Exhibit / September 19, 2017

Object Name: Sears Tele-Games Video Arcade and Coleco Gemini
Maker and Year: Sears, Roebuck & Co., 1977; Coleco, 1982
Object Type: Video game consoles
Video Source: eyeh8cbs YouTube channel (Sears Tele-Games); Retrontario (Coleco Gemini)
Description: (Michael Grasso)

In the early years of home video gaming, Pong reigned supreme. Released in its arcade cabinet incarnation in 1972, Pong became a sensation and inspired a revolution in computer gaming, headed by Sunnyvale, California’s Atari. As Atari’s programmers created more games for the lucrative arcade market, the race was on to create versions that could be played at home on a television set. By no means an expert in business marketing, Atari president Nolan Bushnell secured a business relationship with one of America’s most successful and dominant market forces in retailing: Chicago’s Sears, Roebuck & Company. Sears began as a mail-order retailer in 1886, but, in the middle of the 20th century, it established brick and mortar department stores all across America. By the early 1970s, Sears accounted for 1% of the GDP of the United States and employed half a million people. A new $150-million headquarters was erected, the imposing Sears Tower in Chicago: America’s new tallest building.

But even amidst this dominance in the early 1970s, Sears was seeing its market share begin to crumble around the edges, as the first energy crisis pinched shut America’s pocketbooks. The inherent conservatism of Sears was exposed to the public in the infamous “Yellow Book” leaks to Crain’s in 1978. An investment world expecting bold new moves to raise the company out of the economic malaise was confronted with a statement that Sears was “not a store for the whimsical.” Reaction to these leaks led Sears executives to shore up old brands, establish new ones, and to actively seek celebrity sponsorship partnerships to create excitement and bolster the chain’s reputation against new regional upstarts like Wal-Mart and Target, which were fast becoming nationwide players.

But still, the middle-class public’s trust in Sears—as well as the company’s omnipresent reach—made it a logical choice for Atari. In time for Christmas 1975, the Pong video game console was released under the “Tele-Games” imprint at Sears—but the unit was designed and manufactured by Atari. 150,000 of the consoles were sold that Christmas, and the success cemented a relationship between the two companies—one old and staid, the other young and daring—that came to its fruition as Atari’s work on ROM game cartridges finally broke through with the the Atari VCS (later the Atari 2600).

When Atari was ready to release its new cartridge-based video game system, Sears acted as one distributor, but not sole distributor. Atari had released Pong under its own name after Christmas 1975, achieving tremendous success, and so Bushnell and co. did not seek to sell the new VCS exclusively through Sears. Nevertheless, Sears was offered the opportunity to rebadge the VCS with the Tele-Games name, and the console was marketed as a “Home Video Arcade.” As the Atari name rose in prominence, Sears reassured consumers that its Tele-Games Video Arcade systems were entirely compatible with Atari cartridges. One wonders what kind of boost the Atari VCS/2600 would’ve given Sears if Sears had negotiated an exclusive agreement as they did with Pong.

As the Atari VCS became America’s premier video game console, other companies sought to get a piece of the pie. Intellivision soon became Atari’s number-one competitor, but lesser lights like Connecticut’s Coleco soon learned that if you can’t beat them, you join them. The ColecoVision console, introduced in 1982, offered better graphics than the now half-decade-old Atari, but like other competitors had trouble beating the Atari juggernaut, and thus suffered from relatively poor sales. Coleco introduced a peripheral, called the “Expansion Module #1,” which allowed the ColecoVision to run Atari 2600 cartridges. Atari moved in quickly with a lawsuit, and offered Coleco a license to manufacture a straight-ahead clone of the 2600. While this deal introduced a much-needed design innovation in its merger of the Atari’s separate control inputs (joystick and paddle) into one controller, this license for the Coleco Gemini clone came at exactly the wrong time. The fact that the market was so saturated with clones and also-rans, and the fact that Atari would offer a license as a settlement, was evidence that the Video Game Crash of 1983 was right around the corner. (Sears even featured the 2600 and Gemini on facing pages in its 1983 Wishbook).

Coleco landed on its feet, though, returning to the company’s roots (as the doll-manufacturing Connecticut Leather Company) in 1983 with its massively popular line of Cabbage Patch Kids dolls, the next in a long line of 1980s toy fads.