Chapter 1146: Tiangong Electronics vs. Atari

'Chairman, I have already sent two teams to Philips and Sony respectively, and I have also brought our CD disc samples and invitations. The two companies should still be conducting performance tests.'

'On the invitation, it is clearly stated that the meeting time is September 15th, and the location is in Xiangjiang.'

'As soon as they see the performance of our CD, the project leaders from both companies will definitely come to negotiate in a few days.'

'We have now completed the preparations for the negotiations.'

Fok Kin-ning respectfully reported the situation.

Xia Yu nodded slightly and smiled, 'Okay, let me know the result of the negotiations in a few days.'

'By the way, you mustn't forget to send someone to the newly acquired record company to get familiar with the situation first, and the CD recording equipment must be produced in advance.'

'No matter if Philips and Sony bow or not, our standards must be promoted. The worst that can happen is a battle, and you must have the confidence to fight!'

Fok Kin-ning's eyes lit up slightly, and he responded with a little more volume, 'Yes!'

'If there's nothing else, then you can go ahead and get to work.'

After Xia Yu finished speaking, he looked down at the documents on the table.

Fok Kin-ning hesitated for a moment, but still felt that he needed to discuss this matter with Xia Yu.

'Chairman, I have another matter I would like to report to you, concerning Metro-Goldwyn-Mayer Studios and Galaxy Studios.'

Xia Yu's expression twitched slightly, and he looked back up at Huo Jianning with interest and asked, 'Is it about the movie E.T. the Extra-Terrestrial?'

Huo Jianning nodded, and after organising his thoughts, he said, 'Yes, more precisely, the game rights to E.T. the Extra-Terrestrial.'

Xia Yu smiled faintly, quietly looking at Huo Jianning and indicating for him to continue.

The latter told the details: 'Chairman, the Alien E.T. movie is now sweeping the world, causing a huge sensation around the world, especially in developed countries in Europe and the United States. It can be said that everyone knows about it.'

'Just the day before yesterday, Manager Wu Siyuan, out of goodwill, suddenly called me and said that the American company Atari had approached MGM Pictures and was very interested in purchasing the home game development rights to Alien E.T.'

'Manager Wu Siyuan, considering that Atari is Tiangong Electronics' biggest competitor, was afraid that selling the copyright would have a huge impact on Tiangong Electronics, so he told me about it and asked my attitude.'

Having said this, Fok Kin-ning didn't say anything more, as the meaning was clear.

In fact, it didn't matter whether he told Xia Yu about it or not, after all, the purpose of cooperation between brother companies was to make more profits for the boss.

However, he is cautious and meticulous by nature. After learning that the movie E.T. the Extra-Terrestrial was the result of Chairman Xia Yu personally negotiating with Steven Spielberg when he was in the United States, and that it was the work that led to the rise of MGM Studios and the pioneering work of Galaxy Studios, he was afraid that the Chairman still had some strategic plan for it. Therefore, after some consideration, he felt that he should still inform the Chairman and listen to his opinion.

If the chairman has no plans, it would be better if he just agreed.

It's just a matter of saying a few more words, so it's safer to mention it.

After listening to Huo Jianning's account, Xia Yu's memory seemed to be stimulated, and his knuckles tapped the table as he fell into deep thought.

Huo Jianning's heart tightened, and he was glad that he had told the chairman about this and hadn't just gone ahead and done it.

He took a deep breath, remained patient and quietly watched Xia Yu, waiting for the next part of the story.

After a long while, Xia Yu came back to his senses.

Just as Huo Jianning thought Xia Yu would make a statement, Xia Yu asked a question: 'Jianning, I remember that last time when we visited the laboratory, you told me that in the current home game console market, Atari was number one and Tiangong Electronics was number two, right?'

Fok Kin-ning nodded and said, 'Yes, since we launched our first home game console, the TG-MasterSystem, in December 1980, we have quickly risen to second place in the market thanks to our globally popular games.'

'As of this month, our global sales of this home game console have reached more than 860 million units, ranking second in the world, second only to the Atari 2600 console.'

Xia Yu gave a smile of praise, 'It has already exceeded 8 million units, not bad.'

Last time in the Tiangong Technology Laboratory, Huo Jianning led him on a tour of Tiangong Electronics' mainstay, the gaming division.

At that time, in addition to the arcade division, which had already become the world's number one, the home console market, which had entered later, also became the world's number two, surpassing Nintendo from the island country, Fairchild Semiconductor from the United States, Mattel from the United States, Philips from the Netherlands, NEC from the island country, and many other players. At that time, the global sales of the TG-System game console had not yet reached 8 million units, but in just a few months it had already reached its current sales.

At that time, Xia Yu also asked Fok Kin-ning specifically and learned that the TG-MasterSystem game console was jointly developed by Tiangong Electronics and the Japanese company Sega, with the main research and development strength coming from the Japanese company Sega.

However, since Tiangong Electronics was the parent company, the game console developed was named TG, and Sega also produced games for the TG-MasterSystem.

In fact, the TG-MasterSystem game console was also the largest platform in the home console market in the island country, surpassing Nintendo's CTG6 and CTG15. Many game manufacturers based their game cartridges on the TG-MasterSystem game console, and it became the little brother of Teco Electronics and Sega.

Of course, the key was that Taito itself had many fun arcade games, and after they were ported from the arcade to the home console, they were still unbeatable in the market and quickly captured a large market share.

The reason why the Atari 2600 game console became popular worldwide was still because of arcade games.

In 1979, the annual sales of the Atari 2600 game console were only 3 million units.

However, in January 1980, with the help of the game Space Invaders, which was ported from the arcade, the sales of the console exceeded 7 million units that year, and the game cartridge for Space Invaders sold more than 2 million copies.

Then Atari continued to port excellent arcade games to its home game consoles, which is why global sales reached an astonishing 11 million units last year.

Of course, after Tiangong Electronics initially ported several arcade games to the Atari 2600, Fok Kin-ning decisively terminated the cooperation, developed a home game console on his own, and then relied on its own unique excellent games to catch up with Atari.

It is precisely because of Tiangong Electronics' strength as the world's number one in the arcade market that Atari also regards Tiangong Electronics as its biggest competitor. The key is still the influential high-quality games.

Back to the topic.

When visiting the Tiangong Technology laboratory at the time, Xia Yu also saw the second-generation TG – the MasterSystem game console – under development. Apart from finding out what was going on, he also made some very good suggestions, based on the Nintendo NFC game console that would go on to sweep the world.

Thinking about this, Xia Yu asked again, 'Jianing, has the second-generation Tiangong MasterSystem game console been developed yet?'

Fok Jianing nodded: 'It has been developed, and is now being optimised. According to plan, it will be launched on the market before Christmas this year.'

'Are there any new games to go with it?' Xia Yu continued to ask.

Fok Kin-ning shook his head and said, "There are no shortage of new games. We have prepared five new games with different styles. In addition, our trump cards, such as Super Mario, Tetris, and Battle City, have also been redesigned with new levels and the game quality has been optimised.'

Xia Yu immediately understood and smiled faintly, saying, "In other words, even if there is no game of the same name as E.T. the Extra-Terrestrial, you are still confident in launching it onto the market?'

How could Fok Kin-ning not understand this time?

He sighed inwardly, then answered honestly, 'Yes, Chairman.'

Xia Yu smiled and asked another question that was difficult for Huo Jianning to answer: "Jianning, Atari is still the world's number one home game console manufacturer. How long do you think it will take for Tiangong Electronics to overtake it?'

Huo Jianning frowned and thought for a long time before saying, "Chairman, it's hard to say. The key is not in us, but in Atari itself.'

'Our rise in the home game console market has been rapid, and we are now rapidly closing the gap with Atari, putting Atari under a lot of pressure.'

'However, starting this year, in order to cope with the pressure from us and other competitors, Atari has been releasing game cartridges very quickly. For example, in June, there were just over 100 games for the Atari 2600 console platform, but now there are already more than 200, which is almost equivalent to releasing two games every day. It's terrifying.'

'But we have also been analysing it, and found that the quality of the games released by Atari can only be considered to be average to below average. It mainly wins by quantity, relying on the huge number of games to sift out the good ones. This is living off past success and cheating consumers out of their money.'

'So in fact, we, these followers, are all joining forces to pressure Atari, hoping that it will make a mistake and completely wear down consumers' patience.'

'If we were to make an estimate based on the current situation, we would say that we could overtake Atari and become the world's number one company in three years' time.'

'Of course, if a game company comes along and releases a game that becomes an instant hit around the world, it could overtake us just as we overtook Taito before. And if Atari changes its ways and relies on its current market position, it could still remain the dominant company.

'But we are not without measures. In order to defeat Atari as soon as possible, we are preparing to rely on the second-generation TG-MasterSystem game console to launch a comprehensive offensive this Christmas. Atari is also targeting the Christmas market and I hear that it is working full steam on developing a blockbuster game.'

'Now that Atari is eyeing the game rights to the globally popular E.T. the Extra-Terrestrial, I suspect that they plan to use the influence of this movie to develop it into a trump card game to capture the market.'

Xia Yu said with a smile, 'In that case, let's give the game rights to E.T. the Extra-Terrestrial to Atari.'

Fok Kin-ning was suddenly taken aback.