At the beginning of 1978 Atari's coin-op business was still coming to grips with the microprocessor technology now used in most of its games, while pushing forward with game and cabinet innovations.
By that time, the coin-op group had expanded to four core teams (adding fresh talent such as Mike Albaugh and Ed Logg to the ranks), each with consisting of a team leader (usually a senior electrical engineer), plus a couple of programmers, a couple electrical engineers, and a couple technicians.
Unlike the solo work on VCS games, coin-ops were a team effort. The focus was still on technology, because the graphical capabilities of the hardware were still fairly primitive.
"Graphic and cabinet design were a 'shared resource', and 'graphics' meant physical stuff, not pixels. Teams did their own pixels, which we called 'dots' at the time, none of us having taken a computer-graphics class." xl
- Mike Albaugh
Atari started 1978 with an aerial action game named Sky Raider released in March. Still working from the "military" theme of earlier games, Sky Raider had the player fly over a scrolling landscape, dropping bombs on enemy targets. It was one of the first games to keep a high score (though without initials).
"Sky Raider will be a super attraction game...it was first previewed at the ATE show in London where the overall reaction was superb" xli
-Frank Ballouz, Atari Marketing executive
One of Atari's earliest coin-ops from 1978 was Avalanche, programmed by Dennis Koble and released in April. Avalanche was a sort of a "reverse Breakout", in which rocks fell from the top of screen and had to be caught by the player.
Soon after, in June, Atari released the Fire Truck coin-op. Fire Truck was one of the first cooperative multiplayer coin-ops. One or two players would guide a hook and ladder fire truck around a city.
The game cabinet consisted of a seat for the driver with a steering wheel for the cab, and a platform directly behind the seat with another steering wheel used for the second player to control the ladder portion of the fire-truck.
"Fire Truck was a follow-up to Superbug. The idea was to create a two player cooperative driving game. In Fire Truck, one player drove the front of the truck, and the other player drove the rear. It was trickier than it sounds. " xlii
A single player version of the game named Smokey Joe was released in August 1978, intended for locations that didn't have room for the massive Fire Truck cabinets.
July 1978 saw the release of Skydiver, programmed by Owen R. Rubin. The game consisted of a player jumping from an airplane and guiding their avatar to hit a spot on the ground.
Rubin, a pinball fan, added a "pinball feature": the name of the game on the marquee would light up when you landed successfully. If you were able to light the full name, you would win a bonus life, points, or a free game. Rubin had to fight his superiors to get this added to the game. xliii
"I was a pinball fan, so this is the first video game to have a pinball feature. When I asked for it, I had to fight to get it added because they thought I was crazy."xliv
- Owen R. Rubin
When Ed Logg joined Atari in 1978, he immediately started working with Atari engineer Dennis Koble on the ill-fated and unreleased coin-op Dirt Bike. When that project was cut short, he moved on to Super Breakout, a follow-up to the established 1976 Atari hit Breakout. Released in August, Super Breakout was a sizable hit with nearly 5000 units sold. xlv
The game improved on Breakout in many ways: it was written for a microprocessor (6502) instead of discrete logic, and it included 3 game variations -- Double Breakout (two walls separated by a space), Progressive (continuous walls that scroll down the screen), and Cavity (two balls embedded in a standard wall).
"The original idea was to have six variations on Breakout... However, in actual play there was one overall favorite, Progressive Breakout". In the end we put three variations in one game: Progressive, Double, and Cavity Breakout." xlvi
- Ed Logg
Other coin-ops released in 1978 were Sprint 1, a 1-player version of Atari sister company Kee's Sprint 2, Ultra Tank, a version of Tank inspired by Atari VCS Combat, with eight game variations, and Orbit, a raster version of Space War developed for the European market by Owen R. Rubin in six to eight weeks. xlvii
As well, there were several notable unreleased games in 1978, many with military themes. These included Wolf Pack, PT Commander, and Captain Seahawk, plus the decidedly non-military Mini Golf.
One very interesting unreleased game from this year was Tunnel Hunt, programmed by Owen R. Rubin. Tunnel Hunt was a pseudo-3D shooting game that was determined to simply not be fun enough for release. The game was later sold to Exidy as Vertigo and then to Centuri as Tube Chase.
"Marketing felt just flying was not fun enough, so we added Star Wars-like objects that flew down the tube at you and you had to shoot them. It was a good game, but they kept wanting changes. It did a solid #2 and #3 for 12 weeks in tests, but Atari could not decide to ship it." xlviii
- Owen R Rubin
The biggest coin-op game for Atari in 1978 was Football. Football was a huge hit when it was released in October, just in time for the NFL season.
"Several folks at Atari had wanted to do a football game for a while, by the time I got there. I believe Steve Bristow and Lyle Rains were the main promoters of the idea, however the technology was not quite up to it. With the move toward microprocessor-controlled games, it started looking possible." xlix
- Mike Albaugh
The game included an innovative new controller scheme named a Trak-Ball (trademarked in October 1977) that was used to control the game. By rolling the ball faster and slower in any direction, the Trak-Ball could be used to control direction and velocity of the X's and O's -- the on-screen players.
"When we brainstormed about controls, I wanted a trackball. They had existed for a while, but were fiendishly expensive. I harassed Jerry Lichac, one of our ace mechanical engineers, with a number of harebrained schemes. Meanwhile, Sega produced a soccer game with a trackball. It was not a great design, but served as an 'existence proof' to quiet Atari management claims that a trackball was inherently too expensive. Jerry came through in style. His "three-point suspension" was the first I ever saw in such a context, and was widely adopted shortly thereafter in pretty much every (mechanical) mouse. Too bad he never patented it." l
- Mike Albaugh
Football sold an astonishing 10,450 arcade machines li within a few months. At the very same time, the Space Invaders coin-op from Taito was sweeping the nation (and the world) and driving thousands of people back into the arcades. Football benefitted from this influx, and held its own against Space Invaders through the end of 1978. However, sales dropped off drastically when the NFL season ended. By early 1979 Atari was giving the games away for the rock-bottom price of $395.
By fiscal 1979, Atari's coin division has only generated $52 million is sales, as opposed to nearly $200 million for the consumer division. It was clear that the coin-op division was not going to be the primary focus of Atari. However, Atari's coin-op division did not take the success of Space Invaders lightly, and moved quickly to create its own space-themed games to compete in the new marketplace.