History

• The first video game system to be released for the home market was the Magnavox Odyssey, which came out in 1972. The more successful Atari Pong console followed in 1975, and similar products and knockoffs would follow in the next few years. These early consoles came pre-programmed with games; unlike modern consoles, new games could not be played on these early consoles.
  
  

Cartridge Gaming

• The history of consoles changed significantly in 1976, with the release of the Fairchild Channel F console. This was the first video game system that could load games from a cartridge, which allowed games to be developed for the console after the initial release. The more successful Atari 2600 also had this feature. To take advantage of the popularity of the Atari, third-party companies flooded the market with cheap, low-quality games that turned off buyers. This caused the video game industry to crash as a whole in 1983.
  
  

Rise of Nintendo

• In 1983, the Nintendo Entertainment System (NES) was released successfully in Japan. Nintendo believed that the NES could be successful in North America if it could get past the stigma of it being a "video game system." The solution was to market it as an "entertainment system" instead. This marketing strategy worked--the NES was a massive hit--and it gave Nintendo an almost total monopoly over the video game console industry in the mid-to-late 1980s.
  
  

Competition

• Nintendo was so confident in their market superiority that they virtually ignored other companies that were introducing more technologically advanced systems. The Sega Genesis was the first console to successfully achieve high enough sales to effectively break up Nintendo's monopoly. The Sony PlayStation, released in 1994, was the first console to outsell a Nintendo's console, the GameCube. Sony continued to climb in the industry with the Playstation 2 (released in 2000), which is one of the best-selling systems of all time. The Microsoft Xbox, released in 2001, also was able to compete successfully with Nintendo and Sony.
  
  

Modern Consoles

• Nintendo has once again reestablished market dominance in 2010 with the Nintendo Wii, outselling both the Sony PlayStation 3 and the Microsoft Xbox 360, which is the sequel to the original Xbox. The lower price tag of the Wii and heavy marketing towards casual gamers have been the main reasons for this success. Microsoft and Sony have both maintained strong enough sales for their respective consoles to be considered successful as well.