In movies, titles like Heaven’s Gate and Plan 9 From Outer Space are synonymous with disaster, with cars it’s the Edsel, and in gaming, it’s the video game adaptation of E.T.
Some may argue the title hastened the demise of Atari, and in fact, the company did go swiftly downhill not long after the E.T. game flopped.
Yet, E.T. was the biggest box office hit of all time way back when, so how could a video game based on it fail? The title not only seemed like the sure-fire licensing deal a studio would kill for today, but it also came at the peak of gaming in the eighties.
Atari was owned by Warner Brothers, and the late Steve Ross, who was the architect of the Time Warner merger, wanted Steven Spielberg to make movies at the studio, even though the director had strong ties to Universal.
As Connie Bruck, Ross’s biographer reports in the book Master of the Game, Spielberg and Ross became friends in the summer of ’82, when E.T. was a box office juggernaut. Both Spielberg and Ross were big gamers, and Spielberg promised Ross he’d get first crack at the game rights to E.T. Atari first offered Universal $1 million and a 7% royalty, which the studio turned down, but before anyone knew it, Ross closed a $23 million deal with Spielberg.
Ross then announced the game had to be ready by Christmas. The usual development period Atari needed for games was six months lead time to make delivery. Now they had four or five weeks to get things moving.
One Atari exec also realized E.T. wasn’t suited to be turned into a video game, recalling it was a "lovely sweet movie," but kids playing video games "like to kill things." Still, Atari pressed on. Four million games were going to roll off production lines, but then focus group reports came in predicting Atari would only sell a third of that.
E.T. the game hit stores in time for Thanksgiving, but out of the four million copies shipped, 3.5 million were returned back to the company. No one could have predicted that Atari could have gone down so drastically and quickly after the company had its biggest year, but Atari now had stiff competition with Coleco rolling out Donkey Kong, and Parker Brothers’ throwing its hat in the video game ring with Frogger.
By the summer of 1983, the video game industry had officially crashed. As former Atari executive Charles Paul recalled to Connie Bruck, he believed the E.T. game was "a terrible mistake. I knew it hadn’t caused the downfall of Atari but it did throw gasoline on the fire."
Still, Paul admired the gamble Ross took, because it brought Steven Spielberg to Warner Brothers.
"He succeeded in breaking MCA’s hold on Spielberg. Steve’s viewpoint was, so what if I overpay by $22 million? How can you compare that to the value of a relationship with Spielberg? And I think he was dead right."
Today the E.T. game is an odd capstone to the end of the ‘80’s era of gaming. And as a report on Yahoo confirmed, many of the E.T. game cartridges wound up in a landfill in New Mexico, but if you’re curious to play it, there’s tons of E.T. game cartridges on EBay that survived, and they’re certainly not an expensive collector’s item.