A collapsed negotiation between Coleco and Nintendo for the 1982 video game system, 'ColecoVision', in Japan potentially triggered the introduction of the famous Famicom in 1983.

A Failed Nintendo-Coleco Deal Paved Way for Famicom's Birth

The legacy of video games boasts some fascinating stories, and one such intriguing anecdote was recently shared by a former executive of Coleco, Bert Reiner. He painted a compelling scenario about Coleco's abortive negotiation with Nintendo, which may have indirectly spawned the conceptualization and eventual birth of Nintendo's home video game console, the Famicom, in 1983.

The American toy and console maker, Coleco, had been courting the idea of selling its 1982 video game system, 'ColecoVision', in Japan. According to Reiner, there was a valid point in time when Nintendo had almost decided to purchase the console for distribution in Japan. But due to tricky negotiation dynamics, the deal never came to fruition.

Amid their discussion, Nintendo expressed a desire to take up the entire deal independently. They were interested in conducting their own manufacturing, their own marketing, and basically control every aspect of the business process. As for the financial aspect, Nintendo had proposed to provide Coleco with 10 percent of their selling price instead of buying the game console from Coleco at 10% below the wholesale price.

Reiner recalls being rather optimistic about Nintendo's proposed deal. According to him, their part in the proposed arrangement required absolute zero-effort, yet ensured them a 10 percent share on each unit sold in Japan. However, the deal collapsed due to an inability to reach a satisfactory agreement. The negotiation session, despite being lengthy, came to a concluded with both parties walking off without striking a deal.

Following the aborted negotiation, Hiroshi Yamauchi, the then-president of Nintendo, reportedly vowed that Nintendo would develop its own console. Interestingly, despite Yamauchi's determined statement being somewhat dismissed by the Coleco party, things turned out quite differently.

The world soon saw the launch of Nintendo's Famicom in 1983, which would later transform the gaming industry and become a well-renowned name amongst global gamers. It also bears mentioning that prior to the initiation of the unsuccessful Nintendo-Coleco deal, Coleco had previously joined hands with Nintendo to bundle a copy of the popular arcade game 'Donkey Kong' with each ColecoVision console, a deal that gave a significant boost to the system's sales in the West.

Reflecting back on the matter, Reiner acknowledges the missed opportunity but lauds Nintendo for their subsequent success, highlighting the unpredictability and rapid evolution of the gaming industry. Observing the growth of Nintendo post-negotiation, any spectator might agree that it appears Nintendo firmly adhered to their former president Yamauchi's prediction and subsequently changed the dynamics of the gaming industry with the launch of Famicom.

The detailed account of the incident makes for interesting reading for anyone keen on the historical evolution of gaming consoles, and provides insight into how one negotiation's fall-through can potentially spark a revolution in the gaming industry, representing a decisive twist in the journey of Nintendo and re-emphasizing the fascinating dynamics of the corporate world.

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John Hope

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