They are rapidly becoming the largest industry to be in, over Film, TV and music that is. Hence one of the main reasons i started this course. Bigger budgets, larger profit margins, and soon to have a greater audience as well. But where did it all start? For such a widely known field its quite hard to pinpoint the moment it all began. It all comes down to the definition, the history of computer games is different to the history of video games, and depending on where you get the definition from, it can differ even more. For me i feel a computer game is a program you play for fun on a computer or console of some sort, either pre-programmed, on a disk or a cartridge.
It all started in 1952 with "OXO", or more commonly known naughts and crosses, created and programmed by Alexander Sandy Douglas, a university student studying at the university of Cambridge, this game is often overlooked as the first game as it was only shown the the staff and students of the university, but as it is a playable program stored on a "punched tape (aka input tape)" It counts as the first computer game.
The second computer game, often mistaken for the first, was Tennis for two, developed by William Higinbotham in 1958, a physicist who worked on the Manhattan project. It was developed from technology that the army used to calculate trajectory of ballistics missiles, and was shown at a visitors day at the Brookhaven National Laboratory in New York to make the day a little less boring. It was not considered a game and was never patented as the U.S Government would have owned the patent, because there technology was used to create it.
Next came along Space war which was the first game to allow multiple people to play at once (Multiplayer). The idea of the game was to fly your spaceship around the screen while avoiding the gravitational pull of the sun in the centre of the screen, while also trying to shoot your opponent. You can play a replica of the game here. I had a go myself and personally found it abit tricky avoiding the sun.
The game was created by a programmer from MIT by the name of Steve Russell in 1962, and is in my opinion a major milestone for gaming. While the previous games existed in real life, Space war was not something you could go out and do yourself. Personally i don't go out and hop in my spaceship to have a space battle with one of my mates. But if i wanted to i could have a game of tennis or play a game of tic-tack-toe, it was an original idea and was specifically designed to be a game, so therefore i consider this to be the first proper game.

Space War sparked the idea of the next computer game, called Computer Space, the creation of Nolan Bushnell, who came across Space War at the University of Utah. He could hardly pull himself away from this amazing creation, but as the setup of Space War consisted of a Vector Display ($20,000) of a DEC PDP-1 computer ($120,000) which stands today at over $1 million, he didn't get many opportunities, most universities didn't have them and the ones that did only had the one or two. So he put the idea to the back of his mind and moved on.
Bushnell later got a job at Ampex as an engineer working with a man called Samuel Frederick Dabney, Jr, who shared his love of games, they later went into business together and created Computer space, set in space (obviously) you fly your ship around shooting enemy ship to gain points. They had created the fist coin operated computer game, unfortunately it wasn't a commercial success, but it did pave the way for future coin operated machines, and also lead to the founding of the well known computer games company called Atari, founded by Bushnell himself.
The first game that was created at Atari was Pong in 1972, a widely known game in which the objective is to hit a ball cross the court with a basic block like paddle past your opponent to score a point, the first person to reach a score of 10 in the winner, it can be played as either single or multiplayer.
The game was originally developed by Allan Alcorn, but Bushnell had a say in how the game played too, he made a few changes to the game play and sound before it was available to the public, such as changing the trajectory of the ball to make the game a bit harder. The first machine was put in a local bar and was so successful they decided to sell the game themselves rather than using other companies. After a few years of success, they made a home version of Pong in 1975 which sold over 150,000 units.

Refferences
OXO:
http://classicgames.about.com/od/computergames/p/OXOProfile.htm
http://www.gamasutra.com/view/feature/132293/the_history_of_pong_avoid_missing_.php?print=1
Tennis for Two:
http://www.youtube.com/watch?v=s2E9iSQfGdg
http://videogamehistory.wikia.com/wiki/Tennis_for_Two
http://www.virginmedia.com/games/inpictures/top-tennis-video-games.php?ssid=10
Space war:
http://inventors.about.com/gi/o.htm?zi=1/XJ&zTi=1&sdn=inventors&cdn=money&tm=9&f=00&su=p284.13.342.ip_&tt=2&bt=4&bts=4&zu=http%3A//spacewar.oversigma.com/
http://inventors.about.com/od/sstartinventions/a/Spacewar.htm
http://tartley.com/?p=15
http://dormsgamehistory.files.wordpress.com/2010/12/spacewar.png
Computer Space:
http://www.youtube.com/watch?v=b3BQsCCwo8w
http://technologizer.com/2011/12/11/computer-space-and-the-dawn-of-the-arcade-video-game/
http://www.giantbomb.com/computer-space/3030-20713/
http://futureblue.files.wordpress.com/2013/02/cspace14.jpg
Pong:
http://www.ponggame.org/
http://thedoteaters.com/tde/wp-content/uploads/2013/03/pong-cabinet.png
http://myweb.fsu.edu/lromaneski/pong.jpg
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