The Atari company started a global phenomenon. For millions of people worldwide, video games (see entry under 1970s—Sports and Games in volume 4)—played at home, in arcades, or using portable devices—are an entertaining part of everyday life. In the 1970s, Atari paved the way for the video-game giants of later years, like Nintendo and Sega.

Teens compete for the top score in Asteroids, one of Atari's popular arcade games. AP/Wide World Photos. Reproduced by permission.

Atari was founded in 1972 by Nolan Bushnell (1943–), an engineer who believed electronics could be adapted for entertainment. He invented the first video-game machine, Pong (see entry under 1970s—Sports and Games in volume 4). The electronic version of ping-pong became a huge hit in bars and arcades. Together with some friends, Bushnell created a company to market it. They called their company "Atari," after a word used in the popular Japanese...