The Third Wave: An Entrepreneur's Vision of the Future Read Online Free

called GameLine. The idea was to make a game cartridge, much like Atari’s, but with a cord to connect it to a phone line so you could download and play games for a monthly fee (a primitive Netflix for games).
    By January 1983, Marc and Bill were fully in the video game business, and ready to announce their new service. They did so at the Consumer Electronics Show in Las Vegas, tethering a massive hot-air balloon to the roof of the Tropicana, emblazonedwith the GameLine logo. I joined the company full-time nine months later, just as the product was coming to market.
    It was an utter disaster.
    Atari video games turned out to be a fad. After a few go-go growth years, interest in Atari products plummeted. Retailers canceled their GameLine orders. Inventory piled up. (One weekend, we quietly disposed of the tens of thousands of unsold GameLine modems in a dumpster behind our office.) GameLine’s revenues were 95 percent below forecasts, so the CVC board decided to slash costs. Most of the staff lost their jobs. I went from being the youngest person on a seven-person marketing team to being the only one left in the department—mostly, I suspect, because I had the lowest salary. My parents were pretty worried. I’d had three jobs in three years, and now it looked like I would soon need another.
    The experience was an early lesson in market timing and managing costs, and a valuable first experience with failure. But while GameLine’s demise was agonizing and shocking, I wasn’t discouraged. My hopes for GameLine had deflated, but my conviction about the digital future remained. I was confident, perhaps naïvely so, that we would figure something out.
    To stave off bankruptcy, we sought partners. As an accidental senior leader in the company, I wound up with the job of striking deals wherever I could to keep the company afloat. After dozens of fruitless conversations, we finally made a deal with BellSouth, which had just recently divested from “Ma Bell” (the AT&T Corporation) after an antitrust ruling brokeup the phone company. BellSouth provided some funding that kept CVC going for another year, but it became increasingly clear that our strategy of using a customized modem technology had been a mistake.
    By the time we entered the market, our technology was outdated. What we’d engineered was a modem technology that was, in essence, download-only. We could send games to consumers, but consumers couldn’t send much data back to us—or to one another. The modems that people were starting to purchase could do both. What we thought was CVC’s core asset—a lower-cost modem technology—turned into one of its greatest liabilities. We offered a proprietary system that few wanted to adopt.
THE (FIRST) REBOOT
    So we decided to abandon it and support industry-standard modem technology and the emerging personal computer market instead. We embraced the irony—a modem company with a worthless modem—and we reminded ourselves that we’d never intended to be a hardware company at all. The modem was a means to the real end: becoming a consumer online service company. So we returned to our original mission and exited the hardware business altogether. Instead, we put all of our efforts into what we were good at: crafting easy-to-use software and services that could demystify the online world.
    We also decided to rethink our marketing and distributionstrategy. Rather than selling services directly to consumers, which was both costly and risky, we decided to partner with personal computer manufacturers to create private-label online services, which they in turn could sell to their customers. We’d build the software and services, they’d package and market them, and we’d share in the revenue.
    In theory, it made great sense, and we were excited to get started. But as soon as we began reaching out to potential partners, we realized we had a problem. We kept getting brushed off. Some thought the appeal of getting online would be