Atari 2600, 5200, 7800

In the early 1980s Atari had a choke hold on the infant console gaming market. Coleco and Mattel produced technically superior competitors but the Atari 2600 managed to dominate them both. Brand recognition played a major role, "Atari" was synonymous with home gaming. Despite their apparent strength, Atari recognized that the 2600 was getting stale. There was only so much the system could do and it wouldn't be long before someone knocked them off.

The Atari 5200 was their attempt to get ahead of the curve. Due to a redesigned cartridge slot, it could not play play 2600 games though. Gamers were not warm to this, they didn't like the idea that their 2600 games were now unusable. Those that didn't own a 2600 were reluctant to buy this newer system with few games available.

This was the first time a major gaming company tried something like this, there was no precedent or experience to leverage. It wasn't long before Atari conceded to customer demand and released an adapter to play 2600 games on the 5200.

The poor Atari 5200 never stood a chance though. It was as much a victim of the 1983 video game crash as it was a cause. This was also the first time a game company had to figure out how to balance pimping their new system with supporting the previous one. There must have been a tug-of-war going on at Atari. One group pulling to expand the "next-gen" system with another pulling for the resident cash cow. The result was that neither were well supported and both crashed, hard. This may go a long way towards explaining why future console manufacturers were quick to move all resources to their latest, greatest system.