The Story of Commodore
Despite this astonishing market achievement, computer users who entered the field when the Macintosh and the Wintel hegemony were carving up the landscape probably are unaware of Commodore's achievements in technology and computing. The most irksome part of this is that so much of it was due to Commodore's later internal mismanagement, and sometimes downright incompetency. While no company ever gets all of its projects out the door, and every enterprise has its fair share of false starts and utter failures, CBM seemed particularly bad at picking the products to ship; and of those that they did, their support was riddled with gaps if it was there at all.
The purpose of Secret Weapons, then, is obvious: to catalogue the amazing machines that Commodore might have made and released. Stunning devices like the 900 could have changed the face of enterprise servers; TOI might have been the machine that kept Commodore from ever entering the home computer arena had it sold; the 264 series may have revolutionised home computers with their graphics and internal business software. It's amazing, and a little sad, to think of the wasted brilliance of these lost devices and to realise that they might have kept this inept yet innovative computer company alive. Intentionally, I only write about 8-bit related systems (the 900 and the original Lorraine being the sole exception), as these, more so than the more conventional Amiga secret weapons and the Commodore PC clone line, contain the most surprising and interesting engineering feats of the unsung and largely unknown CBM developers. But yes, there was much more to Commodore than their 8-bits, and this history of the company might help to shed some light on the lost giant.
Commodore's beginnings were rather inauspicious, and start at Fort Dix around 1952 or so with a young US Army soldier, originally an Polish Auschwitz survivor, who had a talent for typewriter repair. Born Idek Tramielski in Lodz, Poland in 1929, the future Jack Tramiel was only 15 when he was sent to the Nazi death camps, where the rest of his family died (his father at the hands of the infamous Dr. Josef Mengele; the rest, in the gas chamber). Rescued in April 1945, Tramielski wed another young survivor (of Bergen-Belsen), Helen Goldgrub, in July 1947 and emigrated to the U.S. later that year to enter the Army in 1948. While his friends tried to impress nubile young women and strutted around in their uniforms and rifles, Jack (as he was dubbed) was honing his skills on Army Hermes units. Later discharged, Tramiel set up shop in the Bronx, and moonlighted as a cab driver to supplement his income. Tramiel first did repair work only, mostly odd typewriter fix-it jobs for the local Fordham University. But as his business slowly started to become more profitable, Tramiel rapidly started to exhibit the devilish business attitude that would later simultaneously make him the most celebrated and hated man in computers for years. The money was in sales and manufacturing, and Tramiel negotiated with the Czechoslovakian state typewriter factory during the late 1950s to start assembling typewriters in Canada. Moving his family to Toronto in 1958 and laying the foundations for his new enterprise, which he christened Commodore International in 1959, Tramiel found another way to strengthen his bottom line: cut out the middle man and start selling his own typewriters. Purchasing a typewriter concern in Berlin and adding that to his international operations, Tramiel had managed to assemble a small yet formidable conglomeration within the space of less than a decade. But why the name Commodore? According to Tramiel, he wanted a company name that had a military ring, and of course General and Admiral had long since been taken.
Commodore's first market challenge came from Japan, which was then spewing cheap mechanical adding devices into the US and European markets in large numbers. Tramiel again shifted gears and at the request of his customers started his own line and the beginnings of Commodore's successful calculator division. By 1962, Commodore International was ready for its first public offering (at a Canadian bargain-basement price of CAN$2.50 a share). Renamed Commodore Business Machines, Tramiel was made president, with new chairman and banker C. Powell Morgan, former president of the Atlantic Acceptance Corporation. The company did well, but the reasons might not have been all ethical. In 1965, Morgan was condemned by a Canadian Royal commission for, among other things, acts of "rapacious and unprincipled manipulation" and total disregard for "all accepted business principles". Morgan was also in default on a $5 million short-term loan. His death shortly afterwards of leukemia prevented him from prosecution, but Tramiel was also subjected to equal scrutiny. Tramiel was not indicted, but the poor publicity had cost CBM dearly. Commodore lost huge portions of the adding machine market to the Japanese, and profits dwindled in the face of ostracism from the Canadian financial community.
The ray of hope came in the form of investor Irving Gould, who in 1966 offered to buy a substantial piece of Commodore in return for Morgan's vacated position. Tramiel, naturally, accepted the offer, but ideas for a turnaround were scant. As a last-ditch effort, Gould suggested a little subterfuge and sent Tramiel to Japan to check out the competition.
There, Tramiel saw the magic rejuvenating ingredient for his moribund calculator division: the new electronic desktop calculators. Tramiel made a strategic and perspicacious decision: drop the mechanical units from production and put all resources into developing a competing electronic unit of CBM's own. Tramiel's quick switch paid off, and Commodore was first on the market in 1969 with the C108, a portable, pocket calculator based on a Bowmar LED display and a Texas Instruments IC core. Buyers went crazy. While it may seem ludicrous to spend hundreds of dollars on machines that now go for a dollar or so in bargain bins, Commodore could not keep the "newfangled electronic adders" in stock -- until 1972, when Texas Instruments decided to produce a calculator of their own. By dint of using the same chip they sold Commodore at a profit, TI was able to undercut Commodore's price severely; worse, new manufacturing processes caused chip prices to plummet, and Tramiel found himself with warehouses full of calculators with chips at the old prices. By 1975, after years of increasing profit, Commodore reported a loss of $5 million on sales of almost $50 million. Tramiel and Gould rapidly realised that the calculator components were the weak link. If someone could control them, they could control Commodore, just like Texas Instruments did.
Like the Internet companies of today, semiconductor companies were then a risky and often unprofitable business, and the cash-strapped company buying one outright seemed a sure recipe for suicide. Tramiel, however, was adamant, and both Gould and Tramiel could see the payoff if the gamble succeeded. Once again, moneybags Gould came to the rescue and personally guaranteed a $3 million loan to purchase a small chip foundry in November 1976: MOS Technology.
MOS Technology was a small semiconductor company in Pennsylvania when chip engineer Chuck Peddle quit his job at Motorola in 1974 and started working for them on his own projects with MOS chief John Pavinen. MOS, and Peddle, were the brainchilds behind one of the major microprocessors of the 1980s: the venerable 6502. A fast, inexpensive and reliable product of NMOS VLSI manufacturing, the 6502 became the CPU for diverse machines during the 1980's. In addition to powering virtually all of the Commodore 8-bits (usually in a modified version based on the 6510, a 6502 with an on-chip I/O port), the 6502 and its later HMOS and CMOS successors powered many disparate systems including the BBC Acorn, the Apple ][ series (the 16-bit 65816 powers the IIgs and the CMD SuperCPU accelerator cartridge for the 64/128), the Atari 8-bits and even the Nintendo systems up to the N64 (the NES used the 6502 and the SuperNES the 65816). Peddle developed its forerunner, the 6501, in direct competition with Motorola's workhorse 6800, the very chip he had been working on at Motorola, to the point where it was intended to be pin-compatible but significantly less expensive. Motorola did not like the prospect of a cheaper drop-in replacement, even one that wasn't machine code compatible, and successfully sued for hundreds of thousands of dollars in damages. With investor support quickly eroding after the lawsuit, MOS rapidly found itself in financial trouble. Pavinen and his partners accepted Tramiel's offer without delay.
While Commodore also made other acquisitions, including Los Angeles CMOS chip manufacturer Frontier and LCD manufacturer MDSA, MOS Technology's buyout was the one with the furthest reaching ramifications. While Tramiel killed most of the other outstanding projects of his new acquisitions immediately, since after all he was still mostly interested in calculators, he heeded Peddle's advice about the 6502 and kept it in development. Indeed, the chip already was being used in computers: Steve Wozniak's Apple I prototype. After initial discussion with Peddle, Tramiel marched up with an offer to buy Apple outright, but Apple's business side, a young entrepreneur named Steve Jobs, wanted considerably more than Commodore was willing to pay. Commodore declined. (What a thought to realise that Apple might have become a Commodore division if Tramiel had liked the price tag!) The 6502 also had found a use in MOS's kit computer, the KIM-1, a hobbyist unit with all of 1K and a six-digit numeric LED bank and a decent seller compared to the famous Altair, which was a major player in those days. Commodore made their own versions of the KIM-1, but Tramiel did not want to be selling kit computers forever. It was Peddle who first brought up the idea of making a desktop personal computer out of the 6502; after the failed bid for Apple, that was just what Tramiel wanted, and put Peddle on the job with Tramiel's second son Leonard to design a computer of Commodore's own.
The result of Peddle's labours was the prototype PET (the acronym Personal Electronic Transactor was actually added later), which Tramiel tried to introduce to Tandy for sale through the leather company's Radio Shack division. Negotiations with Tandy broke down and Tandy decided to develop their own computer instead, but Tramiel refused to be discouraged even after Commodore's initial announcement was greeted with scepticism by the market. As promised, the original PET 2001 appeared in its final form at the summer 1977 Consumer Electronics Show in Chicago as Commodore's first desktop computer. A massive metal and plastic hunk with a built-in monochrome monitor, a colour-coded "chiclet" keyboard, 4K RAM and built-in BASIC, the PET met enthusiastic reception. (This was much to the relief of Peddle, who had worked on it for three straight days without rest to get the unit functional enough for display.) Commodore got flooded with calls from dealers; Tramiel, remembering his experience with typewriters, decided that Commodore would be better off selling the units themselves.
Originally announced for $495 (with CPU, RAM, ROM, keyboard, monitor and tape storage), the new PET found itself the toast of the town. The PET was a capable, effective unit with a stunning array of features, but the price unfortunately was rapidly found to be overoptimistic and Commodore was running out of money. After raising the price to $595 before taking orders, Commodore also offered a $795 version with an extra 4K of RAM, but made people pay in advance -- and made many irritated customers when the wait time for their new computer stretched out to several months or more. Moreover, to force people to buy new PETs instead of expanding old ones, CBM even started drilling holes in the PCBs to discourage people from adding in extra RAM. And tapes on older PETs wouldn't work on newer ones, which soured developers unwilling to release two versions. Radio Shack, now with its TRS-80 Model I at $599, learned from their knuckleheaded competitors and offered faster shipping, more locations for repair, and a nicer price. The PET dropped below the Apple ][ and TRS-80 series in sales by 1980, despite the release of the 3000 and 4000 series PETs in 1979.
During these chaotic days, Tramiel, anxious to consolidate Commodore's independence from the semiconductor market, insisted that the PET memory components also come from MOS. Peddle, ever the innovator, believed this thinly-veiled attempt at maximizing volume would stunt the technological growth of the PET line. Tramiel prevailed, but at a Pyrrhic cost when a frustrated Peddle quit Commodore for the first time in 1978, and then for good in 1980, eventually forming Sirius Systems Technology and the Sirius 1. (Never one to forget a slight, Tramiel got his revenge by suing Peddle for infringement and successfully took back every piece of Commodore stock he still possessed. Today, in a piece of particularly rueful irony, Peddle works for Tandon Limited -- a computer memory manufacturer.)
In the meantime, Commodore had started developing their next generation, then christened The Other Intellect, to counter the company's hemorrhaging. By this time, however, Tramiel's focus with TOI was far different as he announced the company's new direction in April 1980. Having observed that the home market was where the Apple II and the Atari 400 were doing their best, his new dream was to get into the burgeoning consumer market as well by doing the apparently impossible: getting a colour computer into households at the then unheard-of price of $300. After initially vehement internal engineering squabbles, CBM engineers were finally able to meet his goal. The centerpiece of this new box was MOS's VIC chip, which could handle colour graphics (at 22 characters per line) and generate simple music. CBM threw in a 6502 for a CPU and 5K of RAM, and released this machine as the now very famous Commodore VIC-20 in 1981. Name problems aside (Commodore originally intended to call it the Vixen, which sounds similar to an obscenity in German, but VIC, the second choice, sounds worse! -- finally they settled on VC "Volkscomputer" for the European market), the $299.95 machine was a smash hit and the microcomputer wars had begun. Tramiel, warily eyeing the then-looming Japanese computer invasion, first released the VIC-20 as the VIC-1001 in Japan in 1980; its successful introduction effectively stymied conglomerates Sony, Toshiba and Matsushita/Panasonic, which were mulling their own home computer lines over, and delayed their entry into the American computer market until the advent of the MSX standard several years later.
Encouraged, Tramiel issued the VIC-20 worldwide and searched for bigger targets. Texas Instruments' TI-99/4 series were next: the VIC-20's advertisements featuring spokesman William Shatner were succesful, but then the computer started to suffer a "toy" image problem. Texas Instruments, much to Tramiel's chagrin, immediately took advantage of the situation to denigrate their growing competitor. Burned by TI's advertisements that the 99/4s were great game machines and educational too, Tramiel unleashed the first wave of his legendary brutal advertising barrages and started pointing out the price differences between his unit and TI's. Prices plunged sharply with the VIC-20 dropping to a mere $55 (at the staggering production rate of 9,000/day at peak). TI's home computer division self-destructed (revenge is such a dirty word :-), and millions of VIC-20s were sold all over the world. As for the PETs, Commodore continued to sell those, too, introducing the 8000 series in 1981 (which were sold until 1983).
Despite several conceived upgrades, including the VIC-40, the demand for computing power was far outstripping what even the expanded VIC-20 could provide. Tramiel, shrewdly, had already anticipated this development and behind the scenes, Commodore was already working on the VIC-20's successor. Positioned as the future flagship of Commodore's home computer line, this new box was to have 64K of memory, an enhanced 40-column display with sprites and hi-resolution graphics powered by the VIC-II, and an amazing sound synthesiser called SID created by Bob Yannes. Introduced in 1982, the (you guessed it) Commodore 64 was a steal at $599.95. However, the 64 would not have made the marketing impact that it did were it not for more Tramiel magic. First, Tramiel guaranteed software for his new flagship machine with an innovative and mildly unethical developer pitch: a picture of the VIC-20 (with the badge conveniently out of view), a headline touting the machine's thousands of owners and then a blurb about the 64 itself and the great potential it offered users, and developers took the bait. This trick was, however, small potatoes compared to how Commodore planned to sell the unit. Sidelining manufacture of all other Commodore units except the VIC-20, Tramiel built up a massive inventory of 64s, ready to ship. Next, Tramiel thumbed his nose at the existing "elitist" cadre of computer retailers and went straight to mass-market outlets like K-Mart, Toys R Us and Target where the VIC-20 had sold well before with his new, huge inventory. Following in the dubious footsteps of the PET's poor management, some of the shortcuts Commodore had taken started to show through in a rather startlingly high number of units failing out of the box. Commodore responded with deep discounts on the unit, and as the price plummeted, Commodore took Apple and IBM head-on. In their most famous ad campaign, Commodore ("it's not how little it costs, it's how much you get") pointed out the superb value that the 64 was, even combined with the infamously sluggish and initially expensive 1541 disk drive. Ads blanketed TV and computer magazines.
Under this steady promotional blitz, plus a trade-in option that offered a $100 rebate on any other computer or video game console (a clever New York chain called Crazy Eddy started selling the cheap Timex Sinclair 1000, an Americanised Sinclair ZX-81, for $10 so that users could get the rebate; Commodore donated most of them to charity but kept some, reportedly, for doorstops!), sales skyrocketed and the C64 eclipsed its older sibling within a short time. Commodore eventually phased out the VIC-20 to concentrate entirely on its new line, and, as much as any computer brand could be in those frontier days, became practically a household word. By 1984, with other computer manufacturers trapped under the long shadow of the mighty 64, Tramiel's little typewriter enterprise had become a US$1 billion company. "Business is war," was Tramiel's most (in)famous quote. "I don't believe in compromising. I believe in winning."
That year, however, was the year that the CBM monster would grind to an abrupt halt. In January 1984, Tramiel issued a tersely worded statement that "personal reasons prevent my continuing on a full-time basis with Commodore" (in later interviews, a fight between Tramiel and Gould would prove to be the impetus) and was replaced by Gould-selected Marshall F. Smith, a former executive from the Dutch Antilles company Thyssen-Bornemisza NV. Tramiel's in-your-face nanomanagement had finally caught up with him in a big way, leading to a class action suit in November 1983 charging Commodore with withholding operations information about its business affairs. Tramiel hadn't long to wait for his next paycheck, as the bottom fell out of the home computer and video game market in 1984. Casualties were rampant. Coleco abandoned its videogame division and Mattel Electronics' Intellivision nearly killed parent company Mattel Toys with its oceans of debt. Warner Communications decided it didn't want to risk it either, and unloaded its Atari division to the now jobless Tramiel for a song. Jack was working for the competition now.
Without the tight-fisted managerial style Tramiel had long led the company with, Commodore found itself going too many directions at once with too many models that Tramiel didn't kill before he left. The beautiful but incompatible 264 series appeared in 1984 to a chilly commercial reception and worse sales. The abysmally unpopular 500/600/700 series computers failed to re-establish Commodore in the business market and cost a fortune to produce. Even the 64's sales waned somewhat. Commodore's hope for the future lay in their PC and server line -- even this early, Commodore recognized the market for PC clones. At CeBIT 1984 Commodore introduced their first XT clone, as well as the 900 Unix system in 1985. Sales of the PC were decent, but not enough to prop up the hemorrhaging enterprise. A desperate Marshall Smith slashed the payroll a staggering 45 percent, enough to enable Commodore to partially pay off its debts, but nevertheless CBM reported a dismal US$237 million loss in fiscal year 1985.
In the midst of this, the slighted Tramiel had not been idle. Realizing his mistakes trying to expand the Commodore 8-bit line, mercifully surfacing after his departure, Tramiel was determined not to do the same with the Atari 8-bits (the 400, 600, 800 and 1200 series of computers) and focused on some way of rapidly acquiring a new technology to get to market first. It would also be fairly accurate to say that vengeance was no small part of Tramiel's motivation. Tramiel's target was a small California company named Amiga Incorporated, originally named Hi-Toro, that made a small line of odd, high-techish joysticks. Truly, they did, but this was just a cover story for the real gem in the company's treasure chest: the Lorraine Project, a jaw-dropping collection of custom chips based around the Motorola 68000 that outclassed everything on the market with mind-blowing multimedia sound and graphics designed as a stunning game machine. Hi-Toro's story began in 1982 when Activision co-founder Larry Kaplan bailed out and started shopping around to start a new games company. First on his speed dial was Jay Miner, whom Kaplan had worked with at the pre-Tramiel Atari and was now designing pacemaker electronics. Miner had a distinguished pedigree as a capable systems designer, including the clever ANTIC video chip powering Atari's popular 8-bit line of home computers (and coincidentally strong rivals of the Commodore 64), and his reputation probably sealed a US$7 million investment from three dentists Miner knew personally. Kaplan lured David Morse, then marketing VP at Tonka Toys, to the new company as CEO and set up shop in Santa Clara. However, Kaplan became dissatisfied with the pace at his new company as well, where he had installed himself as VP, and bailed out yet again leaving Morse to himself lure Miner (still designing pacemaker chips) to the new company full-time to replace Kaplan. Hi-Toro's front, called the Atari Peripheral group, publicly continued their support for the Atari 2600 in the form of the PowerStick, the amusing JoyBoard (a joystick in a skiboard) and a smattering of simple games, while in the back office the computer development crew created their wonderbox. Hi-Toro's chief innovation (rechristened Amiga, Spanish for "female friend," by Miner after conflicts with Japanese lawnmower manufacturer Toro) was a critical change in policy revolutionary in those days for the industry -- full disclosure to third parties to allow as much outside development of software as possible, considered shocking in a highly proprietary video game market, and to make the system as easy to develop for as possible.
The video game crash of 1983 ruined many fortunes, including Amiga's peripheral division, as business and demand for video game consoles and accessories plummeted. Realizing the Lorraine was their last hope, Amiga went full-speed ahead on their brainchild and hired on additional staff to concentrate solely on getting it to market. Miner continued his work on the custom hardware while software engineers RJ Mical and Dale Luck worked on the operating system. First shown to a restricted audience at Winter CES 1984, the lucky few saw a collection of crudely wired computer boards, waited patiently as the Kickstart ROM was loaded off floppy disk, and then felt their mouths drop open at the smooth, brilliant graphics demonstration the Lorraine wizards unleashed featuring the famous Amiga "Boing Ball." Despite originally being conceived as a game machine, the more the wacky Amiga designers worked on the system, the more they realised that they had the basis for an extraordinary computer, but they were in serious financial trouble having already exhausted the US$7 million they had initially started with. Ironically, only Warner-controlled Atari, Miner's former employer, was willing to invest and loaned the embattled company US$500,000 to keep it afloat while licensing arrangements were hashed out. Atari wanted the technology behind the Lorraine, but was in no way interested in the computer itself or the company. Having no choice other than bankruptcy, Amiga signed, but the young company's future appeared very much in jeopardy.
During this time Tramiel came calling, bent on constructing his Commodore killer. Apparently unaware of Atari's previous dealings with Amiga, Tramiel too wanted the chipset, but in typical fashion simply wanted to buy Amiga out. Knowing he had Morse over a barrel, Tramiel held out for the insulting offer of just 98 cents a share. Amiga refused, but not without a lot of internal trepidation, as Amiga would have to forfeit their technology to Atari if they could not pay back the loan. Morse started looking around for investors and after failing to attract much interest from any other major computer company, abruptly heard secretly from a firm they hadn't expected: Commodore. After clandestine negotiations, Commodore paid Amiga and Amiga paid off the loan to Atari, allowing Amiga to escape their contract with their chipset intact and Amiga to enter negotiations with Commodore for a buyout of their new technology.
In the midst of all this, Warner subsequently unloaded Atari to Tramiel, Commodore sued Tramiel for infringement, and Tramiel found himself once again in trouble. Hunting through his new assets, Tramiel discovered the Amiga/Atari deal and Amiga's attempt to escape the contract. Suing Commodore (and Jay Miner personally) for breach of contract on 13 August 1984 stating that the original $500,000 advance was for an exclusive license to the Amiga technology, Tramiel sought to ensure the Amiga technology would only appear in Atari computers. Amiga appealed to Commodore for help and two days later Commodore publicly announced their intentions to buy Amiga for US$4 a share. Incredibly, Amiga held out, asking for US$4.25 a share, and an additional US$1 million to pay off debts. Commodore consented, Amiga merged to form Commodore-Amiga, and development commenced full-speed on the Lorraine, now renamed the Amiga itself after its original developers.
Commodore may have won the battle by acquiring Amiga, but Tramiel was still determined to win the war by getting to market first anyway. Using off-the-shelf components, Tramiel introduced his own 68000-based computer, the Atari 520ST, in January 1985. At half the announced price of the still-in-development Amiga, Tramiel prepared to fire both barrels in the style he was accustomed to; his infamous "Ten Commandments" advertisements took swipes at both CBM's Amiga and Apple's new Macintosh line for both price and computing power. Lining up vendors and third-party software support, Jack was able to get his new ST line (mockingly christened the "Jackintosh") onto store shelves by that summer. On 23 July 1985, the now laggard Commodore finally unveiled the new Amiga 1000 in an expensive media blitz orchestrated by then-Commodore North America president Thomas Rattigan at New York's Lincoln Centre. A crowd of some three hundred watched as artist Andy Warhol, using Island Graphics Graphicraft software, created a picture of Blondie lead singer Debbie Harry to a full score electronically synthesised by musicians Roger Powell and Mike Boom, author of Musicraft. However, the machine did not enter the market until August, sporting its 68000 CPU, custom chips and 256K RAM, and unfortunately, the same lack of marketing finesse Commodore had exhibited after Tramiel's ouster. Crippled by numb advertising and inconsistent market placement, the Amiga was truly a technologically superior unit due to its phenomenal graphics and sound capabilities and its genuinely multitasking operating system, but its price point was considered unfavourable compared to competing systems and customers just weren't interested. The nearly simultaneous introduction of the Commodore 128, developed by Bil Herd and Dave Haynie et al as Commodore's token upgrade to the 64 line with CP/M compatibility, two internal processors (Z80A and the 8502, another 6502 variant), 128K RAM and a 99.99999% compatible 64 mode, injected new life into the Commodore 8-bits, and the 64 was still as popular as ever, but there was no denying that Commodore appeared to be stuck in neutral.
In March 1986, the ineffectual Marshall Smith was demoted to director and Irving Gould hired on Thomas Rattigan, the executive behind the Amiga's initial rollout, as CEO. Gould did not mince words with Rattigan: cut costs any way you can. Rattigan obliged. The payroll again was cut significantly, three plants were closed, unprofitable products were discontinued (most notably the VIC-20 and 264 lines), and Rattigan cracked down on the sloppy reporting in Commodore's financial department that undermined Smith's years. Commodore introduced the new, slimline 64C that year in the new Commodore stock cream white colour and sloped keyboard style of its bigger brother 128, which was continuing to sell at a decent if unexceptional clip. Slowly, CBM recovered from its funk and posted a US$22 million profit in March 1987, along with US$46 million in the bank, its most solvent stage since 1983.
Two things of significance occurred in 1987. Commodore, finally grasping the flaws in their management of the Amiga line, introduced the new 500 and 2000 models that year; the 500 offered more capabilities, expansion options and, best of all, a more competitive price. The 2000, an expanded version, was offered as a milksop to the power user market, while the 1000 was quietly retired. Sales ballooned at the expense of the stagnant ST series as Atari had done little more than release the expanded memory 1040ST in the meantime. This significant change in fortunes, however, was nothing compared to the change that occurred in the Commodore front office. By 22 April 1987 the largely effective Rattigan was suddenly ousted by none other than Irving Gould himself, declaring himself CEO. Rattigan was understandably incensed, asserting that the reason was none other than good old fashioned personality conflicts and argued that Gould was irked simply because Rattigan was getting all the credit for Commodore's rebound. Gould, for his part, pointed out that the American domestic comeback was poor compared with the increase in overseas markets, which accounted for some 70 percent of Commodore's market. Indeed, Commodore's US revenues had shrunk by roughly 54 percent over Rattigan's term in office. As with Tramiel, the parting was legally acrimonious.
Now in control of the company he had originally bankrolled, Gould's first action at the helm was at the same time expected and totally not so. While taking the predicted cost-cutting measures of slashing staff (from 4700 to 3100) and closing five plants, Gould schemed to reduce the now declining North American operations into only a sales and marketing extension of the transnational company Gould intended to forge. Largely because of Tramiel's legacy, the American arm of the company had operated in semi-autonomy, mostly cut off from the European operations, but Gould wanted to consolidate it as tightly as possible. To this end, North American corporate staff were first on the chopping block as part of Gould's downsizing; half were ultimately dismissed.
While the continuing Commodore PC line failed to penetrate the US clone market, the 10, 20, 30 and later models were decent sellers in Europe. Ironically, however, CBM's financial anchor continued to be the very same computer they were trying their hardest to kill off: the 64. Sales continued to be strong as retail prices sank below US$100. Commodore's desire to sink the 64 and 128 was low in the eyes of many loyalists, but not ill-conceived: at long last, Gould was finally reading the writing on the wall. By the late 1980s, the IBM compatibles had finally achieved supremacy, and Commodore did not want its future models to be continually associated with the aging 64 or to be forever known as a maker of merely quirky computers like the moribund Apple was becoming. The Amigas, too, were beginning to show their age, and Gould ordered a facelift before Commodore fell so far behind that their technology could not keep up.
The redevelopment was two-pronged: a revolution in the 8-bit line, along with a new Amiga. Only one was ever publicly realized. In late 1987, Commodore started secretly developing the Commodore 65 (then under various names, most commonly the C64-III), the new flagship 8-bit system. However, Commodore's attempt at secrecy hadn't figured on the doggedness of the 8-bit community and rumours became substantiated enough for German magazine 64'er to make it the title story in their April 1988 issue. Commodore Deutschland confirmed that they were working on a 64 with a built in 3.5" drive, but little else emerged until summer 1989 when a careless Gould remarked to bankers that a successor to the 64 was planned. Finally, in 1991, 64'er was permitted to view the new C65 in Frankfurt, Germany, and found an astonishing new computer with 64 compatibility but enhanced stereo sound and Amiga-quality graphics. However, Commodore was still working bugs out of the unit, and while the technology was promising, it was not ready for the public.
For its part, the Amiga, slowly, plodded on. Development continued in the background and little reached the store shelves. Commodore released the Amiga 3000 in April 1990 with an upgraded graphics architecture (the new "ECS" chipset) and hardware, but the Amiga redevelopment hit a major stumble with the dismal CDTV, an Amiga 500 lurking as a consumer CD and multimedia player. Marketed horribly, the product bombed to the point where sales staff were not allowed to advertise the CDTV and 3000 together. Two token upgrades to the home-focused Amiga also appeared, the ECS-enhanced A500+ (which lasted six months) and the A600, basically the 500+ in a smaller box. Neither had an effect. Debts mounted.
In 1992, a frazzled Gould finally shut down the 8-bit line for good. Sales were finally slowing on the 64 (as much poor market placement in such things as the 64GS as it was aging technology), and despite the decent media coverage the "secret" 65 project had been receiving, that project actually had been canned in late 1991. Moreover, Commodore wisely realised that the 64 had probably finally peaked. The Amiga project, however, finally struck pay dirt with the new AGA chipset. The first release, the A3000+ (later the A4000) was received with enthusiasm, and the later A1200 was released that fall. In typical style, however, Gould ordered the A1200 released as-was without fixes for some of the machine's major annoyances, such as the CPU-intensive nature of transfer across the IDE and PCMCIA buses. Nevertheless, sales were encouraging, and Commodore prepared for their next assault on the console arena in the guise of the CD32. With specifications comparable to the A1200, the machine was finally something consumers wanted to buy, and with a steady flow of Amiga software CD ports propping it up the system became the most popular CD-based console between 1993-4.
The 1200 ultimately sold a respectable 100,000 units, the CD32 was slowly beginning to capture the market, and even the Commodore PCs continued to be sold if invisibly so. However, Commodore management seemed determined to scuttle the company's ultimately final rebound. Commodore froze development of the AAA and new HP-RISC-based "Hombre" chipset, and other management cracks showed through to the point where software companies eventually announced that they would no longer support the Amiga. With no technology on the shelf to keep the Amiga afloat, the exploding PC market finally caught up, introducing games and consumer applications now out of reach of the former frontrunner. In 1993, the final insult arrived in the form of the infamous Cadtrak lawsuit, brought against multiple computer companies for copyright infringement on their hardware bitmap manipulation technology. Commodore, fighting their lost judgment and refusing to pay, was prohibited from importing their units into the USA and thus forced the company into Bahamian courts for bankruptcy proceedings while top executives continued to feast upon multimillion-dollar salaries. When spring 1994 finally dawned, one by one Commodore's individual national operations folded and went into liquidation starting with Commodore Australia. 22 April saw massive layoffs at parent Commodore International; by 25 April only 30 remained of the original staff of one thousand and the West Chester, Pennsylvania headquarters closed two days afterwards. On 29 April 1994 Commodore finally released a statement:
Commodore International Limited announced today that its Board of Directors has authorized the transfer of assets to trustees for the benefit of its creditors and has placed its major subsidiary, Commodore Electronics Limited, into voluntary liquidation. This is the initial phase of an orderly liquidation of both companies, which are incorporated in the Bahamas, by the Bahamas Supreme Court. This action does not affect the wholly-owned subsidiaries which include Commodore Business Machines (USA), Commodore Business Machines Ltd. (Canada), Commodore/Amiga (UK), Commodore Germany, etc. Operations will continue normally.
In short, the once mighty computer company had breathed its last.
Gould's massive reorganisation way back in 1987 did pave the way for two small parts of Commodore to survive the firestorm: Commodore UK and Commodore Canada (how ironic). Commodore Canada, the beneficiary of inventory dumps when it appeared the end was near, remained in business for over a year afterwards selling leftover stock to finally expire in 1996. The UK subsidiary went out more spectacularly, as chiefs David Pleasance and Colin Proudfoot announced their intentions to buy out the remaining pieces of Commodore and Amiga and renew the company, but it was by now too late as third-party support for the Amiga had withered. In 1995, the fight began in earnest for the leftovers. CBM UK withdrew early, financially strapped, leaving the battlefield to US PC clone manufacturer Dell and European computer conglomerate Escom. Escom was only after the Commodore trademark, but liquidators were adamant about keeping the pieces together. For its part, Dell wanted a 30-day extension to review the available inventory before it paid its US$15 million offer. This, too, was not acceptable; grudgingly, Escom offered US$14 million and the liquidators, anxious to sell the company as soon as possible, accepted. As for Commodore Semiconductor Group, Peddle's former MOS Technology responsible for the chips behind the scenes, it was bought, happily, by former CSG management for US$4.3 million, plus an additional US$1 million for outstanding EPA liens, plant, chip foundry, designs and all. Unfortunately, the new company, Norristown, Pennsylvania-based GMT Microelectronics, reportedly finally flamed out only a few years later.
As for Escom, it took its new acquisition apart immediately. The Commodore name was spun into Commodore BV and Amiga was farmed into a separate company, called Amiga Technologies, under the lead of former Commodore executive Jonathon Anderson, succeeded by enthusiast Petro Tyschtschenko only months later after a public advocacy spat. Amusingly, the Commodore PCs that had contributed, however imperceptibly, to Commodore's survival in Europe emerged again in the new Commodore BV's line of Pentium clones. Amiga Technologies, on the other hand, suffered from a lack of support from the parent company, which admittedly never wanted them in the first place, and the only visible signs of activity were a new logo, a fresh supply of Kickstart ROMs, and the bizarre Walker prototype.
Amiga eventually became a wound that failed to heal, and Escom itself, once the second largest manufacturer of European PC clones, filed for liquidation in June 1996. This, coupled with plunging PC prices, surely had to be the Amiga's death blow. An abortive attempt to sell Amiga to licensee Viscorp to create a set-top box based on the chipset destroyed any remaining optimism (as well as finally sealing the death of Walker). Finally acquired from out of nowhere by San Diego-based PC manufacturer Gateway (then Gateway 2000) on 27 March 1997, little else, except for the release of the long-delayed Amiga OS 3.5 and much internal tumult (including a failed attempt to bring QNX to the Amiga and user outrage over rumblings of going towards an Intel x86 architecture), occurred until 3 January 2000 when unknown Amino Development Corporation bought the logo, license and operations from Gateway for an undisclosed sum. Transforming itself into Amiga International, under the leadership of president Bill McEwen with the help of Tyschtchenko, now VP, the new Amiga had big plans to license its technology and create a new breed of Amiga. (It should be noted that the new Amiga does not actually own the patents; they only licensed them, and Gateway still owned the patents to the Amiga and the C64 -- an increasingly academic distinction as the time limit on these patents runs out.) As a milksop to the original Amiga owners, a new Amiga OS 3.9 was released in cooperation with German firm Haage und Partner, as well as plans for the future Amiga OS 4.0. The new Amiga wasted little time in unveiling their big ideas: a system specification called Zico, which was to offer a choice of CPUs (x86, PPC, SH4, MIPS and ARM versions were envisioned); a motherboard with updated features including PCI, FireWire, USB and Ethernet; and (for the time) an improved graphics chip from Matrox. Tying it all together would be the new Amiga DE ("Digital Environment") operating system, which could run on any of the supported architectures. Announcements of support came from several companies; chief among them, UK Amiga developer Eyetech announced the Zico-compliant AmigaOne, available for interconnect for the A1200 or A4000 that would add PowerPC capabilities and allow dualbooting AOS 3.9 (and presumably 4.0) and DE, or could be run solo. In addition, previously unknown bPlan GmbH also announced Zico systems, stating they would also make a standalone PPC-based platform. So far, so good.
The Commodore curse, however, continued to doom all that touched it. Escom was finally bought by its Dutch subsidiary, which changed the name to Commodore NL. This company, too, folded in early 1997; it was bought on 2 July that year by Dutch conglomerate Tulip BV, but the 16 million Dutch guilders (at 2001 rates, over US$6.2 million) they paid for the license nearly destroyed Tulip itself. After that kind of cash haemorrhage, Tulip was desperate to turn what was increasingly appearing to be an albatross into a golden goose. Their licensing policy of the trademark during this time verged on promiscuous, slapping it not just on PCs but on a wide range of dubiously related office equipment and tie-ins. Probably the low point came when it was licensed to Belgian startup Web Computers, who used it to create the ignominous Commodore 64 Web.it -- not a true successor to the 64, but instead a mundane 486-equivalent PC with a built-in Commodore emulator and Windows 3.1 in ROM to act as a set-top box. Panned by loyalists as a cheap attempt to gain market share, it was a dismal failure as both a successor and as a set-top. Later briefly licensing the name to another Dutch PC clone manufacturer, on 15 June 2001 Tulip ultimately took back the trademark and announced it would itself try to market Commodore computers once again, but at that time announced no immediate plans.
For the Amiga's part, however, its fortunes had once again eroded also as the new Amiga corporation eventually started to look a lot like the old Amiga corporation -- slow and ponderous. Public announcements on the progress of AmigaOS and the Zico-based systems became less and less frequent and the release dates got set back later and later, until the corporate vision of the McEwen Amiga seemed to be focused more towards vague promises of simply a generic multimedia architecture and less on an OS, let alone an actual computer. This shift in priorities seemed to be confirmed in McEwen's periodic public communiques, notably in December 2001, where McEwen blamed the tardy releases on the then-leaden USA economy, and finally took the wrappings off Amiga DE. Not the dramatic new operating system that had been expected, AmigaDE and the Amiga DE SDK were instead intended as linchpins within a universal content delivery and playback platform, initially released for Windows and Linux and scheduled for rollout on various portable devices -- most notably Japanese partner Sharp -- but critically not for the Amiga itself. As for AmigaOS 4.0, Amiga jettisoned its development to German/Belgian developer Hyperion Entertainment, best known for their Macintosh, Linux and previous Amiga game ports (HEY, HYPERION! FIX MAC SHOGO SO THAT IT CAN WORK IN OS X! PLEASE!!!! -- signed, a disgruntled fan sick of having to reboot his G4 into OS 9 to play), so that it could concentrate on the new corporate priority of rolling out DE. AmigaOne and bPlan boards finally appeared in limited quantities, but were crippled by bugs and lack of a consumer operating system. Amiga's corporate affairs were further complicated by squabbles with bPlan over MorphOS, a clean-room AmigaOS-compatible Quark-based operating system, and again in January 2003 when German concern Thendic Electronic Components (eventually adding their French affiliate Genesi S.a.r.l to the lawsuit) sued Amiga, claiming that Amiga had not delivered on an agreement to develop a version of AmigaDE for their Pegasos Windows CE-based handheld game system. Amiga protested, stating that they had made no such agreement, although reference to an unnamed handheld similar to that which Thendic claimed was their Pegasos device appeared in the original corporate agreement. (Even more confusing is the existence of bPlan's Zico-compliant design, also called Pegasos, and developed also in affiliation with Genesi.)
In the meantime, AmigaOS 4.0 continued to stagnate. Ultimately, Amiga did not find a two-front product line to their liking and corporately determined that they would divest themselves of Amiga OS, entering negotiations on 23 April 2003 with Itec LLC, an original Gateway Amiga investor, to spin off AmigaOS and its marks while keeping the Amiga name and Amiga DE. This agreement covered not only AOS 4.0, but all previous versions and the source code and title, and was ultimately consummated 15 March 2004 when the rights were then acquired from Itec by Delaware telecommunications company KMOS for their own cross-platform multimedia delivery system. KMOS, with Bill McEwen and then-CEO Garry Hare on board, affirmed their continued support of Hyperion and Eyetech and made plans to continue development behind Hyperion for the new operating system. However, although Amiga had now administratively reorganized itself, the Thendic case wasn't finished and on 19 February 2004 Amiga was ordered by Judge Robert S. Lasnik, United States District Court Judge, Western District of Washington [State] (Seattle), to comply with the terms of the agreement, citing their lack of participation in the proceedings or inability to counter Thendic's claims. Amiga again cried foul and much chaos ensued, including an apparent forgery of an E-mail from Amiga CTO Fleecy Moss, several public, and in the opinions of some, indecorous declarations of victory from Thendic director Bill Buck, and multiple back-and-forth motions on the case (see http://www.mindrelease.net/amiga-thendic/ for PDFs of the legal motions and briefs filed). Hyperion, for its part, continued work on 4.0 in apparent indifference to the bubbling legal volcano and on 5 June 2004 released the Developer Pre-release for PowerPC-based Amigas (both Classic Amigas with PPC upgrades and the extant AmigaOne boards) to end users, following it up with multiple bugfixes and a full SDK. In the meantime, KMOS changed its name to Amiga, Inc. on 31 January 2005; finally, on 24 December 2006, Hyperion made the completed AmigaOS 4 available. That same month, however, Amiga Inc. abruptly terminated Hyperion and Eyetech's license and sued Hyperion for copyright infringement on 26 April 2007 in Washington state. According to court documents, Bill McEwen complained that Hyperion had continued to expand the operating system feature set "unilaterally" and "created false expectations," thus delaying the operating system's release until well after the document's stated deadline of 1 March 2002, and was illegally using Amiga's marks and failing to turn over the operating system to Amiga, among other infringements, by their release of the product. McEwen also claimed Hyperion had been made aware of this a full month before AmigaOS 4 was to be released. Hyperion, naturally, claimed otherwise, with the interesting assessment that the present incarnation of Amiga, Inc. ("Amiga Delaware") was not the party that had made the original agreement, and more importantly, thus had no right to the Amiga marks. As of this writing, no judgment has been reached.
Although the AmigaOne continued to lurk in hobbyist quantities, Amiga itself finally announced their own Amiga hardware in April 2007 in cooperation with ACK Software Controls' president Adam Kowalczyk. Two systems were announced; the low end called for a $489 unit based on the Freescale MPC8349E, a system-on-a-chip with a PowerPC 603e core at a speed of between 400MHz and 667MHz depending on configuration, in a Flex-ATX style board with PCI, SATA, USB, serial ports and up to 1GB of RAM. On the high end, ACK and Amiga planned a $1498 ATX form factor unit around the P.A. Semi PA6T-1682M, another system-on-a-chip using two 64-bit PowerPC cores at 2GHz, with PCI and PCI-Express slots, SATA, USB and serial ports with four DDR2 RAM DIMM slots. Throughout all the bouncing up and down, however, the most prominent sections of Amiga's website continue to be devoted to their mobile and desktop Windows gaming products based on Amiga Anywhere, the evolved result of the Amiga DE platform. With the future of AmigaOS 4 mired in legal wrangling and these newest hardware implementations not scheduled to appear until late 2007, there is little for true-blue Amiga boosters to cheer about presently.
The Commodore 64 itself, however, lived on to see itself re-released commercially in two new and surprising forms. Independent developer Jeri Ellsworth, a fan of the Commodore 64 from her childhood and an Amiga-phile, noticed the attempts on reviving the Amiga with the AmigaOne and wondered if something similar could be done for her childhood friend. Initially receiving a frigid reception for the idea, Ellsworth forged ahead anyway and developed the Commodore One using modern programmable hardware and off-the-shelf components. The effect on the Commodore 8-bit community was one of immediate shock, and the Commodore One made wildly successful public appearances in 2002 at Commodore expos and retrocomputing fairs to multiple stunned observers (including yours truly). Chief amongst them was Amiga and Commodore developer Jens Schoenfeld, who with his company Individual Computers, signed Ellsworth up to design a larger-scale project: a computer that could reconfigure itself using FPGA technology to become not just a new Commodore 64, but potentially any computer if sufficiently programmed. In fall 2004, the renamed C-One was released to developers and testers, and development progress continues as this article goes to publishing. In addition to multiple computer cores, it features PS/2, Compact Flash, PCI and IDE ports, and additional upgrade options.
However, Ellsworth's work on the C-One nee Commodore One had a significant and surprising branch. While the Amiga world continued on like a bad soap opera, Tulip was still sitting on a trademark that cost them dearly and finally determined to wring any kind of return from it no matter what. Tulip's first move was to solidify their hold on the Commodore name, with an ominous-sounding press release on 11 July 2003 announcing a partnership with UK developer Ironstone Partners Limited where Ironstone would become the sole Commodore licensee and commission new products based on the Commodore mark, including "official Commodore C64 games" and the "official C64 emulator." Enthusiasts complained vigourously (bias disclosure: as a Commodore shareware author, I was strongly against this position) about the crackdown, despite Tulip's assurances non-commercial sites would not be targetted. The new Commodore made several announcements, including resale of games from the old Epyx, U.S. Gold and Hewson/Graftgold catalogues, a music store a la Apple iTunes, and a line of me-too music players in the iPod mold named after Commodore computers ("fPET") through affiliate Yeahronimo. However, under the surface, Ironstone frontman Darren Melbourne was after a bigger payoff, and saw it in the tremendous success the new Atari/Infogrames was having with their line of licensed Atari 2600 direct-to-TV consoles in a joystick. Tapping Mammoth Toys as licensee, the question was now how to get to market before the joystick craze fizzled. Knowing Ellsworth had successfully cloned the Commodore 64 hardware already, the choice was obvious to Mammoth president Frank Landi, and a project to shrink the Commodore 64 into its own joystick incarnation was born. Ellsworth, however, insisted on making the joystick more than the NES-in-a-chip clones that glutted the stick market -- as far as she was concerned, the critical appeal of the C64-in-a-stick wouldn't be (merely) in its game selection, but also in the ability to let owners hack it into a new portable "mini Commodore." Adding more colours, enhanced video output and 128K of RAM, along with solder pads to connect IEC disk drives and a PS/2 keyboard, Ellsworth turned to personal contacts in the Commodore 8-bit community to tweak the games (also from Ironstone's acquired Epyx/Hewson catalogues) for the new flash ROM architecture and write its component software. Manufactured at top speed by Mammoth contractors in China and sold by exclusive agreement with television shopping channel QVC at the end of November 2004, the $30-odd NTSC Commodore 64 Direct-to-TV joystick had strong American sales -- nearly 70,000 the first day -- with websites dedicated to hacking the "DTV" springing up nearly immediately (as Ellsworth had adroitly predicted); it was promptly followed in 2005 by the Revision 2 DTV ("DTV2") for PAL markets, with a whopping 2MB of flash memory, additional port lines and more simultaneous colours. Unfortunately, cost-cutting measures taken in manufacturing diminished the complete experience for enthusiasts, and the PAL DTV2 was particularly maligned for a manufacturing error which generated poor colour. The DTV eventually survived to a third revision (including one last appearance on American soil as the Radio Shack Hummer DTV Game), but slowing sales led to the demise of the line in 2006; despite this, a significant hacking community remains.
Ultimately, the Commodore curse jittered Tulip enough to shed their once coveted Commodore trademark to Yeahronimo, the USA company responsible for the media and music arm of the original Commodore plan, on 27 December 2004 for a total of 24 million euro to be paid by 2010. Unfortunately for enthusiasts, little to date emerged from the Yeahronimo acquisition except continuing their line of Commodore-themed MP3 players and entertainment channel (including mobile gaming), but their licensing did allow one more resurrection of Commodore's PC past -- the Commodore Gaming high-end gaming PC line. Interestingly, the Commodore Gaming PCs offer an option to use classic-styled custom case artwork, including a "C64" design and even one based on Jupiter Lander; as of this writing, the units currently are not sold outside of Europe, but there are plans to bring them to the United States. Although they have their work cut out for them against other entrenched boutique PC businesses such as Alienware and Voodoo, having spoken with them personally, they are attempting to distinguish themselves from the pack with their design and possibly in the future even custom hardware, and so far this incarnation demonstrates the most hope of reviving the Commodore name in the present PC age.
As a postscript, we take one last look at the mother company to ask simply, where did Commodore go wrong? Ask five different people and you'll get twelve different answers, but it seems most clear that Commodore's biggest flaw was marketing and management. Without the strong control of Tramiel, Commodore simply became a company that was too large to control and effectively rein in. More pointed criticism accuses Gould et al. of being more interested in turning Commodore into a tax shelter rather than a profitable enterprise. Wherever the blame rests, it certainly wasn't just plain unluckiness, but down-to-earth sheer idiocy: Commodore had the technology, they had the lead, and they had, at least, for awhile, the money. But at least those of us lucky enough to have ridden the Commodore train while it was running still have the best computers on the planet.