These high-profile defections were not good for the coin-op division's morale or for its ability to produce hit games. However, Atari found a couple ways to replace this brain-drain, and it was not necessarily by hiring the best and the brightest new game designers to work in the Atari coin-op division.
One way was to start licensing games from other manufacturers. Atari had always had a close relationship with Namco, and in November if 1981 it entered into an agreement to license several of Namco's arcade titles for U.S. distribution. However, these games would not show-up on Atari roster until 1982.
Another way to start using outside development firms to create games. In mid-1981, an opportunity to expand the coin-op division to an outside agency literally fell in Atari's lap.
In June, a small company made-up of MIT students named GCC (General Computer Corporation) created a "mod kit" for Atari's Missile Command coin-op named Super Missile Attack and marketed it for $295. The mod kit would allow arcade operators to change the game, add options, and make it more difficult for players.
Atari found out about this kit, and while it existed in a legal grey area, Atari was worried about its effect on the integrity of its products. It filed a lawsuit against GCC for $15,000,000.
"They (the General Computer game enhancement) appear to our customers and to the public as Atari products, creating confusion and siphoning off legitimate returns from our investment in research and development."
- Frank E Balouz, Atari coin-op marketing VP
It turned out that GCC engineers were fairly skilled at making arcade games. The engineers had created a mod-kit for Pac-Man named Crazy Otto that they eventually sold to Namco, which became Ms. Pac-Man.
Atari knew talent when it saw it. The lawsuit never happened, and Atari settled with GCC out of court.
"They started getting really annoyed that we weren't rolling away... finally the light bulb went on: 'They might as well design games for us', so Atari drops their lawsuit... we signed a development deal with Atari to do engineering for them." clxxiv
- Steve Golson (GCC Engineer)
Atari contracted GCC to develop new coin-ops for the company. GCC went on to create the arcade games Quantum, Food Fight, and Nightmare (unreleased) clxxv, VCS games like Ms. Pac-Man and Vanguard, and the original design for the Atari 7800 console, as well as some of the first games for the system.
However, unlike Grass Valley from years before, GCC was never really integrated into Atari as a whole, and in fact, took direction from the likes of Ray Kassar and Manny Gerard, and not necessarily the internal development teams. Atari management, it seemed, was hedging their bets with the engineering department. If they could not find cooperation inside, they could always buy it from the outside.
"Our contract was not with Atari, our contract was with Warner who owned Atari... Whatever we came-up with would be force-fed to the Atari folks." clxxvi
- Steve Golson
Even though Atari had held back most of the technical documentation necessary for third party developers to create software for the 8-bit computer lines, developers had found their own resources to explore the machines.
Magazines like Compute had started running articles on the 400 and 800 as early as January 1980, and in them they explored topics on how the machine worked and how to write software for them. Some of these were written by Atari employees who were desperate to let the world know about the new machines.
"Anybody who has seen Atari's Star Raiders knows that the Atari Personal Computer System has vastly greater graphics capabilities than any other personal computer. Owners of these computers might wonder if they can get their machines to do the fabulous things that Star Raiders does. The good news is that you can indeed write programs with graphics and animation every bit as good as Star Raiders."
- Chris Crawford, In Compute's first Book Of Atari, 1981
The best news for Atari computer owners came in January when the first dedicated magazine for the Atari 8-bit machines, A.N.A.L.O.G., went into publication. With A.N.A.L.O.G., Atari owners had an independent resource for news that could both push the platform to computer enthusiasts...
"The Atari is also the 'hot' computer of the eighties: at the Consumer Electronics Show in Las Vegas this January -- three questions frequently asked at the information booth were 'where's the best restaurant, which way to the rest rooms, and where's the ATARI booth?'"
- A.N.A.L.O.G. Magazine #1
...and double as leverage on Atari and computer stores to support the platform.
"The color TRS-80 is a joke in comparison to even the 400. The APPLE II is archaic in technology next to the 800, and any other micro on the market just can't match the Atari's built-in computing power. Many computer stores won't carry the 400 or 800... 'there just isn't any software available', well we receive software and new products at an almost daily basis at the ANALOG office, so much that we have a difficult time reviewing it all. I am very impressed with the amount of really good software available in just a year's time." clxxvii
- A.N.A.L.O.G. Magazine #1
One of the reasons for the emergence of a dedicated magazine was that sales for the computers had picked up dramatically at the end of 1980 and into 1981.
"We've been saying Atari sales are picking up, a more than gradual creep that's been in evidence since summer. The trickle has apparently turned into a roar: it seems the pipeline effectively ran dry in mid-December when dealers across the country were selling machines faster than they could get them."
- Robert Lock, Compute!, February 1981
However, much of this had to do with the cult status of the game Star Raiders. The Atari computers provided graphics and gameplay far beyond anything previously available, and die-hard gamers were buying Atari computers simply to play games.
"If you own an Atari 800 computer don't forget there are other game cartridges besides Star Raiders available."
- Robert Baker, Compute!, April 1981
Even though Atari wanted to prove that its machines could do more than play games, the company started releasing its own game titles again in 1981, including a near-arcade perfect version of Missile Command, a surprisingly sub-par Asteroids (with bit-mapped graphics), and a decent Super Breakout, plus Chris Crawford's two edutainment games, Energy Czar and SCRAM.
Atari still supplemented these games with a load of serious software (Conversational Spanish, Bond Analysis, Stock Analysis, Stock Charting, Mailing List, Touch Typing, Calculator, Graph It) but the whether Atari liked it or not, the games had become the hook for new users.
One unique idea that came out of Atari at this time further support the 8-bit platform with software was A.P.X, The Atari Program Exchange. The APX was the brain-child of Dale Yocam. The idea was to take submissions of software from the Atari user community and market the best ones right back to the users.
"The guy who cooked up the idea, Dale Yocam, was trying to explain to the management that there are a lot people out there that like to write programs and if we can publish these programs for them, it's a win-win. The management was not very interested in it. He put together a business plan for it and said 'Look, we only need a little bit of money and this thing can be self sufficient and it might make some money.' They very grudgingly agreed to let him do it. And so he did it and very quickly made it into a monster success. It was a major profit center for Atari. They rewarded Dale for his initiative by bringing in another guy to be Dale's boss... so Dale, in disgust, quit about a year later." clxxviii
- Chris Crawford
It's interesting to note that A.P.X. was not just a resource for Atari customers. Many of Atari's internal VCS development staff wrote games that were released as A.P.X. titles. Lemonade Stand, Mugwump, Preschool Games, Reversi, Space Trek, and Dice Poker were written by Bob Polaro. Avalanche and Chinese Puzzle were written by Dennis Koble. Centurion, Castle, Alien Egg, and Tact Trek were written by Rob Zdybel. Lookahead was written by Bob Johnson, and Load N' Go by Brad Stewart. clxxix
By far, however, the most popular game created by an internal Atari programmer for A.P.X. was Eastern Front (1941), by Chris Crawford, released in September 1981. Eastern Front (1941) was a tactical war game that simulated the battle between the Germans and Russians in World War II.
Unlike most other tactical war games of the time, Eastern Front included colorful graphics and joystick input that completely streamlined the interface for a war game. Even though Eastern Front did not include animated battles, compared to the text-based games from Avalon Hill, it was a cinematic masterpiece. It played well, too.
"I have no hesitation in calling this one of the very best war games available for a personal computer. It is also a virtuoso demonstration of the awesome built-in capabilities of the Atari computer." clxxx
- Creative Computing
With games like these Chris Crawford seemed be on an (almost) singular quest (as an Atari insider) to simultaneously tell the world about the capabilities of the Atari 8-bit computers, and show just what magic you could weave with them. It also sold well. Even with the 10% royalty rate, Crawford made $90,000 from the game. clxxxi