A New Computer is Offered by Atari

The New York Times

December 14, 1982

Atari Inc. announced a long-awaited new home computer yesterday, but the move seemed unlikely to divert attention from the setback in video games, its main line of business. Last week projections of weaker game sales sent the stock of Atari's parent company, Warner Communications Inc., on a sharp slide.

Atari said that model 1200XL would include an internal memory that can hold up to 64,000 bits of information and 12 keys that the user can program to perform specified functions. Software that fits the two existing Atari models, the 400 and 800, which have been available for several years, will also be compatible with the 1200XL.

The new computer, expected to sell for $900 to $1,000, will also be capable of producing characters used in foreign languages and diagnosing malfunctions in any of its parts. Atari did not announce the exact price of the machine, which it said would be available in the first quarter of 1983.

Microprocessor Power

Analysts noted yesterday that the microprocessor that drives the new computer is no more powerful than the one contained in the 800 model, which has led sales among computers in the $500 to $1,000 range this year.

''It is a marginally upgraded model 800,'' said Clive G. Smith, a senior analyst for the Yankee Group. Compared with similar equipment available from Texas Instruments and Commodore, also manufacturers of home computers, ''it is not a very aggressive or competitive product at all,'' he added.

Raymond E. Kassar, Atari's chairman and chief executive, said that the company is working on the development of a more powerful machine, but declined to say when it would be announced.

Mr. Kassar refused to comment on reports of diminished game sales, which lowered Warner Communications' stock more than 16 points last Thursday alone. Responding to questions from reporters yesterday morning, however, Emanuel Gerard, an official in the president's office at Warner, said: ''We miscalculated the level of cancellations in the fourth quarter. We had never experienced meaningful, deep cartridge competition before this year.''

The company has also been hurt by disappointing sales of its E.T. game cartridge, which some analysts estimate cost the company $22 million in licensing fees. Mr. Gerard said, however, that the company would show a profit on the game.

At a meeting with securities analysts yesterday afternoon, Mr. Gerard said most of the unexpected cancellations in video game orders came from independent distributors, rather than from the major retail chains.

Game Sales to Top '81

He said game equipment sales and cartridge sales will top last year's levels by at least 50 percent and said that even in the fourth quarter, the video games division will still be ''very substantially profitable.''

Mr. Gerard also said the company expects its market share in the cartridge business to improve next year, when it introduces at least five games based on popular arcade games. Such games have traditionally been the hottest sellers in the home market; Atari has not introduced such a home game for several months.

Mr. Gerard said another reason fourth-quarter earnings are expected to be lower is that arcade game sales will be down 75 percent from a year earlier, partly because of a general slowdown in the arcade business and partly because Atari has not produced any hit games for most of the year. ''We went dry somewhere in the spring,'' he said.

Analysts speculated yesterday that because home computers account for only a small part of Atari's revenues, the announcement would not substantially help Warner's stock bounce back. Warner closed at 36 1/4 yesterday, up 1 1/2.

GRAPHIC: Illustrations: photo of Atari's 1200XL computer