In 1983
Martin Alper, Frank Herman (died 2009), Terry Medway and Alan Sharam founded the computer game publishing company Mastertronic. Another key figure at the time was ex-Notts Cricket batsman
Richard Bielby, who ran a distribution network servicing a large number of small retailers. The first game was
The Last V8 and many more were soon to follow including
Knight Tyme and
180.
Martin Alper, who had the most marketing flair, went to the United States in 1986 to set up Mastertronic Inc. The
UK company was managed by Frank Herman, whilst Alan Sharam increasingly specialised in sales and
logistics (
warehousing, packaging, controlling production schedules). As the business continued to grow Mastertronic created another label in 1986,
Entertainment USA, when it began working closely with several American writers including
Sculptured Software and Randall Masteller. They wanted an outlet to sell games to the UK market, and so Mastertronic moved in, often using
Rob Hubbard or
David Whittaker to re-do the music. In 1987 Mastertronic decided to expand its distribution of software and began exporting titles back across the
Atlantic, so the label
Bulldog was created primarily to distribute the 'Best of British' games in the US (The name Bulldog actually came from a small wholesaler called Bulldog Distribution who got into financial difficulties and was taken over the previous year). Several other labels were invented for other publishers who wanted it to re-issue their old full price product at budget prices, such as
Rack-it for
Hewson and
Americana for
U.S. Gold. Their re-release label
Ricochet was created in 1987 A buyout of
Melbourne House when that label was struggling with financial problems enabled it to add games such as
The Way of the Exploding Fist to its re-release catalogue.
Video and music In March 1987 Mastertronic launched the short-lived
Master Vision and
Master Sound labels, with an aim of releasing low priced video and music cassettes. During the brief life-span of the company, the only notable releases were the films
Creepshow and
The Exterminator.
Arcadia Systems In 1987, Mastertronic started a venture to develop arcade games under the name
Arcadia. The intent was that the hardware would be based around the chipset from Commodore's
Amiga computers, and that the same game could run on both Arcadia hardware and home systems, reducing development cost. However, Arcadia was a failure; according to Mastertronic's then-financial controller, Anthony Guter, the games were of poor quality and not suited to arcade-style play. Guter noted that while those within Mastertronic who played games were aware of the difference in style between arcade and home games, the directors in charge of the company were not. According to Guter, Arcadia's failure nearly bankrupted the company.
Merger with Virgin Having bought Melbourne House and with heavy financial commitments to the Arcadia project Mastertronic (now renamed the 'Mastertronic Group Ltd') was now suffering severe
cash flow problems.
Virgin stepped in and purchased the 45% of shares held by the outside investment group. The remaining 55% was held by Alper (25%), Herman (20%) and Sharam (10%) until 1988 when they sold out in a highly complex deal which required their continuing involvement in the business and achievement of profit and cash flow targets. The merger created
Virgin Mastertronic although the company would continue to publish titles under the Mastertronic, Melbourne House and Virgin Games labels for several more years. It was Frank Herman who, in early 1987, spotted that
Sega had no UK distributor for the
Master System range. Mastertronic sold all they could get that year and were then appointed as distributors in France and Germany as well, and thus Sega Europe was born.
Sega takeover Soon after the completion of the merger all the marketing effort went into full-price games under the Melbourne House label and it was clear that the budget side was sliding into oblivion, the competition had become intense as everyone was recycling their old full-price games as budget games. In addition, the children who used to buy
8-bit computers were now buying
Sega and
Nintendo consoles. Sega sales were booming so much that nobody really cared about the traditional Mastertronic business. Although staff recruitment actually rose, this was all for the Sega operations. By 1991 nearly all the company's turnover, and certainly all the profit, came from Sega-related business. As a result, nearly all the staff moved over to Sega when they took over the business from Virgin and only a handful of game programmers stayed with the publishing side (quickly renamed
Virgin Interactive Entertainment). After the Sega takeover Frank became deputy Managing Director of Sega Europe and Alan was Managing Director of Sega UK. Martin left the UK and became a resident in the US. == Influence on the industry ==