Mario’s 25th – Interview with Craig Douglass

Fei Wong is the newest addition to the Padinga family.

As we celebrate 2010 we cannot overlook the obvious fact that it is the 2010th anniversary of Christ’s birth [Editor's Note:  ;)].  The same could be said of all 2009 years prior and all years subsequent.  But I’m not here to talk about the savior of the world, I’m here to talk about the saviors of the video game industry: the Super Mario Brothers.

Yes in a year when people were lining up to see a movie about 2012 that had been advertised since 2009, enlightened gamers remember 2010 as the celebration of the 25th anniversary of Super Mario Bros and the North American Release of the Nintendo Entertainment System.

Yes while 2012 celebrates destruction, 2010 celebrates invention…a quarter century of it.  And in video game culture, a quarter is a lucky number, representing the intersection of entertainment and entrepreneurship, fun and frugality.  Was not the video game industry built a quarter at a time?

Some people will argue that Mario and Luigi weren’t born in America, which is undoubtedly true.  But the same can be said of Andrew Carnegie, Arnold Schwarzenegger, Piolin, Obama’s father and a host of other immigrants who found their greatest success in America.  The Mario Brothers are no different.

Yes for the last 25 years Mario and Luigi Mario, collectively known as the Mario Bros, have remained at the forefront of the gaming industry, with Mario easily its most recognizable and celebrated figure.  They are so intrinsically a part of American culture that in the 1990s, perhaps the peak of Mario Mania, a national survey found that Mario was more recognizable to American children than the identically initialed Mickey Mouse.  It’s hard to remember that Mario and Luigi are in fact…immigrants.

Yes, Mario and Luigi Mario’s are one of America’s greatest immigration stories.  And while they crossed an ocean, not a river, to come to America, their story takes place just north of the Mexican border smack dab in the middle of the 2010 immigration battle:  Arizona.

1985

The year was 1985 and Nintendo had finally fixed all the initial technical hiccups with their Japanese 8-bit home console system, the Famicom, and turned it into the number one home video game console in Japan.  With his domestic market secured, Hiroshi Yamauchi, the emperor of Nintendo, turned his eyes eastward to America.

Having grown up during the 1920s in Japan, Yamauchi was no stranger to the expansion of empire and had long harbored ambitions for the American market.  In the wake of the video game crash of 1977, caused by an oversaturation of the hardware and software market, Yamauchi saw opportunity.  Broadly speaking, the American market’s instability was the sign of two weaknesses upon which Nintendo could capitalize.  The first weakness was the crowding of the market which in addition to dividing the consumer base also demonstrated that the American market had not been monopolized in the way that Microsoft would soon do in the 1990s.  The second weakness was the poor quality of games, which played to Nintendo’s century-long reputation as a maker of quality games.  Thus in 1980 he offered his son-in-law, Minoru Arakawa, the opportunity to found Nintendo of America.  They settled upon Redmond, Washington as their headquarters.

Nintendo of America’s unofficial motto was: The Name of the Game is the Game And that game was Super Mario Bros.  Mario’s starring role in Shigeru Miyamoto’s 1981 hit Donkey Kong and his co-starring role with his brother Luigi in Mario Bros in 1983  made them a natural choice as the pack-in-game. Choosing the game was easy, selling it was a different matter.

No one knew this better than Craig Douglass, a rising star in Mel Pearson Company in charge of Nintendo’s distribution in the Southwest, Idaho, Montana and Wyoming.  Today such an assignment would be met with celebration and thanks, but back in 1985 the Nintendo Entertainment System was looked upon as something of a hot potato.  This is almost unimaginable today given Nintendo’s current dominance in both the handheld and home console markets.  But in 1985 the home video game console industry was as barren as the Arizona desert in which Nintendo’s Southwest USA distributor was headquartered.  Douglass loved the Italian Plumbers who reminded him of Laurel and Hardy in Overalls.  But secretly he feared his two new friends would end up buried somewhere in the Sonoran desert.  After all, he remembered, isn’t that what happened in Alamogordo, New Mexico back in ’83?

1983…

Not much happens around Alamogordo, New Mexico, a small city of 30,000 people, half of whom are employed by the US Air Force.  Every 40 years, however, the monotony is broken by a cataclysm of global proportions.  What else can you call the detonation of the world’s first atomic bomb: Trinity?

Most people identify Trinity with Los Alamos Air Force Base, which was the home of the Manhattan Project that produced the bomb.  While Trinity was built in Los Alamos, it was first tested in Alamogordo’s backyard: the White Sands Proving Ground in July 16, 1945.  Three weeks later similar bombs were regrettably and tragically used on the civilian populations of Hiroshima and Nagasaki on August 6th and August 9th, 1945.

Just 30 days after the Trinity Testing outside Alamogordo, Japan surrendered to the Allies on August 15th, 1945.  This surrender ended future Nintendo President Hiroshi Yamauchi’s consignment as a military factory worker and he immediately applied and was accepted to Waseda University before the end of 1945.  Here he would study law and develop the negotiating skills that would allow Nintendo’s global popularization of home video gaming in 1985…

In 1983, Alamogordo would become home to another American development that would also have enormous impact to Yamauchi and the world economy.  New Mexico, already known as the Bermuda triangle of extra-terrestrial travel, was about to put itself on the map for another high-profile extra-terrestrial cover-up.  Make that burial.

In the September,1983 the New York Times covered a story revealing that an Atari warehouse in El Paso, Texas was dumping and burying its surplus of millions of unsold video games in Alamagordo, New Mexico.  Chief among these was the highly-marketed, overly-produced and undersold E.T: The Video game.  Rushed to the market in December 1982, it was marketed with almost as much gusto as the movie upon which it was based.   Yet ET was widely panned by critics and gamers and to this day is known as one of the worst games ever made.

The burial of these games during the hot summer of 1983 was really the burial of not only Atari but the entire nascent American videogame industry.  American companies like Magnavision, Colecovision and market leader Atari were the original pioneers of the home video game console industry and survivors of the 1977 videogame crash.  They created the market that has outperformed Hollywood since 1999.  Yet they were pioneers that fell off the wagon: the industry they created was a wild wild west and like cowboys third-party software companies sprang up overnight to ride the bull market.  The 1983 collapse of the American video game market ultimately happened because of the poor quality of the games that were created.  The high-profile disappointment of ET was the nail in the coffin.

Atari’s original distributor abandoned ship and in its place, sales and distribution head Donald Kingsborough brought on Mel Pearson in 1983.  Craig Douglass, then a rising star in Arizona marketing company was personally assigned to untangle the financial travails Atari had found itself in.  Together with Atari Sales and Distribution Head Don Kingsborough they attempted various methods of dealing with the overstock of Atari software sitting on retailers’ shelves.  One method even included an attempt to buy back copies in exchange for a retailers’ guarantee to buy back two more.  Despite their best efforts, retailers like Toys R’US, Walmart and Gemco lost millions.  For, Craig Douglass, the experience of selling an unsellable product was one he would never forget.

1984

The following year Atari was sold and Kingsborough exited the company to form Worlds of Wonder, famous for their Teddy Ruxpin and Lazer Tag toys.  Along with him he brought several senior members of Atari and kept the entire distribution network he had developed at Atari.

Given this turmoil it is no wonder that Minoru Arakwa’s proposed distribution arrangement with Atari for the Famicom never materialized.   Yet Arakawa continued to speak to Kingsborough who suggested he use World of Wonder’s network of distributors for Nintendo of America.  This included Mel Pearson for Nintendo’s Southwest operations.  Craig Douglass had a chance at redemption, and the Super Mario Bros were going to help him realize it.

1985

Eager to avoid the stigma Atari had left in the retailers mouths, Nintendo renamed the product the Nintendo Entertainment System in an effort to avoid association with the game consoles.   At the same time they sent beta copies of the system along with the pack-in game of Super Mario Bros and Duck Hunt to Mel Pearson in Phoenix.  It was understood that Super Mario Bros would be the showcase game and Mario the mascot of not just that game but the entire company.

Taking the beta copies home he buried himself in the living room examining the product he would soon be selling.  As Douglass would soon find out, taking home his work would never be quite the same.  He immediately fell in love with the Super Mario Bros.  Having represented Atari, he was amazed by the crisp detailed graphics, the catchy temp music, the well-calibrated gameplay and engaging level design.  His son became his first successful sell, and the group of neighborhood kids he regularly invited over to try the constantly changing beta copies became his second, third, fourth, fifth and sixth.  Douglass took this as a sign of good faith.  After all, America had accepted large waves of legal Italian immigration before, couldn’t it accept two hard working plumbers?

Still, retailers were hostile at the very mention of video games.  Some vented their lingering frustration at Atari towards Douglass, even chasing him out of the office during meetings.  Finally, Nintendo, eager to do a test market, took the drastic step of guaranteeing retailers in New York City and Los Angeles a guaranteed sale.  Whatever they didn’t sell Nintendo would buy back.   With such a great deal retailers like Gemco in Los Angeles agreed to carry the Nintendo Entertainment System on their shelves.  With Nintendo’s foot finally in the door, the Super Mario Bros did the rest, selling very well in Los Angeles and New York City.  Now retailers nationwide were finally read to listen to men like Douglass.  Mission almost accomplished.

A few months before the launch date of the Nintendo Entertainment System, Douglass invited his SAE Fraternity Brothers and fellow water polo players from Cal State LA to catch-up.  It had been a few years since college and they were due for a reunion.

Craig had seen his 4-year-old son Bradley and kindergarten friends pass Super Mario Bros.  Being a generous father, he let his child do most of the playing and he most of the observing.  That afternoon in Phoenix, Douglass’ wife bet the boys that they wouldn’t be able to what little Bradley and his 4-year old friends had done: Beat Super Mario Bros.

As members of the Cal State LA Water Polo team, they were used to playing a game that no one else cared about or understood, let alone a Japanese game starring Italian plumbing brothers and princess kidnapping turtles.  Without thinking, they took the bet.  The beta copy they were playing was in Japanese as were the instructions.  Starting in the afternoon they progressed level by level without taking so much as a warp pipe.  Finally at 2 in the morning, they arrived at Bowser’s castle in world 8-4.  After a couple of failed attempts, and plodding slow progress, they ran underneath Bowser, dropped him into the lake of fire and saved Princess Toadstool.  Their honor upheld, they crashed.

Fortunately for Craig Douglass, the Nintendo Entertainment System never crashed, but instead revitalized the American video game console market, restoring gamers and retailers’ faith in video gaming.  It was the beginning of a long relationship between Douglass and Nintendo.  Douglass’ success with Nintendo launched his career and provided a very comfortable lifestyle for his wife, two kids one house and dog.  For him, the American lifestyle had come at the gumption of two Italian-immigrant plumbers from Japan.

Douglass’ company, now named Pearson Southwest, maintained their relationship with Nintendo until 1999.  At this point, Nintendo hired and created its own internal sales team for North America.  The loss was a disappointing for Pearson Southwest and ended the era of Nintendo’s independent distribution networks.  Yet it was a move that reflected the growth of not only Nintendo but the entire industry it had built: this was also the year that the video game industry outperformed Hollywood, a trend that continues to this day.

For Craig Douglass, a man who has seen the industry before and after Nintendo, the industry’s failure and success hinges upon the motto he learned from Nintendo of America back in the 1980s:  The Name of the Game is the Game.  And that game was and still is Super Mario Bros.

Happy Birthday Super Mario Bros, Mission Accomplished.