In 1972 arcade Pong was introduced to the world.  Bushnell, the cofounder of Atari, hired Al Alcorn to program games for his company.  At the time, Alcorn was not so deft at programming games—therefore Bushnell had him create a simple tennis (ping-pong, specifically) game as sort of a warm-up exercise.  The resulting game was named ‘pong’, mainly for the ‘pong’ sound that one hears when the virtual ball hits the paddle or side of the screen, and also because the name ‘ping-pong’ had already been copyrighted.
The prototype was placed in Andy Capp’s Cavern (a bar in Sunnyvale, California) to see how the customers responded to the new gadget.  At first, only several took interest, but the fun spread out among the people and the game became quite popular.  Pong was then sold to a variety of stores and places (including Sears) and its popularity caused many companies to release slightly different/modified versions of the same game.  However, Pong as Atari had made it remained special in that it had a on-screen scoring system.  The Pong rave lasted until the late 1970s in the US, though it went until the early 1980s in Europe.  This is the revolutionary game that shaped the console market.
So how exactly does Pong work?  It truly does follow the general concept of tennis and ping-pong: the back and forth, receive-and-hit motion performed by the two opposing players.  Therefore in the game Pong, one has control over a single “paddle” (noted by a short bar to the furthermost right or left of the screen) by using a wheel or knob (the paddle also responds to the variable speed by which the wheel/knob is turned).  The purpose, of course, is to hit the “ball” that moves across the screen, bouncing off of the sides and the paddle—and the ball would travel in different angles and therefore fly in different ways depending on how it hit the paddle.  The opponent scores a point when the ball misses the paddle.

*Pictures from http://en.wikipedia.org/upload/e/ef/Pong.PNG and http://www.designboom.com/eng/education/imm_pong/12_1.gif, respectively

Sources:
Designboom. ‘Pong’, 1972. <http://www.designboom.com/eng/education/imm_pong/12_1.gif>

Designboom. The History of Video Games: From ‘Pong’ to ‘Pac-man’. 12 Oct 2003.<http://www.designboom.com/eng/education/pong.html>

Wikipedia. Pong. 12 Oct 2003. <http://en.wikipedia.org/upload/e/ef/Pong.PNG>

Wikipedia. Pong. 12 Oct 2003. <http://en.wikipedia.org/wiki/Pong>

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