Nintendo had strict licensing policies for the NES as a way to encourage quality over quantity, in hopes of avoiding the fate of Atari during the video game crash of 1983. Third parties were limited to releasing 5 titles per year for the NES, all titles had to be reviewed by Nintendo before they would be licensed, and the console had a system to lock out unauthorized games that did not contain the necessary patented chip as a way to enforce Nintendo's control.

A combination of third-party developer pushback, legal challenges, and competition from other console manufacturers such as Sega eventually forced them to relax their policies.