And then there was...COLOR - the Lynx!

Back in 1987 the quite well known software-company called "Epyx" (Summer Games, Winter Games, etc.) wanted to make it to the hardware-sector. With experienced developers (e.g.: R.J. Mical and Dave Needle, who also were involved in the development of the Amiga) they created a handheld machine with color graphics and powerful hardware-capabilities. They called their system "Handy". But they didn't have enough funds to finish the project.
Atari got to know about this and decided to buy all rights to the Lynx and to the whole library of software titles from Epyx.
But delivery-problems prevented the Lynx from becoming a big success, though out-performing other systems like the Gameboy. But having pushed the Gameboy heavily, Nintendo began to rule the market.
The Lynx was quite big and so Atari decided to design an improved version that was lighter and had a lower power consumption: the Lynx II. It also featured a stereo-headphone-jack (the Lynx I only offered mono-sound).