First third-party videogame console developer

Independent videogame developer and publisher Activision was founded in October 1979 by former Atari programmers David Crane, Larry Kaplan, Alan Miller and Bob Whitehead, along with former music industry executive Jim Levy. The company became the first third-party developer of console videogames with the release of Fishing Derby, Dragster and Boxing – the company’s first three new cartridges for the Atari 2600 system – in July 1980. The impetus to create Activision came after Atari’s product-marketing group circulated a memo to its game-development team showing which of its games had sold well. The idea had been to inspire the game-development team to concentrate on making more profitable games, but the memo had the opposite effect – as Atari’s most successful game makers could easily see that their games were making Atari million of dollars in sales while they were getting paid just $30,000 per year. Using the sales data, the top four programmers first attempted to negotiate more favourable contracts, but when this proved unsuccessful they resigned from Atari to form Activision. Atari had not foreseen that any other company would want to develop games for the 2600, so had not built any mechanisms to prevent third-party cartridges from working in their consoles. Activision inspired many other companies to venture into game development in the early 1980s.