It was as early as 1966 when Ralph Baer came up with the idea for the first programmable video game console. At the time he was working for Sanders Associates and with help from Bill Harrison and Bill Rusch, he made the system.
By 1967 they had made a hockey game where the speed of the puck depended on how hard it was hit. Baer began applying for patents for the new console and, once granted, Sanders Associates had exclusive rights to make and sell these video games, and any others who wanted to make games for the console had to be licensed by them. Baer then needed someone to manufacture and distribute the console and was demonstrating the product to RCA, Zenith, General Electric and Magnavox. It was Magnavox that agreed to make the product and so the Odyssey's production began on January 27th 1972 to be released in May.
The console came with 12 circuit cards that allowed the player to change gameplay. They did not contain actual programs, but instead they physically altered the signal path inside the machine, making the output (a few moving elements on the screen) appear different, thus creating a different style of gameplay which could be called a new game. There was no microprocessor included in the console and so all the cartridges do is reconfigure the electronics inside.
Odyssey also came with a set of dice, playing cards and poker chips to add more player involvement and depth to the games. Score cards were also included as the console didn't keep scores for you. Players could make up their own rules to the games as well. Two screen overlays were also included. These were laid on top of the TV screen to provide the right background for the game you were playing.
The Odyssey ran on batteries, but an AC adaptor could also be bought. The Odyssey "Shooting Gallery" was another item that could be purchased which included 4 games and a light-sensitive gun.
The console was poorly marketed and some dealers scared away customers when they claimed that the Odyssey could only be used with a Magnavox TV (but this also boosted the sale of Magnavox Rifle TVs to 20 000 in 1972). The Magnavox sold 85 000 consoles in 1972 but was withdrawn about a year after release as competitors began making consoles and taking away the Odyssey's sales.