Atari's E.T.: five weeks of development, four million cartridges — and a landfill

E.T. the Extra-Terrestrial — Atari's licensed tie-in to Steven Spielberg's blockbuster film — was the product of a rushed deal: rights negotiations ended in late July 1982, leaving programmer Howard Scott Warshaw about five weeks to write the game for the Christmas season. Atari reportedly paid $20–25 million for the license and produced an initial run of four million cartridges.

The game was panned by players who found it confusing and broken, and the unsold stock came back: Atari's president said roughly 3.5 million of the four million cartridges were returned as unsold inventory or customer returns, despite more than 2.6 million selling by the end of 1982.

In September 1983, Atari crushed and buried truckloads of unsold product — later counted at 728,000 cartridges, not all E.T. — under concrete in an Alamogordo, New Mexico landfill; the 2014 excavation confirmed the story. The failure contributed to parent Warner Communications reporting $310 million in losses by the second quarter of 1983, and it became the emblem of the video game crash.