The story
Founded by Masaya Nakamura on Jun 1, 1955, in Tokyo.1
Origins and acquisition of Atari Japan (1955–1977)
On June 1, 1955, Japanese businessman Masaya Nakamura founded Nakamura Seisakusho Co., Ltd., in Ikegami, Tokyo. The son of a shotgun repair business owner, Nakamura proved unable to find work in his chosen profession of ship building in the struggling post-World War II economy. Nakamura established his own company after his father's business saw success with producing pop cork guns. Beginning with only ¥300,000 (US$12,000), Nakamura spent the money on two hand-cranked rocking horses that he installed on the roof garden of a Matsuya department store in Yokohama.
The horses were loved by children and turned a decent profit for Nakamura, who began expanding his business to cover other smaller locations. A 1959 business reorganization renamed the company Nakamura Seisakusho Company, Ltd. The Mitsukoshi department store chain noticed his success in 1963, and approached him with the idea of constructing a rooftop amusement space for its store in Nihonbashi, Tokyo. It consisted of horse rides, a picture viewing machine, and a goldfish scooping pond, with the centerpiece being a moving train named Roadaway Race. The space was a hit and led to Mitsukoshi requesting rooftop amusement parks for all of its stores.
Along with Taito, Rosen Enterprises, and Nihon Goraku Bussan, Nakamura Seisakusho became one of Japan's leading amusement companies. As the business grew in size, it used its clout to purchase amusement machines in bulk from other manufacturers at a discount, and then sell them to smaller outlets at full price. While its machines sold well, Nakamura Seisakusho lacked the manufacturing lines and distribution networks of its competitors, which made the production of them longer and more expensive.
The company was unable to place its machines inside stores because other manufacturers already had exclusive rights to these locations. In response, Nakamura Seisakusho opened a production plant in February 1966, moving its corporate office to a four-story building in Ōta, Tokyo. The company secured a deal with Walt Disney Productions to produce children's rides in the likenesses of its characters, in addition to those using popular anime characters like Q-Taro; this move allowed the business to further expand its operations and become a driving force in the Japanese coin-op market.
Though the manufacturing facility was largely reserved for its Disney and anime rides, Nakamura also used it to construct larger, more elaborate electro-mechanical games. The first of these was Torpedo Launcher (1965), a submarine warfare shooting gallery later titled Periscope. Its other products included Ultraman-themed gun games and pinball-like games branded with Osomatsu-kun characters.
The name Namco was introduced in 1971 as a brand for several of its machines. The company grew to having ten employees, which included Nakamura himself. It saw continued success with its arcade games, which had become commonplace in bowling alleys and grocery stores. The company also established a robotics division to produce robots for entertainment centers and festivals, such as those that distributed pamphlets, ribbon making machines, and a robot named Putan that solved pre-built mazes.
In August 1973, American game company Atari began establishing a series of divisions in Asia, one of which was named Atari Japan. Its president, Kenichi Takumi, approached Nakamura in early 1974 to have his business become the distributor of Atari games across Japan. Nakamura, already planning global expansion following his company's success, agreed to the deal. In part due to employee theft, Atari Japan was a financial disaster and nearly collapsed in its first few years of operation.
When Takumi stopped showing up to work, the company was handed to Hideyuki Nakajima, a former employee of the Japan Art Paper Company. Atari co-founder Nolan Bushnell, whose company was already struggling in America, chose to sell the Japanese division. His fixer, Ron Gordon, was given the task of finding the buyer for Atari Japan. After being turned down by Sega and Taito, Gordon's offer was accepted by Nakamura for ¥296 million ($1.18M), though Nakamura informed Bushnell his company was unable to pay the money by the deadline. With no other takers for Atari Japan, Bushnell ultimately allowed Nakamura to only pay $550,000 and then $250,000 a year for three years. The acquisition allowed Nakamura Seisakusho to distribute Atari games across Japan, and would make it one of the country's largest arcade game companies.
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The Atari Japan purchase was not an immediate success, in part due to the medal game fad of the 1970s. While Nakamura Seisakusho saw some success with imports such as Kee Games's Tank, the Japanese video game industry's decrease in popularity did not make them as profitable as hoped. The market became more viable once restrictions on medal games were imposed by the Japanese government in 1976, as Nakamura Seisakusho began returning higher profits; its import of Atari's Breakout was so successful that it led to rampant piracy in the industry. By the end of the year, Nakamura Seisakusho was one of Japan's leading video game companies.
Galaxian, Pac-Man, and arcade success (1977–1984)
Nakamura Seisakusho changed its corporate name to Namco in June 1977. It opened a division in Hong Kong named Namco Enterprises Asia, which maintained video arcades and amusement centers. As Namco's presence in Japan was steadily rising, Nakajima suggested to Nakamura that he open a division in the United States to increase worldwide brand awareness. Nakamura agreed to the proposal, and on September 1, 1978, established Namco-America in Sunnyvale, California. With Nakajima as its president and Satashi Bhutani as vice president, Namco-America's aim was to import games and license them to companies such as Atari and Bally Manufacturing. Namco-America would release a few non-video arcade games itself, such as Shoot Away (1977).
As the video game industry prospered in Japan during the 1970s with the release of Taito's Space Invaders, Namco turned its attention towards making its own video games. While its licensed Atari games were still profitable, sales were decreasing and the quality of the hardware used began deteriorating. Per the recommendation of company engineer Shigekazu Ishimura, the company retrofitted its Ōta manufacturing facility into a small game division and purchased old stock computers from NEC for employees to study.
Namco released Gee Bee, its first original game, in October 1978. Designed by new hire Toru Iwatani, it is a video pinball game that incorporates elements from Breakout and similar "block breaker" clones. Though Gee Bee fell short of the company's sales expectations and was unable to compete with games such as Space Invaders, it allowed Namco to gain a stronger foothold in the video game market.
In 1979, Namco published its first major hit Galaxian, one of the first video games to incorporate RGB color graphics, score bonuses, and a tilemap hardware model. Galaxian is considered historically important for these innovations, and for its mechanics building off those in Space Invaders. It was released in North America by Midway Manufacturing, the video game division of Bally, where it became one of its best-selling games and formed a relationship between Midway and Namco.
The space shooter genre became ubiquitous by the end of the decade, with games such as Galaxian and Space Invaders becoming commonplace in Japanese amusement centers. As video games often depicted the killing of enemies and shooting of targets, the industry possessed a predominately male playerbase. Toru Iwatani began work on a maze video game that was targeted primarily towards women, with simplistic gameplay and recognizable characters. Alongside a small team, he created a game named Puck Man, where players controlled a character that had to eat dots in an enclosed maze while avoiding four ghosts that pursued them.
Iwatani based the gameplay off eating and designed its characters with soft colors and simplistic facial features. Puck Man was test-marketed in Japan on May 22, 1980 and given a wide-scale release in July. It was only a modest success; players were more accustomed to the shooting gameplay of Galaxian as opposed to Puck Man's visually distinctive characters and gameplay style. In North America, it was released as Pac-Man in November 1980. Pac-Man's simplicity and abstract characters made it a fixture in popular culture, spawning a multi-million-selling media franchise.
Namco regularly released several successful games throughout the early 1980s. It published Galaga, the follow-up to Galaxian, in 1981 to critical acclaim, usurping its predecessor in popularity with its fast-paced action and power-ups. 1982 saw the release of Pole Position, a racing game that is the first to use a real racetrack (the Fuji Speedway) and helped laydown the foundations for the racing genre. It released Dig Dug the same year, a maze chaser that allowed players to create their own mazes.
Namco's biggest post-Pac-Man success was the vertical-scrolling shooter Xevious in 1983, designed by new-hire Masanobu Endō. Xevious's early usage of pre-rendered visuals, boss fights, and a cohesive world made it an astounding success in Japan, recording record-breaking sales figures that had not been seen since Space Invaders. The game's success led to merchandise, tournament play, and the first video game soundtrack album. The same year, Namco released Mappy, an early side-scrolling platformer, and the Pole Position sequel Pole Position II.
Endō went on to design The Tower of Druaga a year later, a maze game that helped establish the concept for the action role-playing game. Druaga's design influenced games such as Nintendo's The Legend of Zelda. 1984 also saw the release of Pac-Land, a Pac-Man-themed platform game that paved the way for similar games such as Super Mario Bros., and Gaplus, a moderately successful update to Galaga. The success of Namco's arcade games prompted it to launch its own print publication, Namco Community Magazine NG, to allow its fans to connect with developers.
Success with home consoles (1984–1989)
In July 1983, Nintendo released the Family Computer, a video game console that utilized interchangeable cartridges to play games. The console's launch came with ports of some of Nintendo's popular arcade games, like Donkey Kong, which at the time were considered high quality. Though Namco recognized the system's potential to allow consumers to play accurate versions of its games, the company chose to hold off on the idea after its ports for platforms such as the Sord M5 flopped. Nakamura suggested that his son-in-law, Shigeichi Ishimura, work with a team to reverse-engineer and study the Famicom's hardware in the meantime.
His team created a conversion of Galaxian with their newfound knowledge of the console's capabilities, which exceeded the quality of previous home releases. The port was presented to Nintendo president Hiroshi Yamauchi alongside notification that Namco intended to release it with or without Nintendo's approval. Namco's demonstration was the impetus for Nintendo's decision to create a licensing program for the console. Namco signed a five-year royalties contract that included several preferential terms, such as the ability to produce its own cartridges.
A subsidiary named Namcot was established in 1984 to act as Namco's console game division. According to former Namco video game music composer Norio Nakagata, "T" means "Tomorrow" and was capitalised for emphasis. Tomorrow was derived from EPCOT (Experimental Prototype Community of Tomorrow). It released its first four games in September: Galaxian, Pac-Man, Xevious, and Mappy. Xevious sold over 1.5 million copies and became the Famicom's first "killer app". Namcot also began releasing games for the MSX, a popular Japanese computer. Namco's arcade game ports were considered high-quality and helped increase sales of the console.
Namcot was financially successful and became an important pillar within the company; when Namco moved its headquarters to Ōta, Tokyo in 1985, it used the profits generated from the Famicom conversion of Xevious to fund its construction (the building was nicknamed "Xevious" as a result). The Talking Aid, a speech impairment device, was part of the company's attempts in venturing into other markets.
By the time the video game crash of 1983 concluded in 1985 with the release of the Nintendo Entertainment System (NES), Atari had effectively collapsed. After enduring numerous financial difficulties and losing its control in the industry, parent Warner Communications sold the company's personal computer and home console divisions to Commodore International founder Jack Tramiel, who renamed his company Tramel Technology to Atari Corporation. Warner was left with Atari's arcade game and computer software divisions, which it renamed Atari Games. Namco America purchased a 60% stake in Atari Games on February 4, 1985, through its AT Games subsidiary, with Warner holding the remaining 40%. The acquisition gave Namco the exclusive rights to distribute Atari games in Japan.
Nakamura began losing interest and patience in Atari Games not long after the acquisition. As he started viewing Atari as a competitor to Namco, he was hesitant to pour additional funds and resources into the company. Nakamura also disliked having to share ownership with Warner Communications. Nakajima grew frustrated with Nakamura's attempts at marketing Atari video games in Japan, and had constant disagreements with him over which direction to take the company. Viewing the majority-acquisition as a failure, in 1987 Namco America sold 33% of its ownership stake to a group of Atari Games employees led by Nakajima.
This prompted Nakajima to resign from Namco America and become president of Atari Games. He established Tengen, a publisher that challenged Nintendo's licensing restrictions for the NES by selling several unlicensed games, which included ports of Namco arcade games. Though its selloff made Atari Games an independent entity, Namco still held a minority stake in the company and Nakamura retained his position as its board chairman until the middle of 1988.
In Japan, Namco continued to see expeditious growth. It published Pro Baseball: Family Stadium for the Famicom, which was critically acclaimed and sold over 2.5 million copies. Its sequel, Pro Baseball: Family Stadium '87, sold an additional two million. In 1986, Namco entered the restaurant industry by acquiring the Italian Tomato café chain. It also released Sweet Land, a popular candy-themed prize machine.
One of Namco's biggest hits from the era was the racing game Final Lap from 1987. It is credited as the first arcade game to allow multiple machines to be connected—or "linked"—together to allow for additional players. Final Lap was one of the most-profitable coin-operated games of the era in Japan, remaining towards the top of sales charts for the rest of the decade.
Namco's continued success in arcades provided its arcade division with the revenue and resources needed to fund its research and development (R&D) departments. Among their first creations was the helicopter shooter Metal Hawk in 1988, fitted in a motion simulator arcade cabinet. Its high development costs prevented it from being mass-produced. While most of its efforts were commercially unsuccessful, Namco grew interested in motion-based arcade games and began designing those at a larger scale. In 1988, Namco became involved in film production when it distributed the film Mirai Ninja in theaters, with a tie-in video game coinciding with its release.
Namco also developed the beat 'em up Splatterhouse, which attracted attention for its fixture on gore and dismemberment, and Gator Panic, a derivative of Whack-a-Mole that became a mainstay in Japanese arcades and entertainment centers. In early 1989, Namco unveiled its System 21 arcade system, one of the earliest arcade boards to utilize true 3D polygonal graphics. Nicknamed "Polygonizer", the company demonstrated its power through the Formula One racer Winning Run.
With an arcade cabinet that shook and swayed the player as they drove, the game was seen as "a breakthrough product in term of programming technique" and garnered significant attention from the press. Winning Run was commercially successful, convincing Namco to continue researching 3D video game hardware. Video arcades under the Namco banner continued opening up in Japan and overseas, such as the family-friendly Play City Carrot chain.
Expansion into other markets (1989–1994)
Namco saw continued success in the consumer game market as a result of the "Famicom boom" in the late 1980s. By 1989, sales of games for the Famicom and NES accounted for 40% of its annual revenue. During the same time frame, the company's licensing contract with Nintendo expired; when Namco attempted to renew its license, Nintendo chose to revoke many of the preferential terms it originally possessed. Hiroshi Yamauchi insisted that all companies, including Namco, had to follow the same guidelines.
The revocation of Namco's terms enraged Nakamura, who announced the company would abandon Nintendo hardware and focus on production of games for competing systems such as the PC Engine. Executives resisted the idea, fearing it would severely impact the company financially. Against Nakamura's protest, Namco signed Nintendo's new licensee contract anyway. While it continued to produce games for Nintendo hardware, most of Namco's quality releases came from the PC Engine and Mega Drive.
In 1989, it was reported that Namco was underway with developing its own video game console to compete against companies such as Nintendo and NEC. Electronic Gaming Monthly claimed that the system, which was nearing completion, featured hardware comparable to the then-upcoming Nintendo Super Famicom. According to company engineer Yutaka Isokawa, it was produced to compete against the Mega Drive, a 16-bit console by Namco's arcade rival Sega. With the console industry being crowded by other competing systems, publications were unsure how well it would perform in the market. While the console was never released, it allowed Namco to familiarize itself with designing home video game hardware.
Tadashi Manabe replaced Nakamura as president of Namco on May 2, 1990. Manabe, who had been the company's representative director since 1981, was tasked with strengthening relationships and teamwork ethics of management. Two months later, the company dissolved its remaining connections with Atari Games when Time Warner reacquired Namco America's remaining 40% stake in Atari Games. In return, Namco America was given Atari's video arcade management division, Atari Operations, allowing the company to operate video arcades across the United States. Namco began distributing games in North America directly from its US office, rather than through Atari.
Namco Hometek was established as the home console game division of Namco America; the latter's relations with Atari Games and Tengen made the company ineligible to become a Nintendo third-party licensee, instead relying on publishers such as Bandai to release its games in North America. In Japan, Namco developed two theme park attractions, which were demonstrated at the 1990 International Garden and Greenery Exposition (Expo '90): Galaxian3: Project Dragoon, a 3D rail shooter that supported 28 players, and a dark ride based on The Tower of Druaga.
From Wikipedia’s article on Namco, shared under CC BY-SA 4.0.3