Atari Shock
Noun · Hacker Culture
Definitions
The North American video game market crash of 1983, triggered by an oversaturation of low-quality titles — epitomized by the infamous E.T. the Extra-Terrestrial cartridge — that caused industry revenues to drop roughly 97% and nearly killed console gaming until Nintendo revived it with the NES in 1985. The Japanese term 'Atari Shock' emphasizes the sudden impact on the market.
In plain English: The 1983 collapse of the American video game industry caused by too many terrible games flooding the market, nearly destroying the entire business.
Example: "Every time someone says the indie game market is oversaturated, someone else brings up the Atari Shock as a cautionary tale."