Atari U.S. Files Chapter 11 Bankruptcy

By Dog of Thunder, 3 years ago
When I was away this weekend on vacation, community suggestions came pouring in saying "Atari has filed for bankruptcy", "Atari to close its doors!", "End of an era!" until more information came out regarding the proceedings and it quickly became clear that this is not a bankruptcy such as the slow implosion of THQ. Here is what Atari's U.S. branch is up to with this business move and exactly what it means for you, the gamer.

Atari was bought out in 2008 by Infogrames, a successful French developer. The problem with this merger has been a difference of philosophy between the U.S. branch of Atari and Infogrames, now known as Atari S.A., as the parent company wanted a continued focus on retail titles, but Atari's U.S. branch wanted to focus on mobile and digital games, which have been a tremondous source of profit over the past two years. Why then, you are likely wondering, would a company turning a healthy profit decide to file for bankruptcy?

This Chapter 11 filing is an aggressive means for the U.S. branch of Atari and the affiliated subsidiaries to take back control of their own destiny. Under Atari S.A., the U.S. branch of Atari is unable to secure their own funding, which means that at the moment they move too slowly to be truly competitive in the world of mobile and digital download titles. Chapter 11 bankruptcy is commonly used by businesses with heavy debt to restructure themselves for future profitability. Atari's U.S. branch is banking on this being the case, but at the end of the day, what does this mean for you?

For starters, Atari is selling off their intellectual properties, which means the following franchises are up for sale:

Missile Command
Centipede & Millipede
Test Drive Unlimited
Backyard Sports: Rookie Rush
Yar's Revenge (Explains the recent de-listing!)

If we go by the trend established by THQ's bankruptcy regarding availability of digital titles over the XBLA marketplace, we can make the educated assumption that every XBLA and Games on Demand title that appears on this page, could be removed in the coming weeks as the IP is sold to a new owner that will love and cherish it forever.

On the bright side, Atari as a brand name is not going away and in fact, will likely come out of this Chapter 11 filing stronger than it has been in years. The catch is that it is likely we will lose a number of XBLA titles in the process. A little pain, a little gain but this is not nearly as disastrous as THQ's closing or 38 Studios tiny incident with the state of Rhode Island. The end of one era for Atari marks a new beginning.

For further reading on the fine details of a Chapter 11 bankruptcy, here's a brief yet informative summary courtesy of

For further discussion as to the future of Atari and speculation as to what is going to happen with some of the most iconic IPs in all of gaming, look no further than the comments to this article.