Console Wars Page 4

  As all these memories flooded back to Kalinske, he couldn’t help but feel a certain retroactive naturalness to the trajectory his life had taken, and recognize the confidence that had been a constant presence throughout his life. That confidence had never been more on display than in 1970, when Senator Margaret Chase Smith arranged for a series of subcommittee hearings to investigate the advertising tactics used to sell high-sugar products that were heavily fortified with vitamins and minerals. The allegation was that advertisers were attempting to create a false perception that the health hazards of such products (like cereal, juices, and candy-like chewable vitamins) were offset by the added nutrients. During the hearings, Kalinske took the stand, where he was reprimanded by Senator Smith for essentially selling candy wrapped in a flimsy excuse of good health. “So, Mr. Kalinske,” she said, pointing a finger at him. “Do you really think selling drugs to children is a good idea?”

  Kalinske knew that he was supposed to sit up there and transform himself into a fountain of apologies, but with the finger pointed in his face, he decided to opt for the truth. “I think it’s a great idea! Fifty percent of America’s children are malnourished, and, frankly, I don’t care how they get their vitamins as long as they get them. We’re helping kids stay healthy.” The room went silent. After he was dismissed from the stand, he was approached by executives from Mattel who had been watching the proceeding and were impressed with his performance. They offered him a position as product manager of their preschool business.

  Two years later, he was invited to speak with the founder and president of Mattel, and experienced his first career-defining moment. “People are saying that Barbie’s done, finished, kaput,” Ruth Handler proclaimed in her usual raspy, exasperated, yet somehow optimistic voice. “Barbie just had her first-ever down year last year. And you know what that means. In this business, once you dip, you drop and you don’t stop.” She finished her rant with a powerful but gentle nod of the head. “People are saying it’s time to kill Barbie and devote our resources to other things. What do you say?”

  An idealistic but unpolished twenty-seven-year-old Tom Kalinske stood in front of her desk, wearing a pleasant smile, as he tried to make sense of what he’d just heard. He desperately wanted to impress his boss, the living legend responsible for making Barbie the most famous plastic doll ever. To avoid saying the wrong thing, Tom continued to hide behind the shield of his smile.

  “Nope,” Ruth said, her eyes unflinching. “You don’t get to where I am without becoming fluent in the language of smiles. And that one you’ve got slapped across your face right now says, ‘I have no idea how to answer her question, so I should try to remind her that I’m handsome and charming.’ Am I right?”

  Tom chuckled, and this time he gave her a very different kind of smile.

  “Okay then, that’s much better. But just because I called you charming and handsome doesn’t mean you’re off the hot seat. Now answer the question, mister.”

  “Well, Ruth,” he said, almost surprised to hear himself sound so calm, “that’s the craziest thing I ever heard. Barbie, done? No way.” Kalinske shook his head profoundly, now controlling the room with his every word, gesture, and expression, a gift that would reveal itself to him more and more over the years. “Look, I think it’s fair to say that both you and I are in good health and seem destined to live nice long lives. And let me tell you something: Barbie will be around long after you and I are gone.”

  “Oh, is that a fact?” she asked.

  “It is,” he said confidently.

  Ruth’s eyes zeroed in on his. “What makes you so sure that people won’t get bored of a doll, albeit a fetching blond one?” A tiny smile delicately bent half of Ruth’s face. She wasn’t the only one fluent in the language of smiles, and Tom knew what it meant: genuine curiosity, with the potential for an impulsive decision.

  “They won’t get bored,” he said, “because Barbie’s not just a doll. She’s an idea, a promise to girls of all ages that you can fulfill any dream or fantasy out there. Through Barbie, a girl can be anything she wants to be!” Kalinske nodded slowly. “And yeah, it doesn’t hurt that she’s not bad-looking.”

  Ruth emphatically slapped her desk. “Great, that’s the right answer. You’re promoted. You’re now the marketing director on Barbie.” Without missing a beat or giving him a moment to gloat, she shooed him away. “You’ve convinced me. Now get out of my office and go convince the rest of the world.”

  And that’s exactly what he did. He revived the Barbie line with the novel idea of segmenting the market. Instead of simply selling one doll per season, Mattel would offer a multitude of Barbies for differing interests, at diverse price points, and targeted at girls of different ages along the spectrum. There would be a Twist N’ Turn Barbie, Ballerina Barbie, Hawaiian Barbie, and even President Barbie. In addition, Mattel would vigorously expand the line for her family and friends with the likes of Big Business Ken and Growing Up Skipper, a version of Barbie’s younger sister whose breasts would get larger and waist would shrink with the rotation of her left arm. Looking to fill every possible segment of the market, Kalinske even started a line of high-priced collectible Barbie dolls, which came with limited-edition fashions by famous designers like Oscar de la Renta and Bob Mackie. As a result of this new approach, annual sales soon skyrocketed from $42 million per year to $550 million by the end of the decade.

  Kalinske’s ability to sell particularly came in handy when he met a woman who made his mind feel both empty and infinite. At the 1979 Toy Fair, there she was: a striking young woman hired to dress as Barbie and present the doll’s latest accessories at the Mattel booth. Karen Panitz was her name, a New York actress who’d recently had a bit part in Saturday Night Fever. She tried to resist his charm, but that didn’t last long, because it was obvious that he understood her and she very much understood him. It wasn’t quite love at first sight, but what they had was much better than that: a romance built to last through the many splendors and tragedies of life, and in 1983 they married.

  Even though he had it all, there was always a need for more. More ideas, more discoveries, and more to do—the instability was always his favorite part. So when Mattel needed a new toy that could replicate for boys what Barbie did for girls, Kalinske rose to the challenge. He commissioned the development of a heroic male action figure, testing out spacemen, military heroes, firefighters, and superheroes—everything under the testosterone-infused sun. The concept that tested strongest was a muscular, sword-wielding, brown-haired conqueror. Kalinske asked the designer to make the hero’s hair blond, and then he and his team worked on digging deeper into their character and coming up with his personality, backstory, and supporting cast. The end result was a unique universe for its master, their new character, He-man. The action figure became one of the year’s best-selling toys and quickly rose to the top of the character popularity charts. This led to the creation of a comic series, collectible trading cards, and the hugely popular animated TV show He-Man and the Masters of the Universe.

  Between Barbie, He-Man, and everything in between, people would say that Kalinske had the “magic touch.” He liked when people said it, even though he knew it wasn’t true. There was no such thing as a magic touch, and it wouldn’t have mattered if there were, because the only thing it takes to sell toys, vitamins, or magazines is the power of story. That was the secret. That was the whole trick: to recognize that the world is nothing but chaos, and the only thing holding it (and us) together are stories. And Kalinske realized this in a way that only people who have been there and done that possibly can: that when you tell memorable, universal, intricate, and heartbreaking stories, anything is possible.

  “More?” interrupted the geisha girl from earlier, appearing beside Kalinske with a warm jug of sake. “Yes, maybe?” she asked hopefully, pointing to his glass.

  Kalinske nodded, returning to the moment. But before the girl could fix him a drink, she suddenly became transfixed by the Game Gear and
, as with the well-dressed man, the world suddenly shrunk around her. Well, would you look at that, Kalinske mused, while having a revelation that would shape Sega, the videogame industry, and the face of entertainment as a whole. Videogames weren’t just for kids; they were for anyone who wanted to feel like a kid. Anyone who missed the freedom and innocence that comes with endless wonder. Videogames were for everyone; they just didn’t realize it yet.

  “What is this?” the geisha girl asked, finally refilling Kalinske’s glass.

  As he considered the question, Nakayama noticed that a grin had grown across Kalinske’s face, and he seemed to know that it had nothing to do with the sake. This was the kind of expression that you remember someone by for the rest of his life. The kind of expression that either starts or ends a story.

  “Can’t you see?” Kalinske said to the girl as if it were obvious. “It’s the future.”

  4.

  RUDE AWAKENING

  As Kalinske settled into his new office in the one-story warehouse where Sega rented space, he couldn’t help but think about how different this was from every other place he’d ever worked. It was a far cry from Mattel’s eight-story tower in Hawthorne, California, not even in the same league as J. Walter Thompson’s high-rise on Manhattan’s Madison Avenue, and barely a step up from the college apartment where he’d founded Wisconsin Man magazine. Well, he thought, at least this new office came with a view, and then he looked out the window at the small company parking lot. It was his first day as president and CEO of Sega of America and he had only met a few people thus far, but he couldn’t resist trying to guess which car belonged to which person.

  “You’re a colossally outstanding idiot!” someone said, interrupting his thoughts.

  Kalinske turned around, looked up, and muttered a barely audible noise that could best be described as the sound a question mark might make. It was Michael Katz, standing by the door, slowly shaking his head, with an unfinished smile on his face.

  “I’m sorry, Michael,” Kalinske said. “I didn’t actively pursue this job.”

  “You stealing my job isn’t what makes you an idiot. That makes you kind of an asshole. But I’ve always known you were secretly kind of an asshole. What I didn’t know was that you were also secretly a colossally outstanding idiot.”

  Kalinske offered Katz a seat, but he declined. “How so?”

  “For taking this job,” Katz said.

  “What makes you say that?”

  “Oh, I don’t know, about a million things, but at the top of the list is the glaring fact that you don’t know a thing about videogames!”

  Kalinske considered this. “I’ll learn,” he said at last.

  “Yes, and what you’ll soon learn is that you shouldn’t have taken this job. Do you know what Sega really is? Sega is a joke. Sega is a punch line,” Katz ranted. He was good at ranting; at times it appeared to be his best quality. “Sega is a ticking time bomb, and you just signed up to strap it to your chest—”

  Kalinske cut him off. “I’m glad you came in here, actually. I’ve been doing some research, and I wanted to say that you did a very strong job, given the hand you were dealt.”

  “I know,” Katz said, nodding. “I did. And look how far away we—sorry, you are from even being a blip on Nintendo’s radar.”

  “Then I guess I’ll be the one to go down with the ship,” Kalinske said with a dignity he felt distinguished him from most other leaders. “Look, I appreciate the advice, Michael. I know it’s going to be an uphill battle.”

  Katz shook his head. “This just isn’t like you,” he said. “What happened? Did he take you to the secret lab? Or was it the hostess bar?”

  Kalinske tried not to let his eyes reveal the answer.

  “Oh, my God. It was both, wasn’t it?” Katz snickered.

  Kalinske stood up and walked Katz to the door. “Listen, I appreciate the . . . whatever you would call this, but . . .”

  “Wait,” Katz protested. “I just want to ask you a question. Do you really think he’s not going to do the same thing to you that he did to me? Think about it.”

  Kalinske tried his best not to. This was a question that had scraped the top of his mind on numerous occasions since his Japan trip, but he’d been trying his best to avoid it.

  With a sheen of sincerity, Katz met Kalinske’s eyes and offered some parting words. “Just remember: you may think you’re in charge and you may think he’s your friend, but watch your back.” And then, before leaving, Katz locked eyes with Kalinske, and it dawned on both men that their future success and failure would forever be strangely intertwined.

  “I really do think you did a good job, Michael.”

  “Thanks, Tom. Thanks.”

  They shook hands and, for a moment, let mutual respect trump awkwardness.

  Kalinske shut the door and walked back to the window, where he spent a few moments staring at the unspectacular parking lot. This was the view, this was his new life. Get used to it, he thought.

  There was a gentle knock on the door, and in came Shinobu Toyoda, a thin, soft-spoken Japanese man who wore fine Italian suits, fetching neckties, and a pair of thick glasses that always seemed to be trying to escape down his nose. He served as the executive vice president with the primary responsibility of acting as liaison between California’s Sega of America and Tokyo’s Sega of Japan. After Kalinske accepted the job, Toyoda had graciously been meeting with the new CEO to give him the lay of the land. Within moments of their first meeting, Kalinske could tell that behind Toyoda’s reserved demeanor and perpetual smile-for-the-camera grin was an incredibly shrewd and resourceful man. What he couldn’t tell, however, was the true source of this man’s devotion. Kalinske had heard varying opinions on Toyoda’s role at Sega of America, ranging from “the straw that stirs the drink” to “a Japanese spy who was ready at the drop of a hat to tattle on his colleagues to Nakayama.” Thus far, his actions had caused Kalinske to believe the former but, then again, wasn’t that exactly how the latter would behave? Kalinske happily greeted his guest. “Toyoda-san, come in!”

  “Please, just Shinobu.”

  Kalinske nodded, convincing himself that Toyoda’s desire to be addressed informally should count as a point in the not-a-spy column. Though, once again, perhaps that was just a clever ruse.

  Toyoda punctured Kalinske’s pulpy thought bubble by advising him that the executive meeting was about to begin. “It will be a great chance for you to meet everyone and understand what they do.”

  “Perfect,” Kalinske said, and then followed Toyoda through the wide hallways of the warehouse. Though the building was small, it had an open feel, which made the many boxes stacked against the wall feel less like clutter and more like the foundation of something to come. “Did I hear you mention the other day that you had recently been in Dallas? What’s out there?”

  “Ah, yes, my family is there,” Toyoda said. After a moment, he seemed to realize that his answer could benefit from elaboration, and he continued, “When I left Japan to work for Mitsubishi, my wife and I made a life in Dallas. So she stays there with the kids full-time and I return for the weekends so we can be together.”

  “Wait, you fly back every weekend? So you basically commute from Dallas?”

  “Yes, exactly,” Toyoda said softly.

  “That’s—” Kalinske was about to say “crazy” until he realized that he would be doing a similar (though shorter) commute for the foreseeable future. With the school year about to begin for Kalinske’s daughters, he and Karen had decided that until next summer it would be best if she remained in Los Angeles with the girls, and he rent a small place in the Bay Area. On weekends, he would drive down to Los Angeles to spend time with his family and then drive back north early Monday morning. It was not at all an ideal situation (for Kalinske nor his car’s odometer), but it wouldn’t have been fair to his daughters to move so abruptly, especially when there was a decent chance Sega might not even be around a year from now. And hey, at least he
wasn’t going all the way to Dallas each weekend. “That’s really nice, Shinobu.”

  Toyoda led him into a shadowy conference room with a large table and dark wooden walls. The room was filled nearly to capacity with just over a dozen employees. Kalinske took a brief moment to introduce himself and explain that today he was there merely as an observer. This led to a few minutes of glad-handing, ass-kissing, and proclamations of future greatness.

  After the compulsory pleasantries came to an end, the meeting resumed—if you could even call it a meeting. In Kalinske’s experience, meetings were places where employees could share ideas—some good, some bad, some unclear—and then isolate the best ones for implementation. Meetings were places where status updates were given, strategies were discussed, and, most important, employees left feeling slightly better about what they were doing. This was nothing like that. Here, all the voices blurred into a cacophony of discontent.

  “What’s the status with Atomic Robo-Kid?”

  “Who cares? The game is garbage.”

  “Well, whose fault is that?”

  “Some idiot at UPL for coming up with a crap game, some other idiot in Japan for porting it to the Genesis, and then another idiot here for ordering too many copies!”

  “Are you talking about me?”

  “Well, now that you mention it . . .”

  “Hey, screw that. You’re lucky you weren’t fired for that Babbage’s bullshit!”

  Finally there was a respite to the chaos when the verbal daggers were momentarily replaced with collective giggles. “Sgt. Kabukiman,” Sega’s director of licensing, Diane Drosnes, repeated over laughter, “Yup, that’s right, he’s back.” Sgt. Kabukiman N.Y.P.D. was a 1990 comedy about a clumsy New York cop-turned-superhero with powers like heat-seaking chopsticks and fatal sushi. Only a few Sega employees had actually seen the movie, but those who had all agreed it had to be among the worst ever made. Yet despite its seemingly obvious horridness, Sega’s game developers in Tokyo thought it was a wonderful film and the Americans needed to obtain the license to make a game based on it. Every month, Drosnes and her colleagues would send faxes explaining why this was a bad idea. But without fail, the suggestion kept coming back from Japan. This perpetual cultural difference was a source of great levity, but after everyone had a quick laugh the bickering resumed in full force.