Video Games Go Crunch!

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But Dirk will have rivals in the arcades. Data East USA has begun shipping a laser videodisc game called Bega's Battle, in which a superhero must save the world from destruction by fending off fireballs and dragons. Also expected to reach the arcades soon is Mylstar Electronics' M.A.C.H. 3, which stands for Military Air Command Hunter. The game puts the player in the cockpit of a fighter or bomber, and the laser disc projects film footage of terrain passing below, while the computer generates graphics representing enemy tanks, bridges and factories, which the pilot tries to destroy.

Coleco has bought the rights to produce a home version of Dragon's Lair and hopes to have it ready some time next year. Some companies, however, think the technology of bringing laser videodisc games into the home may be tricky. Says Parker Bros.' Stearns: "We very much want to participate in the laser videodisc market, and we're exploring it. But to rush headlong into this area when the hardware hasn't been perfected would be foolish."

Video-game enthusiasts contend that the industry is in its infancy, like Hollywood in the silent-movie era. Says Clive Smith, an electronics-industry expert at the Yankee Group consulting firm in Boston: "The previous generation of video games was primitive compared with what is coming. This is not a fad. Interactive electronic entertainment is here to stay." Smith thinks that the wizards behind the special effects in today's movies could become the star video-game designers of tomorrow. If that happens, he says, the games will be "very, very lucrative."

Maybe so, but for now the industry faces a rough passage through perilous times. With dozens of companies trying to make the journey, the casualties are bound to be heavy.

—By Charles P. Alexander. Reported by Lisa Towle/Boston and Richard Woodbury/Los Angeles

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