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The video game crash of 1983 (known as the Atari shock in Japan) was a large-scale recession in the video game industry that occurred from 1983 to 1985, primarily in the United States. The crash was attributed to several factors, including market saturation in the number of game consoles and available games, and waning interest in console games in favor of personal computers. Revenues peaked at around $3.2 billion in 1983, then fell to around $100 million by 1985 (a drop of almost 97 percent). The crash abruptly ended what is retrospectively considered the second generation of console video gaming in North America.

Lasting about two years, the crash shook the then-booming industry, and led to the bankruptcy of several companies producing home computers and video game consoles in the region. Analysts of the time expressed doubts about the long-term viability of video game consoles and software.

The North American video game console industry eventually recovered a few years later, mostly due to the widespread success of the Nintendo Entertainment System (NES) in 1985; Nintendo designed the NES as the Western branding for its Famicom console originally released in 1983 in order to avoid the missteps which caused the 1983 crash and avoid the stigma which video games had at that time.

Link: The Faces of Evil, Zelda: The Wand of Gamelon and Zelda's Adventure are action-adventure games produced by Philips for their CD-i format as part of Nintendo's The Legend of Zelda video game series. Not designed for Nintendo platforms, the games owe their existence to negotiations related to Nintendo's decision not to have Philips create a CD add-on to the Super NES. During these negotiations, Philips secured the rights to use Nintendo characters in CD-i third-party developer games. The Faces of Evil and The Wand of Gamelon were developed by Animation Magic and were both released in North America on October 10, 1993, and Zelda's Adventure was developed by Viridis and was released in North America on June 5, 1994. The games were given little funding or development time, and Nintendo provided only cursory input. None of the games are canonical to the Zelda franchise.

CD-i players did not sell well and the games saw relatively small sales figures. Though the games initially received largely positive reviews, they have been universally criticized since the mid-2000s. This is attributed to the reaction of many gamers to the obscure games' full motion video cutscenes when they first became widely available through video-sharing websites such as YouTube. The cutscenes are perceived to be of poor quality. Because the aging early 1990s visual effects of the titles failed to live up to the graphic effects of the 2000s, and because for many fans this was their first experience of the games, the CD-i Zelda titles have developed a critical reputation as particularly poor based largely on animation quality and to an extent awkward controls. In the eyes of "devout" hardcore gamers, according to Edge, the games are now considered "tantamount to blasphemy".

Faces of Evil and Wand of Gamelon are played using the side-scrolling view introduced in Zelda II: The Adventure of Link, while Zelda's Adventure has a top-down view reminiscent of the original The Legend of Zelda. All the CD-i Zelda games begin with animated FMVs to illustrate the capabilities of the CD-ROM format, save Zelda's Adventure, which begins with a live-action video.

The Satellaview is a satellite modem peripheral produced by Nintendo for the Super Famicom in 1995. Containing 1 megabit of ROM space and an additional 512K of RAM, Satellaview allowed players to download games, magazines and other forms of content through satellite broadcasts provided by Japanese company St.GIGA. To use Satellaview, players had to purchase a special broadcast satellite (BS) tuner directly from St.GIGA or rent one for a six-month fee, and to pay monthly maintenance fees to both St.GIGA and Nintendo. It was attached to the bottom of the Super Famicom via the system's expansion port. It featured heavy support from third-party developers, including Squaresoft, Taito, Konami, Capcom and Seta.

Satellaview was the result of a collaboration between Nintendo and St.GIGA, the latter being known in Japan for its "Tide of Sound" nature sound music. By 1994, St.GIGA was struggling financially due to the Japanese Recession affecting the demand for its music; Nintendo initiated a "rescue" plan by purchasing a stake in the company. Satellaview was produced by Nintendo Research & Development 2, the same team that designed the Super Famicom itself, and was made to cater towards a more adult-oriented market. By 1998, Nintendo's relationship with St.GIGA was beginning to collapse due to the company refusing to go forward with a debt-management plan and failing to secure a government broadcasting license. Nintendo withdrew support for Satellaview in March 1999, with St.GIGA continuing to supply content until June 30, 2000, when it was ultimately discontinued.

The rise of technologically-superior consoles such as the Sega Saturn and PlayStation and its high cost made consumers reluctant to purchase Satellaview, especially due to it only being sold via mail order, or through specific electronic store chains. Despite this, St.GIGA reported seeing over 100,000 subscribers by March 1997. Retrospectively, Satellaview has been praised by critics for its technological accomplishments and the overall quality of its games, particularly those from the Legend of Zelda series. In recent years, it has gained a strong cult following due to much of its content being deemed lost, with video game preservation groups being formed to dump and preserve its games and other services online.

The list of commercial failures in video games includes any video game software on any platform, and any video game console hardware, of all time. As a hit-driven business, the great majority of the video game industry's software releases have been commercial failures. In the early 21st century, industry commentators made these general estimates: 10% of published games generated 90% of revenue; that around 3% of PC games and 15% of console games have global sales of more than 100,000 units per year, with even this level insufficient to make high-budget games profitable; and that about 20% of games make any profit.

Some of these failure events have drastically changed the video game market since its origin in the late 1970s. For example, the failures of E.T. and Pac-Man for the Atari 2600 contributed to the video game crash of 1983. Some games, though commercial failures, are well received by certain groups of gamers and are considered cult games.