The first commercial video game console was the
Magnavox Odyssey, developed by a team led by
Ralph H. Baer and released commercially in 1972. It was shortly followed by the release of the
home version of Pong by
Atari Inc. in 1975 based on the arcade game. A number of
clones of both systems rushed to fill the nascent home console market and the video game industry suffered a small recession in 1977 due to this. The
Fairchild Channel F, released in 1976, was the first console to use
game cartridges, which was then used by the
Atari VCS and several other consoles of the second generation and led to a second boom in the video game industry in the United States and around the globe. During this time, Atari Inc. had been sold to
Warner Communications, and several programmers left the company and founded
Activision, becoming the first third-party developer. Activision's success led to a rush of new developers creating games without any publishing controls for these systems. The market became flooded with games, and combined with the rising popularity of the personal computer and the economic recession of the early 1980s, led to the
video game crash of 1983 in the U.S. market.
Nintendo, which had released its
Family Computer console in Japan that year, took several cautionary steps to limit game production to only licensed games, and was able to introduce it, rebranded as the Nintendo Entertainment System (NES) in 1985 into the U.S. market. The NES helped to revive the console market and gave Nintendo dominance during the late 1980s.
Sega took advantage of the newfound U.S. growth to market its
Sega Genesis against the
Super Nintendo Entertainment System in the early 1990s in the so-called "console wars" and emphasized the notion of "
bits" as a major selling point for consumers. The consumer adoption of
optical discs with larger storage capacity in the mid-1995 led many console manufactures to move away from cartridges to
CD-ROMs and later to
DVDs and other formats, with Sony's
PlayStation line introducing even more features that gave it an advantage in the market; the
PlayStation 2, released in 2000, remains the best-selling console to date with over 155 million units sold. Microsoft, fearing that the PlayStation 2 was threatening the competitive edge of the personal computer, entered the console space with its
Xbox line in 2001. Internet connectivity had become commonplace by the mid-2000s, and nearly all home consoles supported
digital distribution and online service offerings by the 2010s. With Sony and Microsoft's dominance in hardware capabilities, most other major manufacturers have since dropped out of the hardware business, but maintain a presence in the game development and licensing space. Nintendo remains the only competitor having taken a
blue ocean strategy by offering more original console concepts such as motion sensing in the
Wii and the hybrid design of the
Nintendo Switch. Within the home video game console market, the leading consoles have often been grouped into generations, consoles that were major competitors in the marketplace. There have been nine generations of consoles since the 1970s, with a new generation appearing about every five years. ==List of home video game consoles==