SM: What rights did you actually secure for Nintendo for Tetris?
HR: The contract I helped them negotiate was for worldwide rights for the console, and they then licensed the Japanese rights to me to continue publishing the game.
SM: What happened after that?
HR: I stayed in Japan for another six years and got caught between platforms. Each hardware platform would last for six or seven years, like for the PlayStation 1. Each time, there was a switchover sales would drop drastically because the install base would be very small compared to the previous platform. Big public companies are better at surviving those lean times than private companies.
I wanted to go to California and get into this new business, the Internet business, that did not exist in Japan. It did not exist there because NTT controlled the data transfer and it was very expensive to be able to connect in Japan.
In 1995, all the rights to Tetris and all the contracts associated ended because the rights defaulted back to Alexey Pajitnov. He had asked me to help him keep his rights because the Ministry of Software would say that he had no rights because of communism. In 1995, that is exactly what happened. I went to bat for him and we established a company here. We fought with the ministry, which had brought in all these expensive lawyers. I remember sitting in a room with Nintendo lawyers and the ministry’s lawyers and thinking that I was the only one in the room who was not a lawyer.
I told them that at some point in this country there would be a jury of ordinary citizens who would determine who had rights to this game. Is it the guy who made the game or is it a bunch of bureaucrats from Moscow who are usurping those rights. I told them I was betting on the guy who wrote the game and that we would just have to go to court.
They then negotiated. I ended up forming a partnership, and the only reason I even needed that was because they had trademarks and copyrights in all of the territories that I could sell the game in. That would have taken me years to fight to get the trademark and copyright back in each of those countries. Rather than do that we formed a partnership which lasted from 1996 to 2002, which is when I bought them out.
SM: Was the partnership with the Russian ministry and the company you and Alexey created?
HR: It was the ministry, but when the Soviet Union collapsed it became a private company. The parternship was called The Tetris Company and all licenses for Tetris came from the The Tetris Company. In 2002 I raised money and formed a new company called Tetris Holding, and I bought out the ministry. Alexey put his rights into Tetris Holding, which now has all rights and holdings regarding everything Tetris.
SM: Who runs Tetris Holdings?
HR: Basically I run all the Tetris businesses.
SM: When you got this finalized, what was happening on the Internet side and business side?
HR: I had started a company in 2001 to make games for mobile phones in the United States. That was basically when Tetris was booming on mobile phones. I sold that company three years later.
SM: How big did the mobile business become?
HR: The business was meant to publish any type of game, although 95% of our publishing was Tetris. We were at the time doing annual sales of $20 million. We sold the company for a reported $137 million to Jamdat. A year later Jamday was bought by Electronic Arts, which now has a 15-year license to Tetris.