Shooting Arcade is one of only two Atari 2600 games to use the Light Gun (Sentinel being the other), but was never released. Interestingly, it appears that Shooting Arcade was not developed in the US, but rather in Mexico by a company called Heuristica. How Axlon was involved is unknown, but they may have simply sub-contracted the game out to Heuristica instead of doing it themselves. So why wasn't Shooting Arcade released? No one knows the true reason, but one possibility is the flawed targeting system of the Light Gun. Another possibility is the late date of the game (1989). It's doubtful that an Atari 2600 target shooting game would have sold in great numbers, and this is probably why Atari went with the more action oriented light gun game Sentinel instead.
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