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That is pretty cool. I suppose the "8-player" does not mean simultanioues 8-players but probably 4-player max what the NES can do and there is some multiplexing going on (using an Arduino) so you can have more people round the table for crowd control. Ah, yes, found the setup diagram:

http://cdn.arstechnica.net/wp-content/uploads/sites/3/2015/1...

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It's described in the video. They're playing single-player games; control rotates between eight players as the game's scrolling advances. Players have to coordinate to hand off control as they cross the borders, without the in-game character hesitating and getting shot or falling into a pit. The multiplexing is done outside of the actual NES, so its native capabilities don't matter.

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