Buried under a layer of cement in a landfill in Alamogordo, New Mexico (USA), there are more than 700,000 Atari game cartridges. Among others, there are copies of E.T., the game based on the Steven Spielberg movie. This heartbreaking scene symbolizes the video game crash of 1983, when the demand for games like E.T. it plummeted and Atari threw out (literally) hundreds of thousands of cartridges to reduce supply and maintain prices.
But why did the demand for Atari games grow exponentially, only to then precipitously collapse? As soon as the original Atari games, such as Centipede y Space Invadershit the store shelves, lots of imitations flooded the market.
When innovations become profitable, many imitators appear seeking to make the original work profitable without assuming the high risks of innovating. This phenomenon is not limited to Atari or video games, but is universal in creative products. There are, for example, more than 20 film sequels to The Avengers y X-Men from Marvel.
As Atari games grew in popularity in the 1980s, new creators and programmers entered the video game business, creating literal copies or rip-offs of the most successful games (such as Space Invaders), as Phobos, Pushkin, Quarxon, Yahtman, Catterpiggle y Diggerbonk.
As imitators copied the original and then copied the copies, the early programmers who created pioneering Atari games like the Pong, Combat y Super Breakoutthey were no longer directly involved. His creativity and innovation were diluted by the large number of video game designers who copied each other.
Giorgio Trovato / Unsplash, CC BY
An international team of researchers studied this process, which we have called “creativity dilution”. In a recent study we analyzed how imitations affect a product. We have asked ourselves: were there measurable warning signs before the collapse of a multi-billion dollar market like Atari’s? The results of this research could benefit investors and consumers to better understand creative product trends and cycles, and to distinguish between innovative creators and those who imitate.
Cycles of growth and collapse
Our team addressed this question using our collective expertise in network theory, anthropology, cultural evolution, and evolutionary biology.
We looked at three classes of creative products that experienced exponential growth followed by sudden collapse: the aforementioned Atari games from 1979 to 1991, cryptocurrencies from 2009 to 2020, and Reddit posts in 2018. All inspired a significant number of imitations and ripoffs that they competed for consumers’ attention and money, flooded the market, and diluted original creativity.
Mimicking is especially easy to do on text- or code-based products, since small changes to words or symbols count as a new version. Reddit posts, for example, are usually short messages written in English, very often copying previous posts with minor alterations. Atari games are a collection of 8-bit machine code sequences that were shared among the company’s programmers and could also be copied or reverse-engineered by other companies. Cryptocurrency white papers are documents written in English that contain technical information about the currency and the business.
Can imitation predict failure?
In all three cases we measure repetitiveness, which in linguistics is called lexical diversity, and originality, measured through the information density of a text. For example, “hello, hello, hello!” It’s more repetitive than “hi, how are you?” This second sentence is also more original, since it includes new words that are not found in the other example.
Comparing the uniqueness and repetition of a work with previous versions can give us an idea of the level of plagiarism. If new texts are copied and edited with little originality from earlier texts, both repetition and uniqueness should diminish.
Salva Duran-Nebreda and Sergi Valverde
In fact, we found that the collapse in the number of products launched was preceded by a measured decline in originality in each of our case studies. Between 1980 and 1983, the number of video games released by Atari grew exponentially. This phase of enormous productivity corresponds with a marked and continuous loss of originality in its computer codes.
That is, with each copy, the underlying machine code of the games became simpler and more repetitive. The imitation and replication of the content of the originals contributed greatly to the fall of the market.
Innovation as a collective process
When mods are done by imitators, rather than by the experts who created the initial product, the original ideas of those experts can disappear under layers and layers of mods. This creative dilution describes content that is copied and copied again with few innovative modifications.
As copies multiply and the number of works grows, the creativity that gave pioneering products freshness is increasingly buried, like Atari cartridges in the landfill.
Andre Mouton / Unsplash, CC BY
For Atari, over time there were too many video games similar to Space Invaders. In the case of cryptocurrencies, many digital currencies similar to Bitcoin have appeared, although it is still the most popular. On Reddit, too many posts on hackneyed topics caused users to lose interest, which reduced the number of subscribers.
When imitations flood the market, the expert creativity that acted as a catalyst is diluted. Consumers lose interest, as in the case of Atari, or investors lose their money when they can no longer tell innovation from bad imitation.
Can we see it coming?
Imitation is not bad. After all, copying successful ideas is key to the development of culture and technology. New products are rarely created in isolation; ideas from the past are the foundations of future innovation.
The boom for certain creative products is likely to end in bust when the number of imitators far outstrips the supply of fresh ideas or creativity. The methodology used in our study can predict that collapse. In the future, this analysis could be applied to complex systems such as technological patents and musical genres.