you can either treat employees as equals, as adults, in which you treat everybody with equal dignity. Or you can have a monarchy, where there are the executives and there are the serfs. Monarchies work, but in today's world, where people are highly educated, highly capable and highly mobile, I think treating them like adults is a better way.
You started out at a time when good ideas and hard work were all you needed. How has entrepreneurship changed since then?
Bushnell: I think it's still the same. I think the next Apple or the next Atari will be started within the next few months, we just won't know it for five years.
The venture capital process hasn't mucked everything up with focus groups and strategic planning?
Bushnell: In some ways the VC process has hurt things. I feel that in some ways, it's perhaps a blessing that Atari could not raise capital from third parties, so we had to do it by tricks and gimmicks. We didn't raise any venture capital until we were $40 million in sales.
The venture capitalists are clearly a catalyst to making things happen faster ... but I think it does represent a break from some of the creative business structures that were started. For instance, you can trace the casual dress code back to Atari. And it came from the premise that we don't care how you look, we don't care when you come to work -- as long as the work gets done. It's part of treating people like adults.
You were right about video games, right about high-tech pizza parlours. What about personal robots? Were you just ahead of the curve there?
The personal robot, to me, was a defeat -- and it was a defeat based on unintended consequences. We had a PC at the core, and in those days, noise immunity on a computer was very, very low. What we could not solve was that robots running across any surface would generate static electricity. When the static electricity was discharged, sometimes just across the bearings of the wheels, that was enough to reset the computer. We tried all kinds of isolation approaches.
With a computer, (if) you get the blue screen of death, you reboot, you go forward. In a robot environment, if you have a computer failure, all your sensors go out, all your fail-safe stuff. So the robot can be locked into a mode where it's going full-speed into a wall. We used to laughingly call that the "mow the baby" mode. It was a thing where we never felt the robot was ready for the marketplace.
I'm a little confused on what the plan is for uWink. Seems like you've got your finger in a lot of pies, from arcade games to mobile phones.
Bushnell: Within (a few) weeks, all will be made clear. We'll have a major announcement soon. Think of all these little pieces of technology that we have in our product lines, aiming toward a direction in which I had to develop certain pieces of technology, and I thought I'd monetise it on the way, but they were never the end goal.
So an autonomous, video game playing, coin-op pizza parlour robot?
Bushnell: (Chuckling) You forgot navigation systems.
Any regrets, like letting Steve Jobs quit, or selling Atari too cheap?
Bushnell: You can spend your life doing woulda, shoulda, coulda. I wish I hadn't sold to Warner, because I think that the world would be a very different place with Atari being the preeminent video game company today. It really bothers me that Sony and Nintendo and all those guys harvested the business that should have been rightly ours. The centre of gravity moved east, and it should rightly have been here.
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