Establishing Sierra On-Line In Oakhurst, CA

After their initial success they made the decision to rename and rebrand On-Line Systems. In 1982 the company was renamed to Sierra On-Line and the company moved to Oakhurst, California. The name “Sierra” was taken from the Sierra Nevada that was located next to Oakhurst. From 1980 to 1983 Sierra On-Line grew from having one employee, Ken’s brother John to over 130 employees. In early 1984 Sierra On-Line was estimated to be the 12th largest computer software company, with $12.5 million in sales.

With the growing popularity of the company, IBM approached them to create a game for their new home computer the PCjr that was in development. IBM wanted to showcase their new system and asked Sierra On-Line to create a game that would take advantage of the system 16-color palette, three channel sound and 128K of memory. IBM offered to fund the development and marketing of the game in a deal that would pay royalties. The Williams accepted the offer and began work on the project.

Roberta Williams created a story featuring classic fairy-tale elements. Her game concept includes animated color graphics, a pseudo 3D-perspective where the main character is visible on the screen, a more competent text parser that understands advanced commands from the player, and music playing in the background through the PCjr sound hardware. The team developed an inhouse game engine known as the Adventure Game Interpreter (AGI) for the development of the game which would prove to be invaluable as it made the ability to port games to other platforms much easier.

In mid-1984, King’s Quest: Quest for the Crown was released to much acclaim, beginning the King’s Quest series. The development of King’s Quest and their inhouse AGI game engine laid the foundation for the team to develop other adventure games in a much timelier manner. In 1986 they released Space Quest: The Sarien Encounter, in 1987 they release Leisure Suit Larry in the Land of the Lounge Lizards and Police Quest: In Pursuit of the Death Angel, all of which spawned many sequels establishing well known franchise for Sierra. In 1990, Sierra released King’s Quest V, the first Sierra On-Line game ever to have more than 500,000 copies sold and the highest selling game for five years. It won several awards, such as the Best Adventure Game of the Year from both the Software Publishers Association and Computer Gaming World magazine

Relocation to Bellevue, Washington

Around 1993 Sierra outgrew their Oakhurst, California office and required a new building. They ended up moving their headquarters to Bellevue, Washington and their Oakhurst office continued to operate as an internal development studio. Through numerous acquisitions and growth, the company was now made up of five separate and largely autonomous development divisions: Sierra Publishing, Sierra Northwest, Dynamix, Bright Star Technology, and Coktel Vision, with each group working separately on product development but sharing manufacturing, distribution, and sales resources.

In 1995 Sierra released its most ambitious project to date, Phantasmagoria. Phantasmagoria was by far the largest project ever undertaken by Sierra. More than 200 people were involved in making Phantasmagoria, which was based on Williams’ 550-page script, about four times the length of an average Hollywood screenplay. It took more than two years to develop and four months to film. The game was originally budgeted for $800,000, but it ultimately cost $4.5 million to develop and was filmed in a $1.5 million studio that Sierra built specifically for the game. The game quickly became the best-selling game in the United States and was Sierra’s best-selling computer game to date. It grossed $12,000,000 and sold 300,000 units during its first week of release.

Acquisitions Mark The Beginning of The End

In February 1996, early e-commerce pioneer CUC International offered to purchase Sierra for $1.5 billion as they seeked to expand into interactive entertainment. After negotiating terms which Ken Williams believed would be in best interest for Sierra’s future, the deal with CUC closed on July 24, 1996. In November 1997 Ken William departed from CUC International, while Roberta remained with Sierra until the release of King’s Quest: Mask of Eternity in December 1998.

In December 1997, CUC merged with HFS Incorporated. The two companies jointly formed the Cendant Corporation consisting of more than 40,000 employees across over 100 countries. Sierra was divided into 5 sub-brands and corporate divisions in 1998 before a massive accounting fraud at CUC was exposed. With the news, Cendant announced intention to sell the computer entertainment division, and on November 20, 1998, announced the sale of the consumer software division to Paris-based Havas SA. Sierra became a part of Havas Interactive, the interactive entertainment division of the company.

On February 22, 1999, Sierra announced a major reorganization of the company, resulting in the shutdown of several of their development studios and cutbacks on others. Over 250 people lost their jobs but despite the layoffs, Sierra continued to publish games for smaller developer. After 1999, Sierra almost entirely ceased to develop games and instead became a publisher of games by independent developers.  A strategic business alliance between Vivendi, Seagram and Canal+ took place in June 2000 forming Vivendi Universal.  Havas SA was renamed Vivendi Universal Publishing and became the publishing division of the newly formed group.

After yet another reorganization in August 2001 which included the closure of Dynamix as well as the layoffs of 148 employees located at the company headquarters in Bellevue, on February 19, 2002 Sierra On-Line renamed to Sierra Entertainment. The newly renamed Sierra Entertainment continued to develop mostly unsuccessful interactive entertainment products.

In the spring of 2004, cost-cutting measures were taken at Sierra’s parent company Vivendi Universal Games due to financial troubles and because of Sierra’s lack of profitability as a working developer. Sierra’s last owned studios Impressions Games and the Papyrus Design Group were both shut down in the spring of 2004. Sierra by this point was simply a publishing label and brand name for Vivendi titles, being used in tandem with their own name for publishing. As a company, Sierra was disestablished on August 24, 2004.

In late 2005, the Sierra brand was re-launched as a new subsidiary called Sierra Online, no-relation to Sierra’s former name Sierra On-Line, which focused on download games and online-only titles. In the summer of 2007, Sierra Online began launching Xbox Live Arcade titles for the Xbox 360. In 2008, Sierra Entertainment’s parent company Vivendi Games merged with video game publisher Activision to form the Activision Blizzard holding company. Vivendi Games was absorbed into Activision after the merger and the ownership of Sierra properties went to Activision. Later that year several Sierra-published games saw their online services shut down in October, and Sierra as a whole defunct the same year.