Atari to Go Bankrupt
Atari, which is based in France is officially in the process of filing for bankruptcy. The US based portion of the company, Atari US, has just announced its intention to file for Chapter 11 bankruptcy protection. The company perhaps best known for the Ms Pacman arcade machine, has been in business for nearly three decades.
The company was the first to produce the most popular home video gaming console, earning them hundreds of millions of dollars. For years, Atari was at the forefront of the gaming industry, releasing bestselling games, accessories and arcade cabinets. Once the popularity of the Ms Pacman arcade machine franchise started to die down, so did the profits. As a result, Atari split into several separate entities in order to pursue different sectors in the gaming business.
Although Atari never again became a dominant force in gaming, it was still a profitable company. By porting many of its arcade classics for mobile devices, its profitability increased. After a mobile game is developed, relatively little funding is necessary. BlueBay became a majority shareholder in the company in the late 2000s.
Unfortunately, Atari has not been able to gain the funding that it needs to remain in business. Mobile games are popular, but so are illegal copies of games as well as homebrew versions. Both Pacman and Ms Pacman are two of the most highly copied games in history. A simple Internet search will reveal millions of results, where users can play these titles online for free.
Even though Atari US and Atari are dangerously close to going bankrupt, there is still time for recovery. Another funding source, or a different company interested in purchasing Atari could help to revive the company. An influx of cash, or even a complete internal restructuring could be exactly what Atari needs to stay afloat. In the meantime, thousands of copies of games authored by Atari continue to fly off of the shelves. With time, patience and money, it is possible that the companies could pay off the more than $50 million in debts currently owed out. In addition, Atari would also need approximately $12 million in funding to continue business operations.