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They still needed a really good idea to take them into the big time. Gunpei Yokoi came up with a new idea - game watches.
Take the LCD display that you find in a typical calculator of the time, some micro electronics and you have something ahead of its time. Nintendo sold millions of game watches. They were also as many clone game watches sold and this was something that Nintendo would remember. Despite the success of the game watch idea Hiroshi wanted a slice of the video arcade industry and so his team of engineers came up with games such as Hellfire, Radar scope and Sheriff.
Masayuki Uemura was set to work designing a more general purpose system. In the USA cartridge games systems were available but in the main the quality of the games was low and the price of the hardware was relatively high. Hiroshi had designed that the machine should cost no more than $75 and this implied 8-bit technology. Masayuki thought hard and designed a machine that was more suited to game playing than others. There was a lot of competition at the time so the Nintendo machine had to be good.
Masayuki looked at the competitors' machines and he was of the opinion that they were designed by engineers who were thinking about office, rather than games, machines. He used a standard 6502 processor but he added a special Picture Processing Unit chip to add extra graphics power. The production of the PPU chip was to be subcontracted and the firm most likely to win the contract was Ricoh - they had a slack period but the price that Nintendo wanted was ridiculously low. To make the price Ricoh wanted a minimum order of 3 million units - Hiroshi agreed even though to any reasonable observer the chances of selling 1 million would have seemed a gamble.
Hiroshi also insisted that the basic design should be simple - no keyboard, no disk drive. The new games machine should be as simple as possible. It would have only 2KBytes of RAM but the cartridges would have more memory than the average games machine and it had a direct connection to the CPU that would allow expansion.
The machine was launched in 1983 under the name Famicom.
Hiroshi understood the market well - at the launch he implored retailers to support the machine despite the low margins. The profits would come from the sales of the software yet to be written. The sales started to grow and then just before the peak sales period in the New Year a fault was found in the electronics. It was a small fault, one that many companies would have tried to cover up or at least postpone. Hiroshi decided to recall all of the Famicoms and replace the defective chip. As a result he lost millions in sales but the gamble paid off.
The sales increased rapidly but where was the software that was promised? Several million Famicoms sold and the opposition had retreated. Nintendo stood alone in the home games computer market and they could sell all that they could make.
The future of Nintendo and the whole games market depended on new software and Hiroshi had to deliver.
See Super Mario - Nintendo goes forward for the next part of the story.
Game Over by David Sheff (1994) is a good read that tells you about Nintendo and the growth of the games industry. The narrative occasionally is complex in terms of it time sequence. Many of the chapters overlap in time and this is confusing. The book is well written but you can tell all too clearly that Sheff isn't "one of us". He doesn't understand the technology and occasionally it shows - but somehow he still manages an accurate analysis of the historical situation. If you enjoy action thrillers and like computing you will get a lot out of this book.
Details of Game Over can be found at the top of the sidebar.
The Nintendo Database includes a histoy of the company and its products from 1889 to 2006.