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Magnavox, along with Sanders Associates, would eventually sue Atari for copyright infringement. Atari settled and became an Odyssey licensee; over the next 20 years, Magnavox went on to win more than $100 million in copyright lawsuits related to the Odyssey and its video game patents.
In 1977, Atari released the Atari 2600 (also known as the Video Computer System), a home console that featured joysticks and interchangeable game cartridges that played multi-colored games, effectively kicking off the second generation of the video game consoles.
The video game industry had a few notable milestones in the late 1970s and early 1980s, including:
The release of the Space Invaders arcade game in 1978
The launch of Activision, the first third-party game developer (which develops software without making consoles or arcade cabinets), in 1979
The introduction to the United States of Japan’s hugely popular Pac-Man
Nintendo’s creation of Donkey Kong, which introduced the world to the character Mario
Microsoft’s release of its first Flight Simulator game